After the Human Research Ethics Committee (HREC) rejected the Company’s flagship drug, EmtinB, knocking back years of research in the process, disappointed CEO and Managing Director, Mr Matt Liddelow, announced that he is resigning from his position immediately. 

Liddelow noted, “I acknowledge the loss in shareholder value as a result of the rejected Human Research Ethics Committee (HREC) submission and I will work tirelessly with my NSB colleagues to do what we can to get EmtinB into a Phase 1 clinical trial as quickly as possible.”

All year, NeuroScientific Biopharmaceuticals (ASX: NSB) worked towards one goal: commencing the first in-human trials of EmtinB, a potential disease modifying treatment for Alzheimer’s disease, multiple sclerosis, and glaucoma. The Company expected to proceed further with the trials, partnering with multiple companies, including Linear Clinical Research, BioSpective and Imeka to see through the drug’s effects.

No doubt, the rejection came as a significant blow to their mission and is being appealed by NeuroScientific Biopharmaceuticals. Still, recognising the devastating shareholder response, Liddelow decided to step down.

NSB Chairman Mr Paul Rennie commented on his departure, “I would like to acknowledge Mr Liddelow’s service of approximately 4.5 years and thank him for his efforts during that time. The Company will commence a domestic and international search for a new CEO who has pharmaceutical development experience.” 

In FY22, the Company spent over $7 million on research and development for the drug, up from $2.2 million in 2021. This expenditure was predominantly driven by preclinical studies and manufacturing activities to support the commencement of clinical trials during 2H FY22. It incurred losses amounting to approximately $10 million and witnessed a nearly 50% decline in cash and net assets at the end of June, 2022—all in the pursuit of HREC approval for in-human clinical trials.

NeuroScientific Biopharmaceuticals was as prepared as could be, which is why it didn’t see this coming. Rennie added the Company’s senior management team will continue reviewing operations and making changes to ensure EmtinB reaches the markets.

Pointing to his tenure, Liddelow commented, “I was attracted to NSB, and remain excited about the company because of the potential of EmtinB to help people with neurodegenerative diseases.” 

The Company is awaiting a detailed reasoning behind the committee’s decision to decide its next steps. In the meanwhile, a management restructure is underway so that NeuroScientific Biopharmaceuticals is better positioned for the path ahead.

Though it is difficult to ascertain what went wrong, the Company is hedging its bets on new leadership to bring things back on track.