Neurodegenerative diseases like Alzheimer’s disease affect an estimated 12 million people around the world. While heart disease and cancer rates have been declining, these kinds of diseases have become increasingly prevalent in today’s society.
Innovus Pharmaceuticals Inc. (OTCQB: INNV), an emerging commercial stage pharmaceutical company focused on over-the-counter medicine and consumer care products, recently announced the launch of its brain health supplement RecalMax™. Unlike many other OTC products, the supplement is supported by compelling clinical evidence and is backed by a proven robust marketing platform (Beyond Human Platform) that management believes will turn it into a $5M/year product.
In this article, we will take a closer look at RecalMax™ and the company’s plans to grow the product alongside its robust and expanding portfolio.
Clinically Proven Solution
Innovus Pharma’s RecalMax™ was tested in a four-month human clinical trial on 72 patients with low memory and learning. After taking one capsule twice a day for 16 weeks, patients reported a 115% increase in the recall of words and names, a 49.5% increase in maintaining thoughts when distracted, and a 35% increase in processing speed. The supplement was also well-tolerated with no serious adverse events reported.
“Having clinical data showing improvement in memory and learning differentiates RecalMax™ from the rest of the products on the market and gives it the credibility needed to make a strong entry into the market,” said Dr. Bassam Damaj, President and CEO of Innovus Pharma.
RecalMax™ is a patented oral low-dose formulation of Arginine and Citrulline with the natural absorption enhancer Bioperine®. L-Arginine is an amino acid that changes into nitric oxide in the body, which is a powerful neurotransmitter that helps blood vessels relax and improves circulation. These effects are enhanced by Bioperine® – a black pepper extract that enhances the bioavailability of nutrients by at least 30%, according to BioPerine®.
Significant End Markets
The global neurodegenerative diseases market is expected to grow from $8.8 billion in 2012 to $11 billion by 2018, according to Research and Markets, which represents a 3.2% compound annual growth rate. Parkinson’s and Alzheimer’s disease are the two most prevalent medical conditions falling into the category and are characterized by neurological problems affecting memory, learning, and nerve function – eventually leading to premature death.
The current market for Alzheimer’s treatments generates a large percentage of the overall neurodegenerative disease revenue. However, these treatments only treat the main symptoms of Alzheimer’s — memory loss, confusion, and cognitive problems — rather than the actual cause.
Aricept, developed by Eisai and Pfizer (NYSE: PFE), is the most popular of these treatments. Aricept is a cholinesterase inhibitor which prevents the breakdown of acetylcholine, a chemical messenger needed for learning and memory. By keeping acetylcholine levels elevated, Alzheimer’s symptoms can be held at bay for an average of six to twelve months in roughly half of the patients.
Aricept had peak sales of $2.4 billion in 2010, but numbers have fallen dramatically over the years after its patent expiration. Today, generic Aricept is widely available from generics companies such as Actavis and Teva Pharmaceuticals.
Namenda, which was first synthesized by Eli Lilly & Co. (NYSE: LLY) in 1968, is another common treatment for Alzheimer’s disease. Namenda attempts to protect the brain’s nerve cells against glutamate, a chemical messenger which is released in excess amounts by cells damaged by Alzheimer’s disease and other neurological disorders. If glutamate binds to a patient’s brain cells, it allows calcium to freely enter the cells, causing cell degeneration.
Namenda is currently manufactured by Allergan (NYSE: AGN), through its subsidiary Forest Laboratories. Last year, sales of Namenda hit $759 million in the U.S., making it the company’s fourth largest revenue producer among drugs individually reported.
Innovus Pharma estimates that the immediate market for a product like RecalMax™ could be worth around $3 billion, since it helps treat some of the major endpoints associated with neurodegenerative diseases. Management believes that it can capture enough of the market to generate about $5 million in annual revenue by deploying the treatment across its well-established Beyond Human Platform and online marketing channels throughout the U.S. and other regions of the world.
Innovus Pharma trades with a market capitalization of just $26 million with sales of about $1 million during the second quarter of this year. With RecalMax™ expected to generate upwards of $5 million in annual sales, the product launch could significantly increase the company’s revenue and its subsequent market capitalization. Investors may want to keep a close eye on the stock given this potential to improve shareholder value alone.
In addition to RecalMax™, the company has a robust pipeline of commercial-stage and up-and-coming products to watch. The most notable is its ANDA application with the FDA for the approval of FlutiCare™; a decision is expected in the very near future. FlutiCare™ is a prescription strength OTC treatment for non-allergic rhinitis and would compete with blockbuster drugs like Glaxosmithkline plc’s (NYSE: GSK) Flonase.