Hello new and potential investors, as well as existing investors. I have updated & re-hashed a post I did 6 months ago to make it easier for new and potential investors to get up to speed. Jenqui! Needed to post again because the formatting scrambled upon posting!
Background.
NeuroScientific Biopharmaceuticals (NSB) was listed on the ASX in July 2018. The company was founded by venture capitalist Harold Clough via his family-owned investment vehicle ‘McRae investments’. Harold Clough is most famous for Clough Engineering and its sale to big South African engineering company Murray & Roberts. He was interested in finding the cure to Alzheimer’s disease which is probably why he acquired the IP before he took the company public. The Emtin peptide technology is central to NSBs work and was originally developed by scientists based at the University of Copenhagen’s Institute of Neuroscience and Pharmacology. At this stage, the precursor to EmtinB (one of the Emtin peptides) was injected into 8 rats that had had their optic nerve severed, in ALL 8 cases the drug regenerated the neurons in the optic nerve / completely regenerated the optic nerve. That’s right, it reversed blindness - a 1st in science. The University of Tasmania (UTAS), subsequently acquired the intellectual property from the University of Copenhagen. NSB has an exclusive license agreement with UTAS to develop and commercialise the intellectual property related to EmtinB (which is a mix of cash and shares). The Emtin intellectual property includes patents granted in the USA and European markets, research data, reports, and know-how.Ex-Chairman Brian Leedman believed that NSB’s treatment for Alzheimer’s could be a ‘potential cure’ in a place where all other drugs have failed for efficacy. He is also on record saying that if the company were to complete Phase 1 safety trials, establish safety and show that EmtinB can regenerate neurons / slow down progression of Alzheimer’s, a licensing deal with Big Pharma could (probably) be struck, as Big Pharma need something ‘novel’ and ‘new’ due to failures of other approaches to try and treat Alzheimer’s. NSBs approach with EmtinB is COMPLETELY novel (and different) compared to other companies approaches in treating Alzheimer’s. To reiterate, Ex-chairman Brian Leedman was of the view that Big Pharma would just want to see that the drug is safe before an agreement could be made. This is interesting as the company has on numerous occasions said that they are fully funded through to the completion of Phase 1 trials, which could potentially tie in to Leadman’s comments.Alzheimer’s is not the only string to NSBs bow however, EmtinB is being looked at to treat several conditions, with their current clinical stage listed below:
As mentioned above, NSB is funded at least through to completion of Phase 1 clinical trials in humans (also regarding cash note that NSB will be able to receive R&D Tax Incentive rebates on up to $25 million of R&D expenditure incurred during 2021, 2022 and 2023). Below is approx. MC vs SP and Enterprise Value.
Current Market cap is 65m with the share price sitting at 45c at time of writing.
EmtinB, Peptides, Safety & Toxicity.
The Emtin peptides are synthetic peptides modelled on the domains of a naturally occurring protein, called Metallothionein-II (MTII). This is great because there is already lots of literature about MTII and what it can treat. Extensive studies have shown that MTII is a neuroprotective protein that is expressed within the central nervous system (CNS) in response to brain injury. Studies have shown that EmtinB is safe and well tolerated at HIGH concentrations, and the company has said that there is very low risks of side effects because it is based on something that is already occurring in the human body. One of the remarkable things about the drug is that it passes the blood brain barrier, this means that it allows infiltration of Central Nervous System and brain (where as other drugs have not been able to achieve this, and hence can’t treat these conditions). Due to its regenerative properties, I believe this drug to be more on the cure end of the spectrum between cure and treatment.In the investor webinar by Dougal Thring it was best explained how EmtinB works:
”when the body encounters an injury, we already have these specific immune proteins which come to the rescue that repair and regenerate that injury... it is very effective but the body can only make so much of it. So what we have done is isolate the most active site on that protein, and we have a synthetic smaller section of that ... called a peptide. The advantage of making this synthetically is the increase in stability and potency, and there are also very low risks of side effects because it is based on something already occurring in the human body".
From this, you can assert that to some degree, this peptide/protein already works in the human body as it is a part of our immune system. For whatever reason, the body can only produce a finite supply. To me it seems more absurd that this worked in animal models, as it was designed off something occurring in the human body. This is further backed up by a number of safety studies that have been completed with no adverse effects in regards to toxicity. For example: on 28/01/2021, it was reported that at approximately three times that of the planned maximum clinical dose had not resulted in any ocular safety issues (ophthalmology arm). On 20/05/2020 it was reported that for Neurodegenerative conditions no toxicity in dose levels 60x higher than planned clinical dose were observed (neurology arm). Safety studies of non-human primates have also not had any toxicity or safety issues where 3x the planned clinical dose was administered.So why haven’t competitors done this before us? MTII hadn’t been able to be manufactured synthetically with consistency, until EmtinB came along (not that we haven’t had trouble with manufacturing, this will be talked about later). Regarding conditions of the optic nerve, EmtinB will be a candidate as a long-term treatment as pre-clinical tests have shown that it lasts long in the eye, as EmtinB significantly exceeded the target end point for minimum duration in two pre-clinical ocular studies. Regarding application, so far testing has only been done via injections, but an eye drop formulation will be developed and tested.
Directors.
*• Paul Rennie – current Chairman brought over from PAR, also has executive experience with MSB. Significant experience dealing with the FDA and drug regulators and in clinical development. During Rennie’s tenure as Chief Executive Officer at PAR the company has grown in market capitalisation from circa $30m at IPO in 2015 to current $413m valuation • Brian Leedman - former chairman: Co-founder of RAP and IMU
• Dr Anton Uvarov, Executive Director: Founding director of ACW, another ASX listed Alzheimer’s company. Pre-IPO, Dr Anton told Brian Leedman that EmtinB is the greatest drug he has ever seen. Remember this, it is important for later. Brian Leedman subsequently verified that if this drug does what they think it can do it will be the greatest drug in the history of science (in his opinion). Anton was a former director at IMU (where Leedman also worked)
• Matt Liddlelow, MD + CEO: 15 years’ experience commercialising medical devices and pharmaceuticals for multi-national companies including AstraZeneca – that huge company behind the COVID vaccine. Leedman mentioned Matt is linked to McCrae investments somehow too, but I am not sure how
• Stephen Quantrill, Non-Executive Director: Chairman of McRae investments and the Clough families inside man
Abby Macnish (Company Secretary & CFO) is also the CFO for McCrae investments, to further illustrate how close the top shareholder is to the actionDirectors interest from the annual report below:
Key Holders.
McRae Investments and Technology (two separate holdings) – the investment vehicles of the Clough family. Switzerland-based Alpha Swiss Partners took a position at $0.28 per share, Alpha Swiss is a well-respected family office with circa $1.8 Billion USD under management. I can’t verify this 8.5m to the latest T20 so I am wondering if they are “BNP PARIBAS NOMINEES PTY LTD SIX SIS LTD” and have been buying more on the market? If anyone else knows what has happened here, please share. T20 below:
Markets – Alzheimer’s, MS, Glaucoma, Post COVID Fibrosis, and more.
*Alzheimer’s:
US$818b (read that number 3 times to fully comprehend it) global economic burden. Work in vitro shows that EmtinB is able to restore neurons in damaged cells in different areas of the brain. EmtinB increased neural survival by 90% across all studies and it increased cell regeneration by over 300% in all studies. R&D for OTHER treatments to date has categorically failed to deliver and Big Pharma have spurned millions on their failures. Although recently Biogen was able to obtain FDA approval for their drug to treat Alzheimer’s... Look at the end of the investor webinar when Dougal Thring is asked about EmtinB compared to the Biogen drug, he seems to smile before saying that EmtinB is a lot better from disease modifying potential (it affects the underlying pathology of the disease) … The Biogen drug is an anti-inflammatory, and EmtinB could regenerate damaged cells within cognitive impairment – there is a
HUGE difference! None of the current medications today can restore the damage to the neurons themselves, EmtinB will undergo testing in humans to prove that it can
*Glaucoma: 5% of population suffer vision loss due to a damaged optic nerve. 60m people affected by glaucoma, US $3b sales p.a. NSB and the Lions Eye Institute (LEI) have entered into a research agreement to develop EmtinB as a treatment for eye diseases that affect the optic nerve. LEI is one of Australia’s leading ophthalmic research institutes and is globally recognised as a centre for first-class scientific research into eye diseases. Currently there are no drugs to restore the optic nerve once it becomes damaged. EmtinB demonstrated significant neuroprotection in pigs with Glaucoma (who have the most similar pathology to that of humans) indicating the disease modifying potential of EmtinB. The advantage of a Glaucoma study is in a phase 1 clinical trial you can treat patients who have Glaucoma – it’s not just a safety and toxicity study.
*MS - Multiple sclerosis: EmtinB stimulated nerve regeneration exceeding 300% compared to control and double that of Copaxon, the leading marketed drug for Multiple Sclerosis with peak annual sales of $4 billion dollars. Results clearly demonstrate significant promise of Emtin’s neuroprotective effects in multiple neurodegenerative diseases, such as Alzheimer’s, Multiple Sclerosis, Parkinson’s, etc. Global sales for MS drugs in 2020 was US$22 billion with 2.3 million patients suffering from this disease globally.
*Post COVID Fibrosis/Pulmonary Fibrosis: Don’t have any stats for TAM of this market, but as we all know, the effects of COVID are huge and wide ranging. Treatment with EmtinB significantly reduced biomarkers associated with severe COVID-19 in vitro. Study results indicate EmtinB therapeutic potential in preventing severe immune responses from COVID-19 infections. Treatment was safe and well tolerated across all dose concentrations - suggesting it is safe to administer in future work.
*More: The company has been silent on Optic nerve atrophy for quite some time, I expect this to change soon. MTII may also be a good treatment for other diseases, the company could surprise us at any time with new research programs.
Delays.*Phase 1 clinical studies initially scheduled for Q2 2019, is now expected to begin late Q4 2021 after timelines have been pushed out time and time again. The company has cited
• Manufacturing issues (as the peptide needs to be of a high degree of purity). The manufacturing is very complex but NSB has managed to overcome these difficulties with separate manufacturers Bachem AG and Mitsubishi / Peptistar, having more than one manufacturer gives NSB cover if there is a delay in one
• NSB have had to run multiple models (which was more than expected) rather than single models for Big Pharma and Regulators
• Difficulty obtaining non-human primates for safety studies.
The company has made several appointments this year to suggest that any delays from here on in should not be material
• Director of Operations - Dr Alexandra Heaton (PhD in Neuroscience), previously worked with Linear Clinical Research who will be doing our Ph1 trials surprise• President of Clinical Development - Dougal Thring (Masters of Pharmaceutical Medicine), also previously worked at Linear… Sensing a trend?
• Highly experienced clinical ophthalmologist Dr Peter Hink - appointed to Scientific Advisory Board ahead of planned Glaucoma clinical study in patients
• Globally recognised toxicologist Dr Frank Bonner - also appointed to Scientific Advisory Board, to enhance R&D capabilities and provide guidance on pivotal safety studies.
High-level comparisons.*• ACW: Market cap of 166m, in Ph2 for Alzheimer’s and another niche condition. Remember Dr Anton Uvarov was a founding director and is instead plying his trade at NSB with ‘the greatest drug’ he has ever seen. Speaks volumes of where this could go
• NEU: Market cap of 260m, in several Ph2 and Ph3 results coming soon. NSB would have a much higher TAM (I don’t know the exact figure of a TAM for NEU – but they are targeting more niche conditions). NSB should be entering multiple Ph2 studies next year.
Personally, I believe IMU (2.5b Market Cap) is a more fair comparison that would do the caliber of the NSB product portfolio any justice, but I will leave you to draw your own conclusions on that. I expect that should everything go to plan we will be testing the Market Caps of ACW and NEU in the not-to-distant future.
Current Outlook.With the completion of preclinical safety studies the Company can conduct pre-IND meetings with the FDA before starting clinical studies, but not necessarily submit an IND before Phase I studies. Due to the novel structure and function of EmtinB, it is necessary that they interact with the FDA before they complete the safety and tox program so that they can understand their expectations for the data required to gain approval in the future.Trials runway:
• Final pre-clinical studies finalised early to mid Q4
• Neurology Ph1 clinical trial to begin late Q4. This safety study will be all encompassing and used for Alzheimer's, MS, and I hope Pulmonary Fibrosis too• Glaucoma Ph1 trial straight into Glaucoma Patients Q1 2022
• Next year Ph2 studies in Alzheimer's (Q4 2022), Multiple Sclerosis (unknown commencement date), and Pulmonary Fibrosis (unknown commencement date),
• Next year Ph2 into Glaucoma patients Q4 2022
Clinical trials will be done by Linear Research and will be able to be viewed here once registered:
• https://www.linear.org.au/trials/
• clinicaltrials.gov
Parting Notes• Director of Operations, Alexandra Heaton (PHD in Neuroscience) has said “we are confident it is going to be able to be reproduced in Humans”
• The company has been dropping “Big Pharma” in announcements frequently, let’s hope they are giving us clues as to something exciting being close to being disclosed. At the BIO Digital 2021 conference they participated in more than 20 high-level partnering discussions.
• Wouldn’t be surprised if the company decides to dual list on an overseas exchange e.g. the NASDAQ, where Bio-tech companies can get significantly higher valuations and greater access to capital (compared to the boring old ASX that is obsessed with digging up rocks from the ground and banks) within the next couple of years – many of our ASX peers have done this already to great effect
• Further delays are my current biggest concern, but I speculate that any further delays will not be material• The best piece of content out there from the company is
this investor webinar• All IMO and DYOR
• Would be great if the other regulars on this thread could share some of their insights to this company that supports their conviction
