Pipeline-in-a-drug, page-11

Thanks for your insightful response TB.

For my part, I don't necessarily agree that the present share price dictates takeover price or timing. The share price is determined by the aggregate supply and demand for the stock at a given time. As others have suggested, I think it's likely that some profit-taking occurred after the Pitt Hopkins readout by those exiting before the Angelman results and longer-term developments. Regardless of the cause, the effect of that selling was to lower the share price.

On the other hand, a competitive takeover price is determined by the willingness to pay of the suitor(s) and the willingness to sell of the target. Given NNZ-2591's potential, as proved up by two positive Phase 2 trial results and preclinical studies in other indications, I do not think suitors will feel constrained by the present share price. They will simply express a willingness to pay which reflects some discount on their expected return from Daybue and NNZ-2591. If there is more than one potential suitor, things get more interesting in an auction-style bidding process.

That still leaves open the question of whether Neuren should court takeover interest now or expend some of its war chest getting NNZ-2591 FDA approval-ready first. Jon/management have not given an explicit indication of their preference, but my sense (speculation only) is that they are hoping to put a bow on the company this year.

Keen to hear what others think.