The Woodford Patient Capital Trust delivered a strong return in July, a month during which the market very quickly regained its poise following the post-referendum sell-off in June.
By far, the most significant individual contribution to performance came from US biotech, Prothena. Early in the month, the company announced very encouraging trial data from its Phase I/II study in NEOD001, its potential treatment for AL amyloidosis. This provided further convincing evidence of the drug’s effectiveness with excellent patient response rates and a clean safety profile. The market’s response was initially muted but it has started to warm to the importance of this news, with Prothena’s share price rising by over 50% by month end. In our view, this new data significantly derisks the registration trial for the drug, which is due to read out towards the end of 2017 or early 2018. We met management during the month for a full update on the company’s pipeline development progress. We remain convinced that the current share price is profoundly undervaluing Prothena’s long-term potential, not just in NEOD001, but also in the Parkinson’s disease therapy that it is developing in partnership with Roche and in other earlier-stage but very promising drug development candidates.
Elsewhere, Vernalis issued a very reassuring trading update during the month which confirmed that it is fundamentally on track. The company also reported the successful completion of the CCP-08, bioavailability study, its third extended-release product targeting the US prescription cough-cold market. We remain very confident that the company offers significant upside potential as it successfully executes the US cough-cold opportunity.
ReNeuron, meanwhile, also delivered some very promising pre-clinical data in its retinal stem cell technology, which highlighted the therapy’s safety, tolerability and efficacy profile. Data from its Phase II trial in stroke patients is due to read out towards the end of this year and we remain very excited about this young company’s long-term prospects.