Allon begins its first human clinical trials of AL-208, reports second-quarter net loss

By Lisa Kerner

Charlotte, N.C., Aug. 11 - Allon Therapeutics, Inc. said it continued to achieve all of its milestones during the second-quarter 2006, including the start of patient dosing in its first phase 2 human efficacy clinical trial of AL-208 as a treatment for the mild cognitive impairment (MCI) following coronary artery bypass graft (CABG) surgery.

"Although this trial will specifically determine whether AL-208 works to prevent or reduce MCI post-CABG, this is the first of several human clinical trials that will evaluate the effectiveness of our drugs in different neurodegenerative diseases and conditions," president and chief executive officer Gordon McCauley said in a company news release.

The AL-208 phase 2 trial will evaluate the drug's safety and effectiveness at preventing or reducing MCI on CABG surgery patients, a potential $500 million U.S. market.

Allon recently added Canadian sites to the trial's second stage, which is a placebo-controlled, double-blind, parallel-group evaluation of a single dose of AL-208 in 200 patients at 20 sites.

The company also completed patient dosing in a phase 1b human clinical trial of multiple doses of AL-208 in the treatment of neurodegenerative disease.

By the end of the year, the company expects to begin phase 1b and phase 2 clinical trials evaluating AL-108 as a treatment for Alzheimer's disease.

For the three months ended June 30, Allon's net loss increased to $2 million, or $0.06 loss per share, from $1.3 million, or $0.05 loss per share, from the prior-year period.

Research and development expenses for the three-month period were up at $1.2 million, from $830,576 in the second-quarter 2005.

The company reported a net loss of $3.6 million, or $0.11 loss per share, for the six months ended June 30, compared to a net loss of $2.5 million, or $0.09 loss per share, for the same period in 2005.

Research and development expenses for the six-month period rose to $2.4 million, from $2.1 million for the same period in 2005.

Allon attributed the research and development increases to timing of clinical trial expenses as well as the advancement and expansion of the clinical development programs for both AL-108 and AL-208.

At June 30, the company had cash and short-term investments of $5.0 million, down from $7.3 million at March 31 and $9.5 million at Dec. 31, 2005.

The company said it believes its cash and short-term investments at June 30, with expected interest income, will be sufficient to fund operations and commitments into the second half of 2007. Allon is a clinical-stage biotechnology company located in Vancouver.

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