The Whens and Whys of Top Biotech M&A Deals, page-42

Jon is, rightfully so, placing an emphasis on moving into P3 for PMS and PH and the associated value uplift - it is his and the board's fiduciary duty to do so as they cannot assume a t/o will happen.

As others above have discussed, I believe this is the simple reason for the recent SP weakness. What we have is a group of institutional and other investors who do not have the performance time horizon for P3 trials so are reducing their exposure. Many other theories for the recent weakness have been thrown around, but what I have learnt over the years is that, despite the facade of sophistication, Occam's Razor usually operates in investment markets.

Now, many of these investors may be assuming a time horizon of 3+ years for P3 trials and that a t/o will not happen until then. However, I believe Jon still has the possibility of corporate action firmly in his mind post the meeting with the FDA next month. He has stressed the importance of this meeting beyond its prima facie purpose several times - and did so again yesterday at the biotech showcase in Melbourne - and some of his language has been interesting.

For example, during the Angelman webinar in response to a question around the future strategy for 2591 - time stamp 24:00 "the FDA meeting is very important. Until we know exactly what the P3 trial will look like we and others are not going to be able to make firm decisions around that."

Similarly, in response to a question about discussions with pharma - time stamp 46:50 "had a number of discussions and will continue to have discussions but we need to get through that meeting in September before we'll say anything more concrete than that".

Essentially, any acquirer is going to want to know what they are buying and how to value it - and that means understanding the dimensions of the P3 trials.

Then there is the pre-clinical work on the undisclosed indications. I have posted before I believe the purpose of this is squarely to maximise the value of the 2591 asset. Neuren will have their hands full running 2 P3 trials, I just can't see them initiating additional P2 trials at the same time.

So, I believe this company is still being set up for acquisition possibly before or during P3 but with a firm and achievable plan should this not occur.