Today the CEO and President of RXi Pharmaceuticals (RXII) announced additional results from the phase 2a trial using RXI-109 against hypertrophic scars. The previous article we wrote discussed the early 1-month results of RXI-109 against hypertrophic scars in phase 2a. As we stated in this previous article, one month is too short of a time span to tell whether or not RXI-109 achieved clinical efficacy or not. Regardless of this the cohort 2 results for RXI-109 were better than placebo even at the 1-month time point. Today's results show how the RXI-109 drug worked on hypertrophic scars at a 3-month time point shown by slides 15 and 16 shown here "Rxi BioForum Presentation slides"

We also mentioned before that if the 1-month photos looked good, then the 3-month photos would look even better and we were right. This is because hypertrophic scars take 3 to 6 months to grow back fully, therefore causing an irrational panic sell-off on the 1-month results because investors didn't understand the clinical data. Today's pictures, shown  in the RXi Presentation slides above, have now validated the sd-rxRNA platform. This means now we know RNAi -- RNA interference -- can now be used to turn off specific genes of a particular disease. With today's news the share price of RXi Pharmaceuticals should eventually gap up to a higher market cap of at least $500 million, close to its other peers in the RNAi industry like Tekmira Pharmaceuticals (TKMR) and Arrowhead Research Corp (ARWR).

This validation is important because now the company is at a reduced risk investment level since we now know that RXI-109 works in humans three months post surgery compared to a placebo compound. Getting this drug to market would be a huge step in helping the company move itself forward, as it could stand to make $1 billion to $1.5 billion dollars in the U.S. alone. Also this should help RXi  to obtain a partnership easily now as it has proven its technology to work in humans in a mid-stage trial. The company though is not a one trick pony because it is advancing its ophthalmology pipeline as well and is expected to file an IND for RXI-109 in eye diseases in the coming months. In other words RXi is just getting started with its RNAi technology and should continue to do well in the coming years.

Going forward though, there are plenty of catalysts that should be expected from RXi. Some of them include the addition of another midstage clinical trial to the pipeline. This is listed at the end of the slides but as of now it is not clear what the company will be adding to the pipeline. The company says it expects to report about this addition of the mid stage phase 2 trial by the end of 2014, as mentioned by the CEO in the presentation. Other catalysts should come at the beginning of 2015 when the company expects to report clinical trials on its other early stage programs like macular degeneration -- vision loss in older adults-- and Retinoblastoma -- eye cancer in children under 15. We think that investors now have a golden opportunity to enter a biotechnology stock that holds a promising future and has completely de-risked itself with these great phase 2a results.