NeuroScientific Biopharmaceuticals Ltd

NSB’s Share Surged Over 189% Post Breakthrough Results Announcement: NeuroScientific Biopharmaceuticals Ltd (ASX: NSB) recently announced breakthrough results from the Spinal Cord Injury Model. EmtinB demonstrated the largest ever improvement in neurite growth and increased number of active connections between nerve cells. Treatment with EmtinB produced the longest axon ever sampled by this disease model. An increase in the length of the axon is a measure of nerve’s cell ability to regenerate.

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. Results clearly demonstrate the significant promise of Emtins’ neuroprotective effects in multiple neurodegenerative diseases, such as Alzheimer’s, Multiple Sclerosis, Parkinson’s, etc. First human studies are to be initiated this quarter.

In its investor presentation report, NSB highlighted that around 48 Mn people globally have dementia and 70% of dementias have been identified as Alzheimer’s disease. This is expected to put US$818 Bn global economic burden. Under optic nerve conditions, 5% of the population suffer vision loss due to the damaged optic nerve. Around 60 Mn people are affected by glaucoma. During 2018 alone, Eli Lilly, AstraZeneca, Johnson & Johnson, Merck, and Eisia / Biogen all halted clinical trials. 20-years of research and BILLIONS of $ focused on beta-amyloid plaques has not translated to any effective treatment. NSB is the only company in the world actively pursuing the alternative approach of combating Alzheimer’s through active neuroprotection mechanisms via the LRP-1 receptor.

March’19 Quarter Key Highlights: The net cash outflow from operating activities for the quarter period was reported at $0.24 Mn. The net cash from financing activities for the quarter was reported at $0.25 Mn. The net cash and cash equivalents for the quarter period was reported at $5.09 Mn.

 
March’19 Quarter Operating Cash Flow Statement (Source: Company Reports)

H1FY19 Financial Performance:Revenue (including interest received) for the period was reported at $32,626. Loss for the year attributable to the owners of NeuroScientific Biopharmaceuticals Limited increased by 159% to $841,778. This can be majorly attributed to Administration expenses, Research and development expenses, Employee benefits expense and IPO costs.


H1FY19 P&L Statement (Source: Company Reports)

What to expect: As per the report, all study programs involving lead drug candidate EmtinB are on track and the company is set to report on a number of important outcomes in the coming months. An imaging biomarker that demonstrates efficacy is being developed. Moreover, Safety and toxicity program to support Phase I clinical study is progressing as expected.

NSB will attend BIO 2019 Annual Conference in Philadelphia in June to progress initial partnering and co-development opportunities.It is also expected to be present at the 121 Technology Investment Conference in Hong Kong where it will get an opportunity to showcase its product and aware the world about its effects.

Stock Recommendation: NeuroScientific’s share generated positive YTD return of 11.54% as on June 28, 2019. Its current ratio for H1FY19 stood at 189.35x, which is better than the industry median of 4.55x, which implies the company is in a better position to address its short-term obligations. Moreover, on 2 July 2019, the company’s share rose over 189% on the release of positive breakthrough results from Spinal Cord Injury Model. This development is expected to encourage the company to increase awareness of the product around the globe, which will lead to improvement in margins. However, such a huge rise in the share price increase the probability of correction sooner or later. Hence, considering the aforesaid facts and current trading level, we suggest investors to watch the stock at the current market price of $0.420 per share (up 189.655% on July 2, 2019) and wait for better entry levels.

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