Avastra clinical trial halted

Sydney biomaterials company Avastra (ASX:AVS) has halted its Bioweld human clinical trial due to unexpected results in its long-term animal study, although the company is still unsure what caused the unexpected results.

"It's a major setback for us," said Avastra managing director Paul Ralph. "But that's what animal studies are for. So you don't risk people."

The company has indicated that the results from the long-term animal study are unrelated to the problem encountered earlier this year when the first clinical patient presented with a severe drug reaction following surgery with the Bioweld Tube, delaying the clinical trial by six months.

Avastra's BioWeld technology -- developed at Macquarie University and the Microsearch Foundation of Australia -- uses a protein solder which is activated by laser light to join arteries and veins.

The long-term animal study in which the unexpected results were found was a six month study involving 120 rats whose abdominal aortas were anastomosed (joined) to test for long-term patency (free blood flow through the anastomosis). Out of those 120, 60 rats had aortas that were re-anastomised end-to-end using the Bioweld Tube and the other 60 were used as a control group whose aortas were anastomosed conventionally using sutures.

Of the 59 rats re-anastomised with the Bioweld Tube that were harvested at the end of the six month period, six did not have aortas and two had occlusions (blockages) of the aorta, said Ralph.

"We had rats that didn't have aortas. That's pretty unexpected," said Ralph.

With no blood flow from the abdominal aorta into the hindquarters, rats would normally lose mobility in their back legs. However, this did not happen and the rats functioned normally, said Ralph.

"So obviously, this has been a very slow atrophy of the patency of the aorta. But we don't know what caused that. Whether it was a bacterial infection, or what's actually done it, we don't know," he said.

Full results of the long-term animal study are due by the end of August this year when the control group is due to be harvested. If that group shows a similar patency failure rate to the Bioweld group then it puts into question the validity of the rat model for long term patency studies, said Ralph.

Data from all Bioweld studies will be presented to an independent expert panel for review and recommendation in September. A board meeting will then be held to determine the company's direction.

Cost reductions

In the meantime, Avastra is reducing its ongoing operating costs, with cuts of $250,000 in the last two weeks in recurrent annual spending.

"We've taken steps to reduce outgoing costs associated with the clinical trial process and some other inputs," said Ralph.

The company anticipates that its net cash outflow will fall to about $130,000 per month following these reductions.

Avastra's other research programs, the end-to-side in vivo research in sheep models as well as the Benz Stent and Bioweld drug delivery systems are continuing.

Avastra listed in June 2004 after raising AUD$8 million in an IPO priced at $1.00 per share. But the company's share price has slumped after a lacklustre debut at $0.99, and at the time of writing shares were trading at $0.165.