Your continued support of Nascent Biotech is very much appreciated by the Company’s management. Without it, we could not have achieved the completion of our Phase I Clinical Trial of Pritumumab. This significant milestone allows us to move to another significant milestone – Entering Phase II clinical trials.
We have submitted the clinical plan to the FDA and are anticipating clearance to begin soon. Once clearance is received, we will open the Phase II study as a multi-Center trial enrolling 6 times as many patients as Phase I, demanding more investment dollars. We estimate a need of up to $18.5 million to complete the trial in four tranches of $4.625 million each.
As you are aware, Nascent stock began a steady increase in early 2022 due to favorable announcements regarding the advancement of our Phase I trial, reaching a peak in August 2022. Several factors are believed to have led to this attention to our stock including:
- Systematic achievement of trial related advancements.
- Opening and completing each cohort in the study.
- Favorable outcomes in accordance with the trial objectives.
Since then we have experienced a significant decrease in our share price. The variables of the biotech industry come with various risks:
- Market Volatility – OTC stocks tend to be quite a bit more volatile than the larger exchanges and the markets at all levels are experiencing historically high volatility due to several factors.
- Arbitrage Risk – All companies are subject to this. Smaller OTC companies in particular.
- Research Companies – In the absence of revenue, companies rely on favorable news due to milestone achievement to create value.
- Short selling – Smaller companies are more at risk to this.
Nascent experienced a dilutive event as better alternative investments were not available. As reported in our filings, we closed on a convertible investment of $2 million to complete our Phase I trial and prepare for Phase II. This resulted in a dilutive event and put downward pressure on the stock price.
As we achieve the milestone of opening Phase II, we expect to receive a milestone payment of $2.5 million in non-dilutive funding from our Chinese partner, Bioray. Upon treating the first patient in a Phase II setting, an additional non-dilutive payment is expected of $750,000 totaling $3.25 million in non-dilutive funding. Although this funding will not fulfill the capital requirements to complete Phase II it does ease the burden of shareholder dilution. As we look to secure future the funding needs, we will always turn to present shareholders for the first opportunity for investment prior to committing to alternatives which may create an overhang on the Company stock.