Thread by @jeevanpatwa

#SuvenLife – Niche R&D play..very high risk and very high reward…key is right allocation…

Jazz Pharma was quoting around $0.5 in 2009, today its $150 and Mcap of $8.5 Bn on Nasdaq..almost 300x in 11 years. 80% of its total sales ($2.1 Bn) come from single drug Xyrem.

Axovant Lifescience, bought Alzheimer molecule from GSK, repackaged it and done phase-3 trials. Before starting the trials, the valuation was $2 Bn, just before announcing the data, it rose to $3 Bn. One of the leading broker put the target of $12 Bn if the trials succeeded..

but it failed in phase-3 trials. Current Mcap is $120 Mn…

This is R&D for New Chemical Entity (NCE)…very high risk and very high reward…

Brain-related illnesses, also known as CNS diseases, afflict more than 2 billion people worldwide. Diseases of the brain and mind range

from Alzheimer’s, dementia, epilepsy, migraine, multiple sclerosis, neuro infections, Parkinson’s, psychosis, schizophrenia and stroke to brain injuries and various mental disorders. The global market or CNS therapeutics is projected to reach $137.7 billion by 2025.

#SuvenLife has 1 lead molecule SUVN-G3031 in phase-2 trials which is similar to Xyrem but superior features, 3 molecules completed phase-1 trials and starting phase-2 trials and 11 molecules in pre-clinical trials. All are related to CNS which is growing and uncluttered market

1. SUVN – 502
SUVN-502 has recently failed in phase-2 trials where it couldn’t meet the primary end points related to Alzheimer’s but sub group studies has revealed some interesting statistically significant and
potentially beneficial effects of masupirdine on cognition,

function and behavior, which can be useful for further studies in Dementia and Neuro-psychiatry. Suven is planning phase-2 studies for the treatment
of behavioural and psychological symptoms of dementia (BPSD). Market size for this could be $2 Bn for USA.

2. SUVN-G3031 (phase-2 to be completed by Mar-21)
This molecule addresses a rare disease – Excessive Daytime Sleepiness (EDS) – in narcoleptic patients

3. SUVN-D4010 (phase-1 completed)
This molecule works for better cognition and as an anti-depressant

4. SUVN-911 (phase-1 completed)
It addresses the biggest limitations of current major depressive disorder (MDD) therapeutics with rapid onset of action, no sexual dysfunction, and enhancement in cognition

Some of the listed companies on NASDAQ working in CNS, (though not

strictly comparable) are Denali therapeutics ($7 Bn) and AC Immune ($340 Mn)

There are two possibilities ahead. Either it can partner with any big pharma company or list itself in USA. In the first case, it can get upfront payment with milestone payments defined.

In 2018, Lilly and AC Immune announced licensing deal for few molecules where AC immune received upfront payment of CHF80 Mn and up to approximately CHF1.7 Bn in other potential development, regulatory and commercial milestones, and low double-digit royalties with Lilly

#SuvenLife I tried to give balanced view explaining the risk and return of NCE game. Investing is all about understanding and managing risk well through allocation.