BioXcel Therapeutics down 67% amid regulatory inquiry into BXCL501 development

In a regulatory 8-K filing, BioXcel Therapeutics states: “In December 2022, the FDA conducted an inspection of one of the clinical trial sites in the Phase 3 TRANQUILITY II clinical trial, where the principal investigator enrolled approximately 40% of the subjects participating in the trial. At the conclusion of this inspection, the FDA issued an FDA Form 483 identifying three inspectional observations. These observations related to the principal investigator’s failure to adhere to the informed consent form approved by the Institutional Review Board for a limited number of subjects whose records the FDA reviewed, maintain adequate case histories for certain patients whose records the FDA reviewed, and adhere to the investigational plan in certain instances. For example, the FDA cited the principal investigator’s delay in informing the sponsor’s medical monitor or pharmacovigilance safety vendor of a serious adverse event for one of the subjects, which report was made to the Company’s vendor outside of the 24 hour time period prescribed by the clinical trial protocol. The principal investigator for this clinical site responded to the FDA observations within the time period requested. The FDA inspection remains open, however, as the FDA has not issued an Establishment Inspection Report. In May 2023, it came to the Company’s attention that this same principal investigator in the TRANQUILITY II clinical trial may have fabricated email correspondence purporting to demonstrate that the investigator timely submitted to the Company’s pharmacovigilance safety vendor a report of an SAE from a different subject than the one cited in the FDA Form 483, and purporting to show that the vendor had confirmed receipt. Upon receipt of this information, the Company promptly initiated an investigation and recently received confirmation that the principal investigator fabricated the email correspondence related to the timing of the reporting of this SAE to the Company’s pharmacovigilance vendor to make it appear as though this SAE had been timely reported to the pharmacovigilance vendor as required by the clinical trial protocol. The Company also confirmed that this SAE had been timely entered into the electronic data capture system, even though the SAE had not been separately reported to the Company’s pharmacovigilance safety vendor within the 24 hour timeframe required under the protocol. In connection with this ongoing investigation, the Company was made aware that the fabricated email correspondence was provided to the FDA by the principal investigator’s employer during the on-site inspection in December 2022. After unblinding of the data, the Company determined that the SAE that was the subject of this fabricated correspondence between the principal investigator and the Company’s pharmacovigilance vendor occurred in a subject in the placebo arm. This principal investigator has not participated in any other clinical trial sponsored or conducted by the Company. Moreover, the study was designed such that trained study staff other than principal investigators were to conduct assessments of the primary efficacy measure. The Company is currently in the process of conducting an investigation into protocol adherence and data integrity at the principal investigator’s trial site and is in the process of retaining an independent third party to audit the data collected at the site. The Company’s ongoing investigation and/or the planned independent audit may uncover new findings regarding the integrity of the trial data from this principal investigator’s site, the accuracy of safety or efficacy findings, or the usability of the data in connection with a marketing application. The Company plans to complete its investigation as soon as possible, although the Company can provide no assurance regarding the timing of the completion of its own investigation or the timing of the completion of the planned independent audit of the trial site. Further, the Company has notified the FDA of these findings and the steps it intends to take to validate the integrity of the data generated by this investigator for the TRANQUILITY II trial. The timing of the Company’s marketing application and prospects for regulatory approval of BXCL501 for the acute treatment of agitation associated with dementia in patients with probable Alzheimer’s disease may be adversely impacted by these developments. For example, even if the Company’s investigation and the independent audit conclude that data from the TRANQUILITY II trial have not been affected or compromised by the principal investigator’s actions or other deficiencies at the trial site, the FDA may not accept or agree with the Company’s conclusions or analyses, or may interpret or weigh their importance differently. Further, if the Company or the FDA determines that there are issues with data integrity and/or compliance with good clinical practice requirements at the trial site, the Company may be unable to use some or all of the subject data generated at this clinical site to support a marketing application. If all or a substantial portion of such data were discarded, the TRANQUILITY II trial may no longer be adequately powered for statistical significance and the Company may need to conduct a new clinical trial. If the Company conducts a new Phase 3 trial, such trial may have different safety or efficacy results from the topline data the Company is announcing today. Topline data from the TRANQUILITY II trial, including results from subjects at this principal investigator’s site, may not be predictive of the results in any new trial. Further, any investigation, disqualification or debarment of, or proceeding or action against the principal investigator, or any investigation, proceeding or action against the Company, could further delay development and approval of BXCL501 for this indication, and otherwise have a material adverse effect on the Company, its financial condition, results of operations and prospects.” Shares of BioXcel Therapeutics are down 67% in pre-market trading following the disclosure that accompanied topline results for BXCL501 in acute treatment of Alzheimer’s Disease-related Agitation.