Biotech Stock Mailbag: Rexahn Pharma

BOSTON (TheStreet) -- The Biotech Stock Mailbag is overflowing with so many reader questions that a bonus Thursday edition is necessary. I've also updated the Biotech Stock Mailbag Readers' Portfolio (BSMRP) below, so make sure to check that out. (Hint: The BSMRP's performance is illin' a bit.)

The regular installment of the Mailbag will be delivered tomorrow, as always.

Konstradt M. writes, "I have always valued your insights as you refuse to toe the popular line. Personally, I don't agree with the abuse that you receive simply because you refuse to mince your words. I respect any man that has the courage to call a spade a spade. Please don't change because as a retail investor, I need to hear the unvarnished truth. I feel as an investor it's always important to seek the bull and the bear side for each investment in order to make the very best decision, no matter if the truth hurts.

"Would you respectfully share your thoughts briefly on Rexahn Pharmaceuticals(RNN)? It has received a lot of attention lately and has risen fast. Today [last Wednesday], the company issued a positive press release, and yet there was a considerable pullback. Of course, profit taking and selling on the news is to be expected after a 100% rise in a week or so. Perhaps, short- sellers saw an opportunity too? Thank you for the opportunity to contact you and look forward to hearing from you at your earliest convenience."

I had a lengthy and frustrating conversation with Rexahn CEO Chang Ahn Monday, during which I learned the following:

• Rexahn has yet to enroll a single patient in a phase II study of its experimental cancer drug Archexin in advanced kidney cancer. Rexahn announced the start of this Archexin study in May 2007! Since then, the number of patients enrolled equals zero -- as in zilch, nada.

  Ahn told me the study is "delayed." Really? You think?

• Ahn wanted to put me under a non-disclosure agreement before discussing data from the company's phase IIa study of experimental drug Serdaxin in patients with major depressive disorder. Rexahn issued a press release last October announcing positive results from this Serdaxin study, but the company has not yet provided any detailed data.

  For starters, I'm a journalist, which means my job is to disclose news, not hide it from my readers, so non-disclosure agreements don't work for me. I couldn't convince Ahn to discuss the Serdaxin depression data in full detail -- I'm still not sure why -- but he did tell me that the drug's efficacy was only demonstrated in a subset of the study's patients diagnosed with severe depression. (By how much exactly, he wouldn't say because the data are still under wraps for reasons he couldn't articulate.)

  Mild and moderately depressed patients enrolled in the study didn't benefit from Serdaxin, Ahn said. He also couldn't tell me how many patients were enrolled in the study, although he said the company's analysis was based on a "per protocol" pool of 80 patients. This means that some patients were excluded from the final analysis.

• Does Serdaxin have side effects? Heck if I know. When I asked Ahn to discuss the adverse events recorded in the phase II study, he insisted there was little or nothing to disclose. "Sometimes [Serdaxin] patients complain about a headache or something else but it's no different from the placebo group," he said.