Amylyx Pharmaceuticals, Inc. (NASDAQ:AMLX) is a clinical-stage biopharmaceutical company focused on developing innovative treatments for neurodegenerative diseases. The company's lead asset, AMX0035, is a fixed-dose combination therapy designed to target endoplasmic reticulum (ER) stress and mitochondrial dysfunction, two key pathways implicated in the pathogenesis of various neurodegenerative disorders.

Amylyx has made significant strides in advancing its pipeline, despite facing a setback with the recent failure of its Phase 3 PHOENIX trial for AMX0035 in amyotrophic lateral sclerosis (ALS). The company has pivoted its focus to other indications where the mechanism of action of AMX0035 may prove beneficial, including Wolfram syndrome and progressive supranuclear palsy (PSP). Additionally, Amylyx is developing AMX0114, a potent antisense oligonucleotide targeting Calpain-2, for the treatment of ALS.

Business Overview

Amylyx was founded in 2013 with the mission of ending the suffering caused by neurodegenerative diseases. The company's approach is centered on targeting the underlying cellular mechanisms that drive neurodegeneration, such as ER stress and mitochondrial dysfunction. This strategy has led to the development of AMX0035, the company's lead product candidate.

AMX0035 is a fixed-dose combination of two active ingredients, sodium phenylbutyrate (PB) and taurursodiol (TURSO), which work synergistically to mitigate ER stress and mitochondrial dysfunction. Preclinical studies have demonstrated the ability of AMX0035 to prevent neuronal cell death under various stress conditions, including in models of ALS, Alzheimer's disease, and Wolfram syndrome.

In September 2022, AMX0035 (marketed as RELYVRIO in the U.S. and ALBRIOZA in Canada) received regulatory approval for the treatment of ALS. However, in April 2024, Amylyx announced that it had started a process to voluntarily discontinue the marketing authorizations for RELYVRIO/ALBRIOZA in the U.S. and Canada, following the failure of the PHOENIX trial to meet its primary and secondary endpoints.

Despite this setback, Amylyx remains committed to advancing AMX0035 in other indications where the mechanism of action may be beneficial. The company is currently conducting a Phase 2 trial of AMX0035 in Wolfram syndrome, a rare genetic disorder characterized by ER stress and mitochondrial dysfunction, and a Phase 3 trial in PSP, a rare neurodegenerative disorder with a strong link to tau pathology.

In addition to its work on AMX0035, Amylyx is also developing AMX0114, an antisense oligonucleotide targeting Calpain-2, for the treatment of ALS. Calpain-2 is a well-established target in the process of axonal degeneration, which is a key contributor to the pathogenesis of ALS and other neurodegenerative diseases.

Financials

Amylyx reported strong financial results for the full year 2023, with annual revenue of $380.8 million and net income of $49.3 million. The company's annual operating cash flow was $11.9 million, and its annual free cash flow was $10.7 million.

For the first quarter of 2024, Amylyx reported net product revenue of $88.6 million, down from $108.4 million in the fourth quarter of 2023. This decline was primarily due to the announcement of the PHOENIX trial failure, which led to a decrease in new prescriptions and refills of RELYVRIO/ALBRIOZA. The company expects to report no meaningful revenue after March 8, 2024, as it has started the process to voluntarily discontinue the marketing authorizations for RELYVRIO/ALBRIOZA.

Cost of sales for the first quarter of 2024 were $116.4 million, which included non-cash charges of approximately $110.5 million associated with the write-down of inventory and the loss on contract manufacturing organization (CMO) purchase commitments related to the decision to discontinue RELYVRIO/ALBRIOZA.

Research and development expenses for the first quarter of 2024 were $36.6 million, while selling, general, and administrative expenses were $57.8 million. Following the restructuring announced in April 2024, which included a 70% workforce reduction, Amylyx expects its total operating spend to decrease to a range of $30 million to $40 million per quarter, in line with its pre-commercial spending levels.

Liquidity

As of March 31, 2024, Amylyx had $373.3 million in cash and investments, which the company believes will be sufficient to fund its operations into 2026, allowing it to advance its key clinical programs in Wolfram syndrome, PSP, and ALS.

Pipeline Updates

Wolfram Syndrome

Amylyx's Phase 2 HELIOS trial of AMX0035 in Wolfram syndrome is progressing well. In April 2024, the company announced promising interim data from the first eight participants who had completed their 24-week assessments. The data showed improvements in beta cell function, as measured by c-peptide response, as well as stabilization or improvement in other disease manifestations, such as visual acuity.

These interim results are consistent with Amylyx's preclinical data, which demonstrated the ability of AMX0035 to dampen the impact of ER stress and mitochondrial dysfunction in Wolfram syndrome models. The company plans to meet with the FDA to discuss the next steps for the Wolfram syndrome program, and it expects to report topline data for all 12 participants in the HELIOS trial in the fall of 2024.

Progressive Supranuclear Palsy (PSP)

Amylyx is also advancing AMX0035 in PSP, a rare neurodegenerative disorder characterized by tau pathology. The company's rationale for pursuing this indication is based on the tau-lowering effects observed with AMX0035 in a previous Alzheimer's disease study, as well as the involvement of ER stress and mitochondrial dysfunction in the pathogenesis of PSP.

The ORION trial, a global Phase 3 study of AMX0035 in PSP, is ongoing, and Amylyx expects to have data from an interim analysis in mid-2025.

Amyotrophic Lateral Sclerosis (ALS)

While Amylyx has discontinued the commercialization of RELYVRIO/ALBRIOZA for ALS, the company remains committed to the ALS community. Amylyx is advancing AMX0114, an antisense oligonucleotide targeting Calpain-2, for the treatment of ALS.

Calpain-2 is a well-recognized target in the process of axonal degeneration, which is a key contributor to the pathogenesis of ALS. Amylyx plans to file an investigational new drug (IND) application and initiate a multiple ascending dose clinical trial of AMX0114 in people living with ALS in the second half of 2024.

Risks and Challenges

Amylyx faces several risks and challenges in its pursuit of developing treatments for neurodegenerative diseases. The company's lead asset, AMX0035, failed to meet its primary and secondary endpoints in the PHOENIX trial for ALS, which was a significant setback. While Amylyx is pivoting to other indications, there is no guarantee that AMX0035 will be successful in Wolfram syndrome, PSP, or any other future indications.

The development of novel therapies for neurodegenerative diseases is inherently challenging, with a high rate of failure in clinical trials. Amylyx may encounter difficulties in patient enrollment, regulatory hurdles, and competition from other companies developing similar or competing therapies.

Additionally, the company's financial performance is heavily dependent on the success of its product candidates. The discontinuation of RELYVRIO/ALBRIOZA will result in a significant loss of revenue, and Amylyx will need to carefully manage its resources to ensure it can advance its pipeline while maintaining a strong financial position.

Outlook

Despite the setback with the PHOENIX trial, Amylyx remains focused on advancing its promising pipeline of product candidates targeting neurodegenerative diseases. The company's interim data in Wolfram syndrome and its rationale for pursuing AMX0035 in PSP and AMX0114 in ALS suggest that Amylyx's approach of targeting ER stress and mitochondrial dysfunction may be a valuable strategy in addressing these devastating conditions.

With a cash runway into 2026, Amylyx is well-positioned to deliver on key milestones for its clinical programs, including the expected topline data from the HELIOS trial in Wolfram syndrome in the fall of 2024 and the interim analysis of the ORION trial in PSP in mid-2025. The advancement of AMX0114 in ALS also represents an exciting opportunity for the company to potentially address another area of high unmet medical need.

As Amylyx navigates the challenges of drug development in the neurodegenerative disease space, investors will be closely watching the company's ability to execute on its strategic priorities and deliver meaningful progress across its pipeline. The company's commitment to the science and its mission to end the suffering caused by these debilitating conditions will be critical factors in determining its long-term success.