Oral Sleep Apnea Therapy Poised to Expand Treatment Options

Right now, there is no pharmaceutical treatment for obstructive sleep apnea, a condition that is estimated to affect more than one billion people globally and approximately 30 million Americans. Multiple studies (notably in 2010¹ and 2017²) report that as many of half those prescribed continuous positive airway pressure (CPAP)—the gold standard apnea therapy—reject it outright, and between 12% and 25% of those who begin those treatments abandon CPAP within three years.

The reason for such high non-compliance is that CPAP is uncomfortable and socially awkward, Joel Latham, president and CEO, Incannex Healthcare, says. His company aims to be the first to potentially market an oral pharmaceutical therapy for obstructive sleep apnea.

Latham says Incannex Healthcare’s mission is “targeting indications that have limited or no treatment options available.” So, while a therapy for obstructive sleep apnea, known as IHL-42X, is its lead therapeutic, the company’s pipeline also includes therapeutics based on distinctly different therapeutic platform to treat generalized anxiety disorder and rheumatoid arthritis.

Oral apnea therapy

Regarding obstructive sleep apnea, “We are targeting multiple pathways, and [the condition’s] underlying, fundamental causes,” he tells GEN. Just as importantly, the therapeutic (code-named IHL-42X) is oral, which should significantly improve compliance and potentially make more people amenable to therapy. It has received Fast Track designation from the U.S. Food and Drug Administration (FDA).

The Phase II RePOSA trial showed that IHL-42X significantly reduced the frequency of breathing disruptions during sleep compared with placebo, with individual reductions of up to 83%. Reductions exceeding 30% were achieved by 33.3% of patients receiving the low dose and 41.2% receiving the high dose. A subsequent dose-optimization study, DReAMzz, began patient dosing in August 2026, supported by 14 clinical sites across the U.S. “We expect to have the data from that trial in the first half of 2027,” Latham says.

“IHL-42X is an oral, fixed-dose combination of acetazolamide and dronabinol,” he continues. “Acetazolamide [a carbonic anhydrase inhibitor used for altitude sickness and glaucoma] induces metabolic acidosis, which signals…there is excess CO₂ in the blood, and thereby causes people to take a breath. Dronabinol [a synthetic tetrahydrocannabinol used to control nausea and stimulate appetites] simultaneously dilates the airways. So, by inducing the taking of a breath and dilating the airways simultaneously, we’re able to reduce the number of apnea episodes that patients experience during the evening.”

Because this approach pairs two already-approved drugs, risks are reduced, the development pathway is streamlined, and costs are lowered.

Anxiety and arthritis

To treat generalized anxiety disorder, Incannex Healthcare is developing PSX-001, a psilocybin-based therapy designed to be used with cognitive behavioral therapy. The Phase II trials that completed in 2025 showed a 50% reduction in anxiety in 44% of patients.

Generalized anxiety disorder affects approximately three percent of the U.S. population. First-line treatments are selective serotonin reuptake inhibitors or serotonin-norepinephrine reuptake inhibitors, both administered with cognitive behavioral therapy.

“The current standard of care has an extremely high non-compliance rate,” Latham says. Medical literature cites non-compliance rates between 40% to 60% within six months. Given PSX-001’s apparent efficacy in Phase II studies, “This is a market where we firmly believe we can make significant impacts for patients suffering from debilitating anxiety disorders.”

Its third pipeline therapeutic—for rheumatoid arthritis—is on the back burner for now. “It’s been de-risked, but we truly have our hands full with the two lead assets,” Latham admits. IHL-675A, as this therapeutic is known, has completed “a plethora of preclinical and Phase I and II clinical studies, and the data’s been pleasing…but we’re focusing our resources on those [other] two assets.”

From Aus to the UAE

Incannex Healthcare has changed substantially since being founded in Australia in 2014. When it went public in 2016 on both the Australian Stock Exchange (ASX) and the NASDAQ, Latham—an early investor—joined the company as general manager. “After two years, I was elevated to CEO,” he says.

“Then, in 2023, we decided to delist from the ASX and purely focus on the NASDAQ because we firmly believe that’s where our true peers were. Shifting its ASX shares to the NASDAQ made it easier for U.S. brokers to trade Incannex Healthcare stock and for Incannex Healthcare to leverage U.S. investors’ knowledge around the cannabinoid and psychedelic sectors, as well as access more potential investors.

Recently, Incannex Healthcare moved its executive headquarters from Melbourne to Dubai, while retaining offices in Melbourne—“where the vast majority of our research team is located”—and New York. “Being in the UAE allows me to efficiently manage the two vastly different time zones that we deal with,” he says.

“Abu Dhabi,” he continues, “is quite a biotech hub. That’s one of the leading reasons for me moving here and setting up offices.” The United Arab Emirates is considered an emerging, fast-growing regional biopharma center with very fast regulatory approvals and a strong desire to enlarge its biopharma manufacturing base.

“We’re developing relationships, and we’re working with sovereign funds and with the government in relation to potential grants,” Latham says. That funding—an influx of nearly $60 million in the past year, which brought its cash balance to more than $74 million—provides “ample runway to see assets through to potential completion of Phase III,” he adds.

Maturity brings changes

Being president and CEO, he says “has been quite a unique experience,” given the multiple capital markets Incannex Healthcare has competed in, the multiple clinical assets it has developed, and clinical trials it has completed.

“Very early on,” Latham recalls, “we were entrenched in preclinical studies. We were able to move quickly, generating data, creating new assays and studies, filing provisional patents, and derisking assets.” Now the operational scale is much larger and, he points out, “We’re at a later stage of development, so things move slower.” Examples of current challenges include onboarding trial sites, ensuring adequate patient recruitment levels, maintaining productive FDA interactions, and managing the permits and licensing necessary to import trial products into the U.S. For Incannex Healthcare’s pipeline, that includes working with the Drug Enforcement Agency.

One thing has remained constant, however. From the very beginning, Latham says, “Everything’s been developed completely in-house in collaboration with our chief scientific officer, chief medical officer, and the expert leading advisory boards we’ve established for each of our assets.”

Next milestones

Completing the IHL-42X obstructive sleep apnea study, which dosed its first patient in August, is the company’s next milestone, Latham says. “We’re hyper-focused on getting those results out in 2027.”

Meanwhile, Incannex Healthcare continues developing PSX-001 to treat generalized anxiety. “Various potential collaboration discussions are underway as well, so we expect to be able to deliver a few key milestones and updates to the market in the coming months,” he says.

References

1. Catcheside, Peter G, Predictors of continuous positive airway pressure adherence. F1000 Medicine Reports. September 2010; 2:70 (doi:10.3410/M2-70)
2. Jacobsen AR, Eriksen F, Hansen RW, et al. Determinants for adherence to continuous positive airway pressure therapy in obstructive sleep apnea. PLOS ONE. 2017; 12(12): e0189614.

The post Oral Sleep Apnea Therapy Poised to Expand Treatment Options appeared first on GEN - Genetic Engineering and Biotechnology News.