I should have added that I'm not expecting significantly better results in these new tox studies than what was seen in the original ones. The results might be modestly better, but it seems unrealistic to expect vastly better results. While strange things can and do happen, we investors have to play the odds, so I figure the most likely scenario goes something like this -
1) Cortex does a medium size PIPE by early '07, this at least gives us enough money to get through 2007.
2) New data looks similar to the old data, perhaps slightly better.
3) In Q2 we get the word from the FDA on dosing liberalization.
4) AD looks potentially viable, and by Summer or so a deal is done with either a BP or Organon for CX-717/N.Amer Neurodegenerative. Even if AD doesn't look particularly viable for CX-717 dosing-wise, Organon might still be interested in the N.Amer Neurodegenerative rights since they have Org-24448.
Speculating further, one important question is whether to try to carve ADHD out of the deal, in hopes of advancing a backup (CX-701) with the goal of doing another pharma deal for ADHD in a couple years. That would be a very attractive way to go if possible. Of all the indications, ADHD is the one we are most sure about based on the stellar Phase 2a results. Dealing ADHD away for cheap to a BP whose main interest is in AD doesn't make much sense. As I see it, keeping ADHD/CX-701 inhouse would be greatly preferred over 1) a non-Ampakine in-license, or 2) CX-701/orphan or Sleep Related (although these should also be carved out, I doubt Cortex will have sufficient cash available to do both ADHD and an orphan program simultaneously).
Another key question is what to do with the high impacts. Some possibilities - a) include it in the CX-717/N.Amer BP deal, or preferably b) keep it in-house, get the lead compound (CX-929) into the clinic, and then license it to the pharma partner in a year or two.
One of the key factors that everything hinges on is the viability of CX-717 for AD at the currently allowed human dosing levels (we investors don't know what those levels are). Dr. Stoll said that the current dosing restrictions should "comfortably" allow continued AD human trials (extrapolating the doses which were effective in animal AD models to humans (1-3 mg/kg in animal models)). While this may be theoretically true, if the highest dose allowed in humans for longer term dosing is only say 200 mg, then I wouldn't hold out much hope for success in AD. We investors really need to get a much better idea of the actual human dosing levels currently allowed under the FDA restrictions, not just for a single dose study like the PET study, but for longer term studies. This is info that we don't have, and such info is critical in our determining if an AD deal is really feasible or not, and how much dosing liberalization it would take to make it feasible.
