Ann: Investor Presentation, 14 March 2023, page-58

Hi sillazze

Thank you, that's very, very interesting!

I totally agree with you that there’s something clearly different/special about the program for NNZ-2591 in Prader-Willi. While the other 3 indications for NNZ 2591 were revealed in H1 2019, Prader-Willi was only announced as a surprise addition to the pipeline in February 2021. Unlike other Neuren patent applications, the Prader-Willi wasn’t first filed in Australia; it was first filed as an International Patent Application in February 2021. Also, there have been unexplained delays in the Prader-Willi program, first in filing the IND for the Phase 2 trial and now in commencing it.

I was already aware of Levo Therapeutics’ Phase 3 trial and ultimate rejection in February 2022 by the FDA of its carbetocin therapy for Prader-Willi and posted about it (here and here). Carbetocin, like trofinetide, is a synthetic peptide analogue of a naturally occurring hormone, but a different hormone and different route of administration.

What I certainly wasn’t aware of was Acadia’s acquisition of Levo Therapeutics in June 2022.

Why? Well I never saw mention of it on Acadia’s website or in any of its SEC filings, presentations or earnings calls. Which reminds me of Acadia’s undisclosed Phase 2/3 trial of pimavanserin in irritability associated with autism.

I’ve now looked into Levo further and this is what I’ve found.

Levo Therapeutics was founded in 2016 and its sole asset, intranasal carbetocin, was a Phase 3-ready asset licensed exclusively from the Swiss Ferring Pharmaceuticals, which had already received FDA orphan drug designation for the drug in 2014.

Levo Therapeutics was founded with private funding from Samsara BioCapital. In November 2019 (a month after the trofinetide pivotal trial commenced), a Series B financing round was completed and this time Samsara was joined by “an undisclosed healthcare investment fund”. While the identity of that fund was never revealed the fact that a principal and a Partner from Baker Brothers received Board seats makes it obvious that Baker Brothers had bought a substantial stake in this tiny biotech. Which is a bit unusual, because the Baker Brothers Advisers Fund normally invests in listed companies. As a reminder, the Baker Brothers Advisers healthcare private hedge fund is big, with US$26 bn in investments under management early this month, prior to its windfall from Pfizer’s acquisition of Seagen.

After Levo received its CRL from the FDA in January 2022, the biotech was quietly acquired by Acadia in early June 2022. As we know, the Baker Brothers are also the major shareholders of Acadia and sit on its Board.

It is unclear whether Acadia intends to further develop the carbetocin asset. Perhaps the real value in the Levo acquisition lies in the knowhow and relationships etc. formed during the development of carbetocin in Prader-Willi, which should stand Acadia in good stead should it ever develop another Prader-Willi asset.

So, yes, Sillazze, I agree with you that there is definitely something significant, and linked, in Neuren’s Prader-Willi program and Acadia’s acquisition of Levo Therapeutics.

However, I disagree with you on two other points.

Firstly, I don’t believe that Acadia has been interested in Prader-Willi since 2014 as suggested by Acadia’s name on the FDA Orphan Drug designation. Ferring Pharmaceuticals originally received this grant, that was transferred to Levo in 2016 and finally to Acadia in June 2022. What I’d observe instead is that the Baker Brothers have shown an interest in Prader-Will since late 2019.

The other point on which I disagree is that the PRV received for DAYBUE is destined to speed up Prader-Willi time to market. As pointed out by LostOut, NNZ-2591 in Prader-Willi will have Priority Review in its own right, as will the other 3 indications. Furthermore, Priority Review only shaves ~ 4months off regulatory review, so PRVs are typically used for very high value market drugs that are in a neck-and-neck race to market.

Autism, Prader-Willi …. I wonder how many other cards the Baker Brothers-controlled Acadia are playing close to their chest.