Ignoring the possibility or a T/O, I think a potential reason...

Ignoring the possibility or a T/O, I think a potential reason for the SP decline is simply the lack near-term positive catalysts which means there are potentially better returns to be achieved elsewhere, at least in the medium-term.

There will be minor milestones along the way but the most significant catalyst on the horizon will be FDA approval following Phase 3 trials. I estimate that could be mid-2027. That is a very high-level approximation and I know there are HC contributors with significantly more knowledge than myself so I welcome their input on the process the timeline of events.

I arrived at that estimated date using the following assumptions:

- Meeting with FDA next month to discuss and agree Phase 3 parameters (Q3-2024)

- One quarter of planning and preparation(Q4-2024)

- Phase 3 trial beings Q1-2025 and takes 2 years (Jon referenced 2 years in the recent investor webinar) so covers Q1-2025 to Q4-2026 inclusive

- Two quarters of post-trial analysis, evaluation, and refinement of trial data and results (Q1 & Q2 2026)

- One quarter of FDA fluffing about with their evaluation and approval process

That timeline won’t be correct – it is just a guesstimate - but it serves as an indicator to highlight the passage of time during which there may be no significant SP catalysts. It could be 3 years, it may only be 2 years, but in the absence of a T/O there may not be any major SP catalysts for quite some time. I expect this could be a factor in Instos wanting to reduce their NEU holdings and reallocate capital to other opportunities.

With regards to Instos, it has been noted (by Little T) they own close to 50%. If they want to reduce their holdings the volume of shares to be sold will far outnumber the buy-side and hence the SP will decrease, which is essentially what we have observed.

I have a few thoughts on the probability and timing of a T/O which I’ll share in another post, but for now I’m keen to better understand the likely timing of the Phase 3 trials and associated processes and welcome the input of those with more knowledge on the details.