It beggars belief that Neuren would sign off on an agreement...

It beggars belief that Neuren would sign off on an agreement which is tantamount to commercial suicide if they have no agency over what they can do. Undoubtedly I'm not an expert on contracts, but it seems to me that some folks picture Neuren as the minnow where I see them as equal.

Firstly, it needs to be kept in mind that the agreement signed last year is a replacement for the original 2018 agreement. It is not commercial suicide – it is actually an improvement on the more onerous conditions of the 2018 contract, signed when Neuren was indeed a minnow compared with Acadia.

In this new JV and Licence Agreement Neuren has succeeded in getting Acadia to agree to remove potential restrictions on the development of NNZ-2591 in the four indications of PMS, PHS, AS and PWS. That has enormous value and could only be negotiated from a position of increased strength.

The JSC was designed to ensure one party does not outmanoeuvre another, the agreement was negotiated in good faith, Jon and Neuren don't seem particularly worried about how events are unfolding so far yet shareholders here appear to be splitting hairs over legalese (and I say this with all due respect to fellow posters).

Despite all the best intentions and good faith in the world, if and when the proverbial hits the fan, it all comes back to the wording of the contract. Think insurance companies and claims. If Neuren is happy to be absorbed by Acadia, it’s no big deal. But if another pharma has genuine interest in acquiring Neuren, the potential threat to future development that is evident in the “legalese” matters enormously. Platitudes about “good faith’ will count for nothing; the actual wording of the contract will.

Neuren is conducting preclinical studies in undisclosed indications for competitive reasons. Are they competing with Acadia? Have they had discussions with Acadia about said undisclosed indications already and Acadia have given an assurance they will not impede Neuren's progress?

I don’t know. Irrespective, Neuren is still entitled to develop these indications for ROW and thus, these new indications add value to Neuren.

It would be beyond bizarre if Neuren did these studies and all of a sudden Acadia says no. Would Neuren pigeonhole themselves like this and put themselves under the boot of Acadia? I really hope that's not the case and I don't think Neuren is that foolish.

IMO I think there's an understanding between the companies we are not privy to, of which I think the PR voucher has some part to play.

Bizarre or not, fair or not, probable or not, palatable or not, the wording of the contract says that it is possible. And no, Neuren hasn’t newly “pigeonholed” itself – that already happened in 2018 when Neuren was the minnow and options were lacking. Neuren has actually freed itself of some of the original restraints.

As for any “understanding” between the two companies, again, that’s fine if part of that understanding is that Neuren will be acquired by Acadia. But it cannot be expected that other pharmas will be willing to pay for unrestricted development and commercialisation rights for future NNZ-2591 indications based only on “understandings”.

What is Acadia waiting for?

The same as everyone else, I suspect. Phase 2 Angelman results and the outcomes of the EOP2 meeting with the FDA. That meeting has significant implications for future direction and value.

By the way, this restriction on Neuren is nothing new. It was spelt out by Jon last July in the “Value of NNZ-2591 enhanced” slide of the presentation following the new JV and Licence Agreement and was discussed at length here.




In conclusion, my key point is that, although it’s likely that there will be multiple pharma interested in acquiring Neuren given recent successful Phase 2 results, Neuren/Acadia contract restrictions mean that the full value of NNZ-2591 is realisable only to Acadia, and that will inevitably be reflected in any acquisition deal.