A Conneticut Yankee in Prana's court

Prana Biotechnology’s (ASX:PBT, NASDAQ:PRAN ) new American CEO Jonas Alsenas began taking an interest in the company several years ago, when he felt the faint tremors of a paradigm shift in the Alzheimer’s disease research field.

“I became a friend of the company because I was intrigued by what they are doing, and felt that the world at large did not really understand how Alzheimer’s disease occurs and progresses,” Alsenas said.

Prana invited Alsenas to join its board In March this year, and has now handed him the helm, to steer the company’s strategic course.

The Connecticut-based Yankee’s seat-of-the-pants sense that Prana really has cracked the conundrum of the most feared disease of aging has only been reinforced by the company’s latest research findings from its experiments with its original lead compound PBT1, or clioquinol.

Alsenas said Dr Carlos Copazo, a postdoctoral researcher with Prof Colin Masters’ research group at the University of Melbourne, has evidence that clioquinol binds selectively to the amyloid plaques that clog the brains of Alzheimer's patients, rather than binding indiscriminately to metal ions in the body. If Copazo’s preliminary finding is confirmed, PBT1 could be used both as a therapeutic, and to quantify the density of amyloid plaques, allowing clinicians to diagnose Alzheimer’s in living brains.

“Currently, a diagnosis of Alzheimer’s disease can only be made post-mortem,” Alsenas said. “Its progression can only be tracked on the basis of symptoms -- there’s no way of tracking it biochemically.”

Alsenas said the big pharmaceutical company Schering was interested in using iodine-radiolabelled clioquinol as an imaging agent. “It appears to going selectively to the amyloid plaques, where it’s supposed to be exerting the therapeutic effect we want, which proves that it is not working willy-nilly in the brain.”

Alsenas began his career in 1991 with Scheer & Co in Connecticut, where he provided strategic consulting and due diligence for biotech and pharmaceutical industry clients and investors. Most recently, he held a senior role at ING Investment Management in New York, where he co-managed a hedge fund with an emphasis on investments in biotech. In 1998, The Wall Street Journal named him an 'all-star analyst' for his stock-picking and earnings accuracy.

Prana’s appointment of an American CEO follows on from its listing on the Nasdaq in 2000. Alsenas said it was “not a US vs Australia thing”. The board had acknowledged several years ago that both the science and the industry were global in nature, and players needed to think globally, rather than competing as local manufacturers. “One of the things Prana needed was capital, and the US is the world’s largest and most sophisticated capital market,” he said.

The ability to interact directly with the US Food and Drug Administration was also a strategic imperative. “That is not to say Prana will cease to be Australian. Our core competency in research, and much of our operational management team, is still in Australia.”

Alsenas said the pre-clinical toxicity data on Prana’s new lead compound, PBT2, was looking “very clean” and Prana expected to take the new synthetic molecule into Phase I clinical trials early next year, with results expected to be available late in the year.

Last year’s publication of Phase II trial data on clioquinol in the journal Archives of Neurology had been a key event for Prana, on several levels. It proved, for the first time, that a drug could actually slow patients’ progression to Alzheimer's, and provided further validation for the hypothesis of Prana co-founder Dr Ashley Bush that metal ions -- zinc and copper -- were key players in the pathogenesis of Alzheimer's.

This month's settlement of Prana’s patent with Greek pharmaceutical company Gerolymatos, which gave Prana the rights to market clioquinol in Japan and the US, the world’s largest pharmaceutical market, had also been critical to its business strategy. “It didn’t make sense for us to plan on advancing PBT1 any further until we settled with Gerolymatos,” Alsenas said.

The importance of PBT1 was that the company already had indications of efficacy -- PBT2 looked promising, but had yet to be tested in humans. In a perfect world Prana could consider using PBT2 to obtain proof-of-concept, and the company could have results in several years that would demonstrate it has a whole new impact class of metal-chelating drugs, with potential applications to other neurodegenerative disorders like Parkinson’s disease.

Prana would still need to do a proof-of-concept trial on PBT2. With the current strategy of progressing PBT1 through clinical trials, it could have a drug ready for the market by the time PBT2’s potential is confirmed.

If PBT2 subsequently proved to have superior activity as an Alzheimer's therapeutic, revenues from sales of PBT1 would help fund its development.