RespireRx Pharmaceuticals Inc (RSPI)

[gfp927z]

While there presumably is pharma interest in each of Cortex's program areas (RD, ADHD, Neurodegenerative), there must not be strong interest between multiple parties within each category. That would explain how a company could jerk us around for so many months, something that couldn't happen if there were 2 parties strongly bidding on one particular program.

So Varney probably has a single pharma with strong interest in RD, and perhaps another single pharma with interest in ADHD. But this doesn't create bidding competition, since for that you need two pharmas with strong interest in the same program.

With CX-1739/ADHD, Varney really wants to keep it inhouse if possible, so he's reluctant to partner it if he can't get relatively high upfronts for it (since he'd lose his only clinic ready compound, and also lose his best indication for the future). And with Neurodegeneration, there are probably numerous interested pharmas, but since it's so early stage, Varney isn't getting the upfronts he needs.

Bottomline, if the above is accurate, then the single bidder for RD has a lot of leverage. He has no other competitor bidding on the program he wants, so time is on his side, with Cortex's money rapidly running out. One way the single RD bidder could lose though, is if he waits too long and Cortex is forced into a distress sale, and another pharma walks away with the whole company. Other than that possibility, the single RD partner has the leverage.