Saturday, June 15, 2024

Undervalued Israeli Biotech : NurExone Biologic Inc (TSXV: NRX)


 NurExone Biologic Inc’s (TSXV: NRX) (FSE: J90) (NRX.V) (the “Company” or “NurExone”) mission is to pioneer the development of novel, biological, and minimally invasive treatment for Spinal Cord and Traumatic Brain Injuries.

Why NRX?

Shares appear to be priced significantly below absolute and comparative metrics. While our CAD$4.00 price target is based on discounted future earnings, a comparable analysis looking at biopharma companies co-developing specialized treatment platforms and treatments suggests the share price at the time of breakeven would be >CAD$2.50.” (Litchfield Hills)

The global Spinal Cord Trauma Treatment market was valued at US$ 2458.9 million in 2022 and is projected to reach US$ 3009.4 million by 2029, at a CAGR of 2.9% during the forecast period. The influence of COVID-19 and the Russia-Ukraine War were considered while estimating market sizes. 

Let’s get into some research stats courtesy of Litchfield Hills Research.

Current NRX Market CDN0.32 against Litchfield’s price target CDN4.00 per share.

Litchfield Research Rationale

• NRX met 2Q23 expectations. 2Q23 was in line with our estimate of a $0.02 EPS


• Closed on financing. On Sept 6, it closed a private placement, raising CAD$1,483,500.70.

•. On Sept 13, the Company has completed a pre–

Investigational New Drug (Pre-IND) meeting with the U.S. FDA. The Company plans to submit an IND application regarding the development of ExoPTEN by Q4 2024.

• Wins Eureka grant. On Oct 11, it announced that the Company had been awarded a 

 (CAD$350K) grant by the Israel Innovation Authority (IIA) as part of the Eureka program.

On Oct 19, it announced it had added Professor Teodoro Forcht Dagi,

a renowned neurosurgeon, life science venture capitalist, and professor at the Mayo Clinic Alix School of

Medicine and Queen’s University Belfast are to its advisory board and advisory committee.

• Receives FDA Orphan Drug Designation. On Oct 30, the company announced that the FDA had granted

Orphan-Drug Designation (ODD) for its ExoPTEN therapy.

Why NurExone?

Innovation, Key Medical advancements and a vast waiting market.

Simply, without pharma-speak, NRX is a pharmaceutical company developing a platform for biologically-guided ExoTherapy to be delivered, non-invasively, to patients who have suffered traumatic spinal cord injuries.

Stay with me; it will be worth it.

NRX’s treatment for spinal cord injuries graphically;

Exosomes (therapy) are really cool little nanovessels that specific cells need to go into the body to effect relief or cure. Sort of like stem cells, but potentially better.

ExoTherapy (delivery system) Controlled and efficient large-scale production of quality exosomesHigh-yield loading of therapeutic cargo onto exosomes, with cargo formulations targeted to different mechanisms of action for various indications.

Speaking of Stem Cell Markets

Not only will NurExone’s therapies grow independently, but there is also already a solid market (stem cells) from which to snipe more market share.

Still trying to convince? More decision points.

  • Make no mistake: the potential for exponential growth is genuine for NurExone. PTSD is suffered by 8 million or 2.3% of Americans and 3.5-5.6% globally. For bipolar, the U.S. has roughly 4.5%–the highest in the world—against a global percentage of 2.4%. Interestingly, BiPolar is virtually nonexistent in India. 
  • NRX has an impressive patent portfolio, which includes the recently granted patent that ‘covers and protects our Exo-PTEN technology, drug composition, and methods for non-invasive intranasal administration of exosome-based treatment. 
  • NRX has several efficacies in its pipeline. Both are many and varied. For example, technologies to address.
  • Bipolar Depression (including treatment resistant Bipolar depression, Bipolar depression with suicidal patients
  • Treatment of chronic pain (including depression ion chronic pain) 
  • PTSD patients identified with Depression and suicidality.
  • Projected cash in 2023 is approximately USD2 million, and in 2024, USD1 million.
  • More importantly, NurExone has not, nor has it had, any debt projected for 2023,2024.

I will be the first to admit that while significant investment points have been touched on here for NRX, investors need to get comfortable with the growth potential of its market. That would entail reading the website and any additional materials.

 In closing, the growth stats of NRX’s market are undoubtedly robust, and likely extensive as traumatic injuries and therapies such as NurExone potentially supplant traditional stem cell treatments.

In any case, the growth potential for a company with proprietary therapies, cash on hand, no debt and ongoing developments looks to have the kind of moves that junior company investors should pay more than passing attention to.

Bob Beaty
+ posts

For over 30 years, Bob Beaty has been explaining concepts and companies to the global investment community. One of the original writers for Jim Cramer’s, he also wrote for AOL (Can/US), the Globe and Mail, and the Huffington Post. Over that period, he illuminated small-cap companies to investors with wit and pith but mostly opinion and facts. Investing should be fun. Pedantic, staid content is no fun.

Before embarking on his writing career, Bob had a successful international journey in the finance industry. He served as a broker, derivatives product manager, and a Director of London's Credit Suisse subsidiary. His career spanned across major financial hubs including Toronto, Vancouver, and the UK, giving him a unique global perspective. (He is still fondly remembering those English client lunches.)

Other than everything Groucho Marx and George Carlin ever said, Bob lives by a simple credo;

‘Never do anything the person standing in front of you can't understand.’ Hunter S. Thompson.

Let’s go.


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