CURIDIUM MEDICA (CUR)

Previous Stock Tip

These companies are all previous recommendations from the Red Hot Portfolio that I have subsequently recommended and then sold from the portfolio at a later date. By no means are these companies intended to be buy recommendations for you to go out and invest money towards their shares. For the opportunity to start making serious money from the recommendations I am making now, just start your no obligation trial!

CURIDIUM MEDICA (CUR): Dec 2007

RHPS Recommendation – SELL

Curidium operates in the field of drug development, a particularly difficult one for investors. In the absence of any positive developments since I tipped the shares in June, I am going to remove them from the portfolio, to make room for fresh ideas. SELL

CURIDIUM MEDICA (CUR): Interest ‘Reaching New Heights’ - Oct 2007

RHPS Recommendation – HOLD

Interest in Curidium’s products and in personalised medicine ‘is reaching new heights.’ Now the brains behind the business, Dr Anne Bruinvels is to concentrate on product development as chief scientific officer, while chairman Gosse Bruinsma assumes the duties of chief executive. Hopefully, this will lead to some commercial deals. Until we see some signs of action, HOLD. 

CURIDIUM MEDICA (CUR): Raises £2.5m - Aug 2007

RHPS Recommendation – BUY

Curidium Medica has raised £2.5m through a share placing and has filed worldwide trademark applications for “PsychINDxTM”, the name given to its diagnostic test that classifies patients with schizophrenia/bipolar disorder into four subgroups. The global market for antipsychotics, which are used to treat these disorders, was valued at $12.5 bn in 2004 and is expected to grow to $20.5 bn by 2009. Finally, Curidium is joining the US-based Personalized Medicine Coalition, a group dedicated to promoting personalized medicine. A high risk BUY.

CURIDIUM MEDICA (CUR): Cash in with this hot little stock - Jun 2007

RHPS Recommendation – BUY

Anne Bruinvels leant across the table and gave me a look that would melt the most cynical investor. “This,” she said, “is the future of medicine.” Well, it takes more than the word of an attractive, 39 year old to sway a scarred business hack like myself – even if she does have a PhD in Neuroscience, and is a past winner of the London Biotechnology Network’s “Young Entrepreneur of the Year Award”. But it certainly got me interested.

Saving billions of dollars...

Dr Bruinvels has spent the last five years perfecting a proprietary technology called Homomatrix, and she has now brought this to the stock market in a company called Curidium Medica. I will explain a bit more about this later, but essentially it is a tool that can assist in the creation of “personalised medicine”. Personalised medicine is what Dr Bruinvels means by the future of medicine, and what this means to you and I are drugs that are tailored specifically for our needs, based not only on our medical symptoms but also on an analysis of our genetic and molecular make-up.

Such drugs are far more likely to make us feel better than the standard treatments delivered today, which all too often have no effect or, in fact, make us feel worse. What is more, personalised medicines can cut billions of pounds off the cost of healthcare to the benefit of both the tax payer and the pharmaceutical industry.

Multiplying uncontrollably...

Traditionally doctors have had to rely upon the observable manifestations of a disease or treatment. This could be a tumour on a mammogram, or a patient’s dizziness in response to a drug. It is only recently that doctors have been able to incorporate a patient’s molecular information, such as protein biomarkers in the blood. Take cancer, for example. The only way that oncologists have been able to classify cancer is according to where it appears – thus we have breast cancer, prostate cancer, lung cancer, etc. Now, though, it is possible to classify a patient’s cancer by the genes that it expresses, its cell surface proteins, and other molecular attributes.

Women with breast cancer are amongst the first beneficiaries of this advance. About 30% of breast cancers are characterised by the over-expression of a cell surface protein called human epidermal growth factor receptor 2 (HER2). In normal quantities HER2 promotes normal cell growth. But when a genetic mutation causes HER2 to be over-expressed on the cell surface, certain breast cells are prompted to multiply uncontrollably and invade surrounding tissue.

Women with HER2-positive breast cancer do not respond well to standard therapies. However, molecular diagnostic tests have been developed that measure HER2 protein levels. And for those patients that are found to have HER2-positive breast cancer a new drug Herceptin, that specifically inhibits the HER2 receptor, has been developed. This has greatly improved the patient survival rate.

Personalised medicine is the future...

Children suffering from a form of leukaemia are also benefiting. Eighty-five per cent of children with acute lymphoblastic leukaemia can be cured by the cancer drug 6-mercaptopurine. But a significant number have inexplicably died from the drug. Researchers have discovered that 1 in 10 individuals have an under-active version of the metabolizing enzyme thiopurine methyltransferase (TPMT) and therefore should receive only a fraction of the standard drug dosage. Physicians are now are able to screen for TPMT gene variants before administering these drugs

None of these applications, by the way, has anything to do with Curidium Medica, which is focussed on disorders of the central nervous system. But they illustrate why personalised medicine is generating such excitement.

As well as improving the chances of patients, personalised medicine can also vastly improve the efficiency of healthcare. Physicians have long recognised that patients can respond very differently to the same medication. Take asthma for example. Drugs called Beta-2 agonists are commonly prescribed but are ineffective for about half of all asthma sufferers. ACE inhibitors used to treat hypertension, beta blockers used for heart disease, anti-depressants and statins used to treat cholesterol are all entirely ineffective for a large percentage of patients.

137,000 unnecessary deaths...

Faced with not knowing which patients will respond to which drugs doctors have had little alternative but to adopt a policy of trial and error. This is not only inefficient, but it is dangerous. Each year in the United States patients suffer from over 2 million serious adverse drug reactions, of which 137,000 result in death. Many of these are caused by variations in the functioning of enzymes, the complex proteins that catalyse chemical reactions in the body.

Variations in the genetic coding of enzymes can determine the ability of the body to absorb a drug, and are critical to the acceptable dosage. Now in the first concrete step to tackle this problem the all-powerful American Food and Drug Administration (FDA) has approved a test (the Amplichip Cytochrome P450 test) that can detect variations in two important genes that affect the metabolism of drugs, and thus can guide the appropriate dosage.

Blockbusters generate huge revenues...

Aside from the approval of regulators, the future of personalised medicine clearly depends upon the attitude of the giant pharmaceutical industry. And there are good economic reasons why the industry should support it. Over $50bn per year is devoted to biopharmaceutical research, a very large proportion of which delivers no end product. Too many drug compounds fail to work, or else they work on too few patients to enable them to receive regulatory approval. So huge sums are wasted, and to get back the cost of all this unproductive effort pharmaceutical companies have devoted their efforts to the search for one-size-fits-all “blockbuster” drugs that can generate huge revenues. These, though, are the very drugs that fail to work for many patients. So if less money was lost in the development process, pharmaceutical companies could devote more effort to finding more targeted and efficacious forms of treatment.

Much of the cost of drug development is in the conduct of clinical trials. Clearly huge sums of money could be saved if clinical trials could be made shorter and given a greater likelihood of success. Now using pharmacogenomic data, which measures the interaction between a person’s genetic make-up and their response to drugs, researchers could pre-select patients for studies using only those most likely to respond or least likely to suffer from side effects. This should reduce the size, time and expense of clinical trials.

Viable propositions...

The new techniques behind personalised medicine can also be used to revive the fortunes of those many drugs that have got some way through the development process before being abandoned. Suppose that a drug has been developed that only works for 30% of patients with a certain disease. If genetic data could identify which 30 patients out of every 100 benefit from the treatment, then suddenly it becomes a viable commercial proposition.

With so much in its favour personalised medicine does indeed seem the way forward. The FDA has already acknowledged the relationship between genetic constitution and drug response, and now the Genomics and Personalized Medicine Act is grinding its way through the US Congress. Following the completion of the Human Genome Project in 2003, its premise is that personalised medicine can “target the delivery of healthcare, facilitate the discovery and clinical testing of new products, and help determine a patient’s predisposition to a particular disease or condition.”

It states that many commonly used drugs are typically effective in only 40% to 60% of the patient population and that up to 15% of hospitalised patients experience a serious adverse drug reaction. Arguing that pharmacogenomics has the potential to dramatically increase the efficacy and safety of drugs and to reduce healthcare costs, it intends to pave the way for “continued Federal leadership and agency collaboration, expansion and acceleration of genomics research, a capable genomics workforce, incentives to encourage development and collection of data on the analytic and clinical validity of genomic tests and therapies, and improved regulation over the quality of genetic tests, direct-to-consumer advertising and use of personal genomic information”.

The business of healthcare moves slowly and with justifiable caution. The trend towards personalised medicine raises many questions. Might genetic data be used in ways that are discriminatory? Will healthcare funding, which to date has only paid for the treatment of known diseases, also pay for genetic tests that could prevent the onset of disease? And, of course, just how effective will it prove to be?

Exciting potential...

But it is against this fascinating background that Dr Bruinvels brought Curidium Medica on to the stock market last July via a reverse takeover of an AIM-listed shell called Cielo Holdings. She is the chief executive officer and has been joined by a highly impressive and erudite veteran of the pharmaceutical and biotechnology industry Dr Gosse Bruinsma who is executive chairman and, in a non-executive role, Dr Phyllis Whitely who is a director of the US Personalised Medicine Coalition. They have both seen not only the progress of personalised medicine but also the exciting potential of Dr Bruinvels’ Homomatrix research platform.

Homomatrix is essentially a software-based number crunching engine that analyses human biological data and uses this to find patients suitable for treatment by a particular drug. Last month, Curidium showed what it can achieve with the announcement that it had developed a blood diagnostic test that can sub-classify patients with schizophrenia/bipolar disorder into one of four subgroups. Each subgroup is associated with distinct underlying disease mechanisms and accordingly should be treated with different drugs. This test can enable better and safer treatment of patients; it can allow the pharmaceutical industry to create more effective and targeted drugs; and it can avoid the huge waste of money and effort that sees all too many schizophrenia/bipolar disorder patients take drugs that have no beneficial effects whatsoever.

Massive markets...

Although the Homomatrix tool could be applied more widely, so far Dr Bruinvels and her small team have concentrated on diseases of the central nervous system. This is a huge market, with 1.2% of the population of Europe, American and Japan thought to suffer from schizophrenia, and an alarming 7.8% of school-aged children in the USA having ADHD (Attentive Deficit Hyperactivity Disorder). Existing drug therapies are far from satisfactory, helping only some patients while proving detrimental to others.

There are several ways in which Curidium could exploit the value of Homomatrix. First, it could perform research work in partnership with pharmaceutical and biotechnology companies, helping them to increase the odds of developing successful treatments by enabling a more precise patient diagnosis. The second is to license out Homomatrix as a research platform. Thirdly – and this could be the most profitable approach – it could develop its own treatments, perhaps in partnership with other companies. Or it could take those drug compounds that have failed to make it through all the clinical trials, or else generic drugs, and reformulate them for specific patient groups.

A valuable commodity...

Basically, Curidium Medica gives pharmaceutical companies a way of either improving their research results or else capitalizing more effectively on their drug formulations, and the amount of money that could be saved and the impact on patient care mean that Curidium Medica could be very valuable. Of course, there are plenty of researchers in other organisations that are working on personalised medicine – Perlegen and BG Medicines are two examples in the USA – but Curidium does believe that it is at the forefront, in particular in central nervous system disorders. It also argues that while some companies specialise in identifying biomarkers and diagnostic tools, and others are trying to find novel drug treatments, Curidium is one of a select few that can match the genetic condition with the appropriate drug formulation. And Homomatrix does more than simply identify specific biological markers; by matching these with other demographic and clinical data it can give insights into the evolution and cause of the disease. 

RHPS Verdict: This is an area of massive potential and, given the economic and health benefits, personalised medicine does indeed seem to be the future. With the majority of personalised medicine enterprises in private ownership it is very hard to know the value of Curidium Medica. However, one company in this field, Vanda Pharmaceuticals, is quoted on NASDAQ, where it is valued at $530m in spite of having no revenues and net assets of just $27m. So this is clearly an area of hot interest, and although the shares in Curidium Medica are not so much high risk as an outright speculation (and note also the wide dealing spread) I can see them moving to 10p. So, at their current price of 3.25p, BUY.

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The figures refer to the past and past performance is not a reliable indicator of future results. The past recommendation highlighted here is a small company share.By their nature, such investments can be relatively illiquid and, as a result, hard to trade. This makes such shares more risky than other investments. Please seek independent financial advice if necessary. These figures do not include the bid-offer spread, unless otherwise stated. Since the service began on 01/12/98 running through to 31/07/07, the average overall performance of the shares recommended is up 19.91%.All gains exclude dividend payments and dealing costs, unless otherwise stated. Profits from share dealing are a form of income and subject to taxation. Levels and bases of, and reliefs from, taxation are subject to change, and depend on individual circumstances. Full portfolio available on request. Fleet Street Publications Ltd is authorised and regulated by the Financial Services Authority. FSA No. 115234.

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