Incannex Healthcare Inc. (Nasdaq: IXHL) shares surged after the company announced highly encouraging topline results from its RePOSA Phase 2 clinical trial of IHL-42X, an oral drug candidate for obstructive sleep apnea (OSA). Affecting over 900 million people globally and with no currently approved oral pharmaceutical therapies, OSA represents a major unmet medical need. The robust efficacy and excellent safety profile demonstrated by IHL-42X positions it as a potentially transformative treatment for patients suffering from this widespread and often underdiagnosed condition.

The Phase 2 trial revealed statistically significant and clinically meaningful improvements across multiple primary and secondary endpoints when compared to placebo. Patients receiving IHL-42X, in both low- and high-dose groups, experienced significant reductions in the Apnea-Hypopnea Index (AHI), which is the primary measure of OSA severity. Maximum reductions in AHI reached up to 83% in the high-dose group and 79% in the low-dose group. A notable percentage of patients achieved more than a 30% reduction in AHI—33.3% in the low-dose group and 41.2% in the high-dose group—while 13.9% and 14.7%, respectively, saw reductions of more than 50%, highlighting the drug's strong therapeutic effect in a substantial portion of the population.

The trial also showed statistically significant improvement in sleep-related impairment and fatigue, as measured by the Patient Global Impression of Change (PGI-C), particularly in the low-dose group. These findings suggest meaningful benefits in daytime alertness and overall sleep quality. Both dosing arms demonstrated improved oxygenation during sleep as reflected in statistically significant changes in the Oxygen Desaturation Index (ODI). Patient-reported outcome measures, including the Functional Outcomes of Sleep Questionnaire (FOSQ-10), PROMIS Sleep-Related Impairment and Fatigue scores, and the Epworth Sleepiness Scale (ESS), all reflected improvements in sleep quality, daytime functioning, and fatigue levels.

Objective sleep parameters, measured via polysomnography, further supported IHL-42X’s efficacy. In the high-dose group, Wake After Sleep Onset (WASO) was reduced by 29.8%, meaning patients spent less time awake during the night. AHI during supine sleep, a period when apneic events tend to worsen, decreased by 30.3% in the high-dose arm. These improvements demonstrate the drug’s ability to meaningfully address both subjective symptoms and objective physiological dysfunctions associated with OSA.

In addition to its compelling efficacy, IHL-42X was well tolerated across both dose groups. No serious adverse events were reported, and treatment-emergent adverse effects were infrequent and primarily mild to moderate in severity. This outstanding safety profile strengthens the case for IHL-42X’s potential as a broadly accessible therapy for OSA patients.

Joel Latham, CEO and President of Incannex, commented: "We are extremely pleased with the RePOSA trial results. The combination of statistically significant improvements across multiple endpoints and an outstanding safety profile positions IHL-42X as one of the most compelling drug candidates in the global race to bring a pharmaceutical treatment for OSA to market. The depth of response seen in a defined subset of patients further reinforces our belief in its clinical and commercial potential. These results are a clear signal of the strength of our development strategy and a critical step forward in building long-term shareholder value. We continue to facilitate commercial discussions and look forward to providing shareholders with an update in this regard soon."

Following the successful Phase 2 study, Incannex is preparing for an End-of-Phase 2 meeting with the U.S. Food and Drug Administration. This engagement will focus on defining the optimal regulatory pathway and refining the design for Phase 3 trials. In parallel, the company is finalizing the full Clinical Study Report and continuing commercial discussions as it moves toward late-stage development and potential future approval.

The RePOSA Phase 2 trial was a randomized, double-blind, placebo-controlled study involving 121 adult participants with confirmed moderate to severe OSA. Patients received either a high dose, low dose, or placebo version of IHL-42X for a 28-day treatment period. The trial followed FDA guidelines and assessed both objective sleep metrics and patient-reported outcomes to evaluate efficacy and tolerability comprehensively.