Much Of What You Know About AQXP Is Probably Wrong

About a week ago, Aquinox Pharmaceuticals

AQXP

shocked the markets after it rocketed up to from under a dollar per share at the previous Thursday's close to more than $40 by Monday morning. The jump came after the company unveiled promising phase 2 trial results for a drug it has been developing to combat interstitial cystitis (IC), a painful bladder condition. However, AQXP's massive gains would not hold. The stock declined steadily throughout the week before finally settling at around $20. It seems likely that the market, at least initially, overvalued the drug company's potential interstitial cystitis treatment. We decided to ask Benzinga readers some fundamental questions about IC and the medication, and we found that many people still seem to be misinformed.

Total Addressable Market

In a poll conducted last Thursday, we asked readers to estimate the TAM for Aquinox's drug. A plurality (44 percent) thought that it had a market of more than 1,000,000. Only 19 percent gave the correct range of 200,000 to 500,000 -- analysts have told Benzinga that there are probably between 300,000 and 400,000 patients currently diagnosed in the United States.

The Causes

When asked about the reason people develop IC, over 40 percent said that the condition stemmed from problems with the lining of the bladder. While it's true that this is one possible cause, the reality, according to

WebMD>/a> is that it's "unclear" what triggers the disease. Most people seemed to be unaware of the fact that interstitial cystitis is not a particularly well-defined condition. In fact, there is no test to determine whether or not a patient has the ailment -- a doctor typically makes the diagnosis after ruling out other, better-understood causes of bladder pain. Only about a quarter of survey respondents indicated that the exact causes of IC are unknown. Alternatives Finally, we asked Benzinga readers how many other drugs currently on the market they believed were used to treat interstitial cystitis. The presence of other drugs, of course, would make Aquinox's developing treatment less valuable than if were the first to the scene. Again, the most common response was incorrect. A third of those polled thought that AQXP's medication would be the first to address interstitial cystitis, and another third believed that there was only one other oral treatment on the market. In reality, at least two other oral medications are used to placate the disease, while several others are used to treat symptoms. Amitriptyline, which controls bladder spasms, and Pentosan, which gradually relieves other symptoms, are probably the two most common drugs used to treat IC patients. In addition to those, painkillers and antihistamines are sometimes prescribed or suggested to help with other symptoms. At $20 per share, AQXP's gains over its price of just over a week ago are still tremendous. Nevertheless, its fall from its $40 peak demonstrated that traders may have jumped aboard too soon, without knowing the fundamentals of the new drug or the disease it was intended to treat. The results from Benzinga's poll last week has only provided further evidence for that theory.

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