Skye Bioscience Inc (SKYE)

[Paulieme]

Older article long,but interesting! JULY 28,2017-------------------https://theroadufollowed.wordpress.com/2017/07/28/therapeutic-effects-of-cannabis-and-nemus-bioscience/ (Nemus Bio-science)Part; Nemus develops totally synthetic cannabinoid molecules for therapeutic purposes. The company entered into a memorandum of understanding (MOU) with the University of Mississippi School of Pharmacy (UM) in 2013. The MOU outlines how Nemus and the UM will develop and commercialize cannabinoid therapeutics. Up until recently, the UM was the only entity permitted to cultivate cannabis for research purposes in the USA. This federal license was first issued in 1968. Nemus went public through a reverse takeover (RTO) in 2014 and is traded on the OTCQB (Symbol: NMUS). They have a fully diluted market cap of 15 million USD and will need to raise significant capital in the future. Since 2013, Nemus and the UM have entered into four exclusive option agreements for two cannabinoid compounds developed by the school. One of the compounds is a THC pro-drug; NB1111 is eye drops for glaucoma and NB1222 is a suppository for chemo-induced nausea and vomiting (CINV). The other is a analogue version of CBD; NB2111 for CIPN and NB2222 for different ocular targets. Nemus and the UM are working together to develop a composite of cannabinoids to fight methicillin-resistant Staphylococcus aureus (NB3111).

The UM first started publishing data comparing THC suppository formulations and Dronabinol in 1991. NB1222 has improved bioavailability since it bypasses the first past effect. When compared to Dronabinol, NB1222 has a longer therapeutic window and more stable dosing. Depending on the patient’s condition, suppositories can be a valuable delivery system. Nemus believes their suppository can efficiently deliver the API in a once per day dose. NB1222 avoids the upper gastrointestinal tract, which helps reduce nausea and vomiting. Nemus claims they will file a NDA for their suppository through the 505(b)(2) expedited FDA pathway in the future. Nemus will have to raise additional funds to show the effectiveness of NB1222 in clinical trials.

As glaucoma develops, intraocular pressure (IOP) is a risk factor that can cause eye damage. There is a large concentration of cannabinoid receptors in the eye. THC has shown to lower IOP in studies involving humans and animals. Furthermore, THC has neuroprotective qualities including disrupting deterioration of the optic nerve. While smoking cannabis lowers IOP, it has a small half-life and reduces blood flow to the eye. The UM began researching THC effects on IOP in the 1980’s. Nemus and the UM recently presented research showing NB1111 reducing IOP levels in rabbits similar to other glaucoma drugs with significant market share. The concentration of THC in the formulation was around one percent. The drops are absorbed in different parts of the eye, reducing systemic exposure and bypassing the first past effect. The rabbit ocular model is acceptable for regulators considering candidates for human testing. UM & Nemus have protected NB1111 with patents on the API and delivery system awarded in USA, Japan, UK and Hong Kong. Nemus will have to raise additional funds to show the effectiveness of NB1111 in clinical trials. The glaucoma market is hyper-competitive.

Abuse of opioids is a serious problem; Nemus intends to develop CBD derivatives for multiple types of pain syndromes in the future. Research conducted by Nemus and the UM has shown different composites of cannabinoids having synergistic bactericidal activity. All of the candidates will bypass the first past effect. The pathway to commercialization for the CBD analogue’s and NB3111 would be significantly more difficult than Nemus’s THC prodrugs. Pain relief metrics can be ambiguous and there are non-cannabinoid MRSA treatments that show promise. The ability to raise funds and continue their research into these indications will determine if they are viable therapeutics.

For Nemus to realize the potential of their pipeline, the company has to raise additional capital. When a company’s potential growth is based upon raising funds through issuing equity, individuals usually do not apply appropriate risk when modeling that company’s value. In the past, Nemus has raised capital by issuing equity and this is likely to happen again. This would be dilutive for existing shareholders. Nemus has never generated revenues and is unlikely to for the foreseeable future. Nemus went public through a RTO; the SEC has warned significant risks are involved investing in a company that has gone through a RTO. Individuals from the former company (Lock Guard Logistics) that received common stock as a result of the RTO have liquidated the majority of their holdings. The 1 year return on Nemus common stock is approximately -50%. Nemus has 11.5 million warrants outstanding with an average strike price of $0.40 USD. Nemus trades on a small exchange and has poor liquidity. Historical guidance from the company targeted 2017 for IND filings and commencement of clinical trials. Nemus has not filed an IND to date and is unlikely to begin clinical trials in 2017. Legal proceedings were brought against Nemus by their former CEO John Hollister in 2015. The claims and counter claims were withdrawn in 2016 by both parties; John Hollister submitted a statement expressing regret for beginning the proceedings. No payments were made by either party to resolve the matter.

The author believes total synthetics should be the standard when utilizing the cannabis plants therapeutic effects. They have better safety and economics when compared to plant-derived peers. Furthermore, cannabis flower, oil, gel caps and other edibles for medical use should be considered substandard. Nemus Bioscience has the most sagacious drug pipeline in cannabinoid drug development. The UM possess intellectual property superior to any cannabinoid drug developer. Nemus has chosen to advance candidates with objective measures and established safety profiles to reduce development costs. Historically, the company has been able to raise sufficient capital for their day-to-day operations, research and drug development. In addition, prior equity raises have been completed diligently. If this continues, it’s possible Nemus will advance NB1111 and NB1222 into clinical trials during 2018.