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Phase IIa Study Initiated of Dexanabinol in Reducing Post-surgical Cognitive Impairment

Iselin NJ, April 8, 2003 - Pharmos Corporation (Nasdaq: PARS and Nasdaq Europe: PHRM) announced today it has begun dosing patients in a Phase IIa feasibility and safety study to determine the effectiveness of dexanabinol in reducing post-surgical cognitive impairment (CI). No approved medication is currently available to prevent the onset of CI, a condition that occurs in a significant percentage of patients undergoing coronary artery bypass grafting (CABG) under cardiopulmonary bypass (CS-CPB) surgery. Pharmos is simultaneously testing the effectiveness of dexanabinol as a neuroprotective treatment for traumatic brain injury (TBI) in an international Phase III study, patient enrollment for which is expected to be completed in 2003.

"Data from preclinical and clinical testing of dexanabinol have shown the compound to have powerful anti-inflammatory and neuroprotective properties in the brain, all of which are critical in preventing cell death associated with ischemic conditions common to many central nervous system disorders," said Haim Aviv, Ph.D., Pharmos Chairman and CEO. "The multiple mechanisms of action inherent in dexanabinol and in proprietary derivative compounds are unique. Pharmos intends to exploit this advantage commercially by targeting appropriate therapeutic areas that represent significant market opportunities, such as TBI and post-surgical CI prevention."

Clinical evidence of dexanabinol's therapeutic potential in preventing CI was demonstrated in Pharmos' Phase II TBI trial, completed in 2000. As an important secondary outcome of the Phase II TBI trial, patients treated with dexanabinol showed statistically significant improvement in cognition and orientation as measured by the Galveston Orientation and Amnesia Test at three and six months after injury, compared to placebo. In preclinical findings, dexanabinol was an effective neuroprotectant in animal models of focal brain ischemia demonstrating robust sparing of hippocampal cells pivotal to cognition.

Cognitive decline may develop following CS-CPB as a result of microemboli-triggered ischemic events and related inflammatory processes. For certain subsets of patients, the risk of cognitive impairment is significant, compromising recovery and adding to rehabilitation costs. Development of post-surgical CI also increases the risk of developing future dementia.

About Post-Surgical CI Each year over one million patients worldwide undergo CS-CPB operations(1). In the United States, over 350,000 coronary artery bypass surgeries are performed each year(2), making it the most frequent major surgical procedure performed in hospitals. As mortality from these surgeries has fallen in recent years, medical attention has increasingly focused on morbidities associated with coronary surgeries, especially impairment of cognitive function experienced by a high percentage of these patients. Certain studies show that eight days after surgery as many as 50% of the patients may suffer cognitive defects(3), such as inability to concentrate, memory loss, a slowdown in response and difficulty in returning to pre-surgical functioning. Importantly, even after 12 months, cognitive deficits persist as a source of disability in as many as 30% of the patients(4). Recent long term longitudinal studies indicate that a significant proportion of patients may continue to deteriorate over time, with cognitive deficits continuing up to five years after surgery . Age and other factors, such as diabetes, affect the frequency of CI.

About the Trial The trial is underway at three leading medical centers in Israel. The exploratory, Phase IIa, double-blind, placebo-controlled trial will enroll up to 200 patients undergoing CS-CPB. Patients are being randomized one-to-one to receive a single dose of either 150 mg. dexanabinol or placebo prior to initiation of CPB. Each patient will be evaluated prior to surgery, at discharge, at six weeks, and at three months following surgery to assess the incidence and degree of post-surgical CI. The degree of cognitive impairment will be assessed using a sophisticated and validated battery of computerized neuropsychological tests including attention deficit, memory loss and speed of reaction. Among other inclusion/exclusion criteria, patients included in the study will be age 60 or older who are candidates for elective CS-CBP and who do not show signs of CI or dementia according to the DSM-IV (Diagnostic Statistical Manual, version IV) criteria for dementia, and scoring on the Mini Mental State Examination, prior to surgery.

The primary efficacy analysis will compare the reduction in cognitive deficit in the dexanabinol-treated group compared with the placebo group. The additional neuropsychological secondary efficacy analyses will serve to evaluate and compare quality of life and assess additional functional outcome between the treated and placebo patients. An independent safety committee will monitor the data on an ongoing basis to ensure patient safety.

About Dexanabinol Dexanabinol is the first neuroprotective compound under development from Pharmos' library of synthetic tricyclic dextrocannabinoid compounds. Dextrocannabinoids lack binding activity in the two known cannabinoid receptors, CB1 and CB2, and as a result, this family of compounds does not show the psychotropic effects seen with naturally occurring cannabinoids. Drug candidates in this family have three main actions: they block the activation of specific ion channels in nerve cells by binding to NMDA receptors as non-competitive antagonists, inhibit inflammatory mechanisms, and operate as antioxidants. These three properties enable dextrocannabinoids to reduce necrosis and apoptosis caused by brain trauma, ischemia and a range of neurodegenerative disorders. The Company's focus on dexanabinol and derivative compounds is wide ranging, and a number of dextrocannabinoid compounds are being evaluated in preclinical models for a variety of indications

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