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Just looking back over the last 12 months. Two highlights:
Sept 27: Professor Frederick R Carrick at the 6th Cambridge International Conference on Mental Health
It's worth looking up the announcement and reading. The share price movement was, in my opinion, justified. However interest rapidly fell away when it became clear that nothing would be made available publicly beyond the quotes announced to the market. The Carrick Institute did not deliver a paper at the conference, nor would they make anything available in writing to NTI.
Jan 8: Clinical Trial Update
Although the share price fell rapidly from the September peak, interest remained elevated as the remainder of the Carrick Institute trial was completed. The price peaked early in December, in my opinion due to people taking positions ahead of the trial results, and an incorrect expectation that the trial would be completed at the beginning of December. More sustained and intense buying occurred at the end of December and into January, again in my opinion due to the expectation of the trial results. This was crushed on January 8 when Neurotech announced that the Carrick Institute would not release the results to Neurotech until a paper had been prepared and published. The original announcement was somewhat unclear but the clarification issued on January 10 left no room for doubt. It would be several months before the results would be released.
The interesting thing about this is the clear irrationality of the market. In August/September last year the market valued Neurotech shares at the same price as they do now. And yet we now possess a critical piece of information, released by the organisation conducting the study: "we can state with statistical significance the effect of the Mente Autism device ... half of the children in our study have completed it and we have observed "major positive changes in the children in the active arm of the study and no statistical changes in the control group".
Those key words: "major positive changes"
Further, one of the observers at the conference - Dr Ahmed Hankir, a Senior Research Fellow with the Bedfordshire Centre for Mental Health Research - stated: "The Child Autism Study using the Mente Autism device is one of the most exciting investigations this year. The changes observed in autistic children after a 12-week clinical trial are outstanding with many of the children with autism scoring in a normal range after the treatment. We are thrilled to review these incredible preliminary findings and are looking forward to the publication of the final study outcomes."
Those key words: "many of the children with autism scoring in a normal range"
In addition to the study in progress at the Carrick Institute, Neurotech have been preparing the road to commercialisation:
1) A design and manufacturing agreement in Europe
2) Distribution agreements into key markets across the globe
3) CE Mark approval to support European distribution
4) Preparations to apply for FDA approval once the study results are available
In my opinion Neurotech management have done a rock-solid job with both the scientific and the commercial aspects of the business.
I believe that the available evidence about both Neurotech as a business, and Mente Autism as an effective device justifies a share price considerably above its current level. In fact, I would probably call it a buy at 30c. It's my opinion that the current price reflects the slow pace of the news flow, and the delay in having the study results released. Those looking for a quick return have hopped out, looking for quick returns elsewhere. The rest of the market has little reason to look at Neurotech.
Thus, Neurotech appears to still be a bargain. That will probably end with publication of the results by the Carrick Institute, as long as they meet the expectations we developed from the Cambridge Conference. There's no way of knowing when that will occur. It could be within the week, or it could be months away.
I think that in the circumstances, patience is the best option.
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