Posted with permission from STAT

The executives packed into the room, eager to hear the good news on their blockbuster-to-be.

Medivation, a California startup, was developing a treatment for Alzheimer's disease, and pivotal results from a major clinical trial were finally available. An earlier study, conducted in Russia, had generated what Alzheimer's experts hailed as the best results the field had ever seen. Dr. David Hung, the CEO, believed he had a billion-dollar product.

But the results disclosed that day in 2010 were disastrous. The drug, Dimebon, failed all five of the trial's key metrics, performing even worse than placebo on two of them. Medivation lost more than $1 billion in value in the first hour of trading as the company's leaders struggled to process the startling failure.

By shifting focus to oncology, Hung was able to save Medivation - and, eventually, sell it to Pfizer for $14 billion - in a rebound that made him something of a legend in biotech circles, not to mention a very wealthy man. But Hung, revered by his colleagues for his almost childlike sense of scientific wonder, never shook his ambition to develop a treatment for Alzheimer's.

So he's doing it again - headed for another crowded room and another make-or-break clinical trial. This time it's with Axovant Sciences. Axovant's big trial, scheduled to read out this month, is the year's most hotly anticipated event in biotech. If the drug succeeds, Axovant's stock price could rise tenfold, analysts say. If it fails, it could be Dimebon all over again.

"I don't know how you write about this without comparing David to Captain Ahab," said Baird analyst Brian Skorney, who gives Axovant's drug 60 percent odds of success. "I don't think he wanted Medivation to be an oncology company; he wanted it to be an Alzheimer's company. And this is his shot at doing that."

Hung, 60, entertained scores of job offers after Medivation's sale last year. He picked Axovant, joining as CEO in April. News of his hiring sent Axovant's value up $400 million in a day.

Hung's colleagues, past and present, effuse about his warmth, his unflappability, and his unwavering commitment to Alzheimer's, which has long been a woebegone pursuit for drug developers. There hasn't been a new therapy approved in 15 years, as more than 99 percent of treatments in development have failed.

Axovant's drug, even in the best-case scenario, is not a cure for Alzheimer's. If it works as hoped, it would postpone, for a while, patients' decline in mental and physical function. And that's a sizable if.

Called intepirdine, the drug has failed in four previous clinical trials. Other drugs that work the same way have similarly fallen short. Hung's big bet is that a glimmer of promise in an earlier intepirdine study can be reproduced on a grander scale.

In an interview with STAT, Hung was reticent to discuss his last failure in Alzheimer's, steering questions back to Axovant's talking points in the manner of a well-drilled corporate executive. But current and former colleagues say Dimebon's derailment was a defining moment in his career, a failure both catastrophic and instructive.

At an all-hands meeting on his first day at Axovant, Hung spoke at length about the lessons of Dimebon, stressing that this company, unlike Medivation, has a contingency plan, according to a person who was in the room.

Axovant is "keeping all of our fingers and toes crossed" that intepirdine succeeds, Hung said said at the BIO International Convention in June. But the company is prepared for failure. There are other drugs in the pipeline, and there is cash in the bank to buy new ones, making biotech's most famous turnaround artist confident he can build Axovant into a big business.

"No matter what happens," Hung said, "I'm sure we'll find a way to make some of our assets work, and we'll get there."

It was a violin teacher who gave Hung his start in Alzheimer's drug development.

In 2002, Hung was a free agent after selling his medical device company and was looking for a way back into biotech. A trained oncologist, scratch golfer, and frequent tennis player, Hung was adding the violin to his repertoire, and his instructor introduced him to a Russian scientist with some curious theories about a decades-old antihistamine.

Sold for years in the Soviet Union as a remedy for hay fever, Dimebon had found new life in the lab of biochemist Sergey Bachurin, who discovered that the drug improved cognition and seemed to arrest signs of aging in mice. Convinced the old therapy could do the same in humans, Hung formed Medivation and gave Bachurin a stake.

Within five years, Hung looked prescient. In a 2007 trial conducted in Russia, Dimebon demonstrated remarkable benefits compared with placebo, improving mental and physical performance and posting "the best data that a phase 2 Alzheimer's study has ever shown," Dr. Rachelle Doody, then of the Baylor College of Medicine, told The New York Times.

The results, published in the Lancet the following year, made a splash in neuroscience, where experts puzzled over just how Dimebon worked but remained in awe of its documented effects. Pfizer wrote Medivation a nine-figure check to get in on the program, and the pair mounted an ambitious slate of studies to prove Dimebon really was the left-field success its Russian trial suggested.

And then it failed, and spectacularly. First in the 2010 Alzheimer's trial, then in Huntington's disease, and finally in a year-long study whose disappointing 2012 conclusion led Pfizer to wash its hands of Dimebon.

"We were devastated by that blow," Hung recalled at the biotech conference in June.

Most experts concluded that the Russian clinical trial had been tainted, the data simply wrong.

"The rise and fall of Dimebon remain enigmatic to me," said Dr. Samuel Gandy, associate director of the Mount Sinai Alzheimer's Disease Research Center, who was enticed by the Russian result and perplexed by its irreproducibility. "The most likely explanation is that the blind was somehow broken and the benefit - which always seemed too good to be true - was inauthentic in some way."

Hung, who soon had to lay off about 20 percent of his employees, shrewdly pivoted to oncology to save his company. Privately, though, he maintained that Dimebon might still have promise, current and former colleagues said. The Phase 2 had just been too positive to be a fluke; perhaps a larger, longer, differently designed trial could at last tease out the benefit that caught his eye back in 2002.

Colleagues spotted Hung at neuroscience conferences long after Medivation had officially abandoned the field. As his company turned its attention to the prostate cancer drug MDV3100, now approved as Xtandi, Hung stayed plugged into the world of Alzheimer's, waiting for another shot.

He has that now, at Axovant.

Taking over Axovant brought Hung into the world of one of biotech's brightest young things.

Vivek Ramaswamy, a 32-year-old former hedge fund manager, founded Axovant three years ago as the test case for a tricklock spin on capitalism designed to outsmart the entire drug industry. Ramaswamy's privately held parent company, Roivant, scours the pipelines of drug makers large and small, scouting for projects that they've abandoned. He buys up those he believes have promise, builds startups around them, and then takes those companies to Wall Street.

The model has thus far ticked all available boxes of success - short of actually bringing a drug to market. Axovant's initial public offering was biotech's biggest ever in 2015, and Myovant, a sibling company dedicated to women's health, pulled off the largest IPO of 2016. Roivant, formed around the table of a Manhattan Mexican restaurant on Cinco de Mayo 2014, just raised $1.1 billion to replicate the process on a grander scale.

There's skepticism, as one might expect for an empire built by millennial financier whose business model is predicated on being cleverer than the competition. But that's where Hung, a known and largely beloved quantity in biotech, comes into play.

Hung's former colleagues speak with reverence of his leadership, praising his ability to wend through moonshot meetings with ambitious scientists and bottom-line discussions with cost-conscious bean counters. At Medivation, he memorized the names of nearly every employee, even as the firm ballooned from a startup to a multibillion-dollar biotech with a commercial operation.

"We would do all-hands meetings and people would just look at him as though he walked on water," said Jennifer Jarrett, who served as Medivation's chief financial officer until Pfizer absorbed the company.

Most important, perhaps, he brought to Axovant his track record of bringing a drug to market and building value in a startup. And, thanks to Dimebon, he had a proven ability to move on from failure.

"We see the appointment of David Hung as a positive for both Axovant and investors, particularly vis a vis credibility," Cowen analyst Ritu Baral wrote in a note to clients when Hung took over as Axovant CEO.

And with his arrival came a quiet rebranding. Hung brought his own team of industry veterans to Axovant's upper ranks, many of them Medivation alumni who moved cross-country to join him in New York.

At the same time, Ramaswamy's Wall Street-friendly focus on the minutiae of up-front payments and trial timelines gave way to Hung's loftier rhetoric and expansive ambition.

"If [intepirdine] hits, and we build out our R&D organization, we're going to be swinging for more fences," Hung said at BIO. "We don't need more base hits. Life's too short for that. We need more home runs."

Axovant had made its bet on intepirdine - and set the crucial clinical trial in motion - long before Hung joined the company.

The drug, developed by GlaxoSmithKline, targets a receptor in the brain called 5-HT6. Block that and you stimulate the release of a memory-boosting chemical called acetylcholine, thus ameliorating the worst symptoms of Alzheimer's for a time.

The problem was, intepirdine didn't work. In four clinical trials, the drug failed to meaningfully differentiate itself from placebo. In 2010, despite the objections of some of its scientists, GSK terminated work on the program.

But Ramaswamy saw potential in intepirdine. In the fourth trial, which looked at 684 patients, the drug missed its overarching goal but did demonstrate a marked effect on a subgroup of patients who were also taking Aricept, an Alzheimer's drug approved in 2003.

The drugs, in theory, should complement each other well. While intepirdine is meant to boost the amount of acetylcholine in the brain, Aricept works by preserving what's already there.

So Ramaswamy licensed intepirdine from GSK for $5 million plus sweeteners and royalties and embarked on a 1,300-patient do-over, studying the drug only in the population that showed a glimmer of earlier promise.

To some outside experts, the plan suggests an inability to learn the lessons of Alzheimer's failures past, including Dimebon.

For one, drawing conclusions from one patient group in any multifaceted study is inherently fraught. The perceived effect is overwhelmingly likely to be beyond what's plausible, said Dr. Lon Schneider, a University of Southern California psychiatric professor who leads the California Alzheimer's Disease Center.

"That's called the winner's curse in statistics," Schneider said. "It's analogous to flipping a coin 10 times and getting seven heads. That's [statistically significant], but you wouldn't extrapolate it and assume you'd get 70 heads with 100 flips."

Then there's the whole concept of blocking 5-HT6 to boost cognition. To the extent Dimebon worked at all, it seems to have done so by hitting the same neural mechanism, only more weakly, said Ilya Bezprozvanny, a physiology professor at University of Texas Southwestern who has studied the drug. And that didn't prove beneficial to patients.

Attacking the same target with more powerful weaponry has also failed. Pfizer scrapped a 5-HT6 program of its own after concluding it had no hope of meeting its clinical goals. Danish drug maker Lundbeck posted positive mid-stage data with a similar drug only to see it fail across the board in a larger trial.

"As a general rule, drugs of a similar mechanism tend to either work together or fail together," said Dr. Gbola Amusa, a biotech analyst at Chardan Capital Markets who has argued that Axovant is overvalued.

But Hung believes those prior failures have no bearing on intepirdine. Pfizer tested its drug at too low a dose and made the mistake of enrolling in Alzheimer's patients with psychiatric impairments, Hung said, a population Axovant has excluded.

And Lundbeck committed a cardinal sin of drug development, he said: The company got a positive result by giving patients 90 milligrams of its drug each day, but, worried about toxic side effects, reduced the dose to 60 milligrams in its Phase 3 trial. The unsurprising result, Hung said, was failure.

All these debates will be moot when Hung gathers his team to look at intepirdine's trial results later this month. For Axovant, success would bring an instant and lucrative validation of its business model. For Hung, it would mark an ideal start to a risky third act in a remarkable career.

Failure would be devastating. But Axovant says it's prepared. And Hung has no intention of letting a blow drive him out of the field again.

"I guess I didn't learn enough from the Dimebon failure to shy away from Alzheimer's disease," Hung said, with a laugh, at the BIO conference. "I just think that's such an important disease that, again, someone's got to do it. So it might as well be me."