Incannex share price pops 9% on FDA news

The medicinal cannabis drug development company came out with some positive developments from its FDA meeting…

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Key points

  • Incannex shares hit an intraday high of 51 cents, but have since fallen a touch to 49.5 cents, up 8.79%
  • The company received positive notes from its pre-IND meeting with the FDA, with animal studies not required for IHL-42X
  • Incannex will now look at the adjustment of clinical trial designs to open an IND

The Incannex Healthcare Ltd (ASX: IHL) share price is soaring during mid-afternoon trade.

This follows the company's positive pre-investigational new drug application (pre-IND) meeting with the United States Food and Drug Administration (FDA).

At the time of writing, the healthcare company's shares are trading at 49.5 cents, up 8.79%.

FDA responds to IHL-42X pathway

According to the company's announcement, Incannex reported it received positive feedback from the FDA pre-IND meeting regarding the regulatory pathway for its IHL-42X.

Incannex's IHL-42X is a novel therapy that comprises dronabinol and acetazolamide. The medical therapy is targeted for the potential treatment of obstructive sleep apnoea (OSA) in adults.

In February, Incannex submitted a pre-IND meeting package and meeting request to the FDA. This included an overview of the development program and questions relating to regulatory requirements for opening an IND application.

To conduct clinical trials for any medical product in the United States, an IND must be opened.

The FDA provided "guidance on Incannex's proposed long-term development strategy, as well as specific parameters to demonstrate safety and efficacy in phase 2 and 3 pivotal studies", the company said.

Furthermore, the FDA agreed that Incannex doesn't need to conduct studies in animals for opening an IND for IHL-42X. This will save time and cost to the company which can now proceed with the adjustment of clinical trial designs to open an IND.

What did management say?

Incannex chief scientific officer Dr Mark Bleackley welcomed the feedback, saying:

The FDA's interest in IHL-42X as a potential therapy for OSA was extremely encouraging.

…The agency's responses to the specific questions we posed allow us to revise our clinical trial protocols, to ensure that we are running highly efficient studies that generate the type and amount of data the FDA will require in a future marketing application.

The results from the pre-IND meeting will shape the IHL-42X development program over the coming months.

Incannex share price snapshot

Over the past 12 months, the Incannex share price has rocketed by around 83% in value.

However, year to date, its shares are down 20%.

The company's shares reached a multi-year high of 75.5 cents in March, before giving up their gains.

On valuation metrics, Incannex has a market capitalisation of around $633 million.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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