This week in the China Shop, we are joined by our first CEO, Dan Legault of Antibe. Listen along as we learn more about the pharmaceutical industry in general, as well as Antibe’s potentially revolutionary hydrogen sulfide platform. Mr. Legault was kind enough to answer many questions submitted to us by the shareholders on Stocktwits, and ended the interview with a promise to those investors.

2 Bulls in a China Shop: Recorded on 06/07/21

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SPEAKERS: Kyle Hedman, Dan Leeson, Dan Legault

KH: You are listening to an entertainment program put together by a company called Financial Ineptitude. Anything said on this show is not an endorsement, or professional advice. Would you really want to tell a court of law that you were suing us because you thought taking financial advice from two idiots on a podcast put out by Financial Ineptitude was a good idea? Really? Clown hat, smiley face.

DL: Financial Ineptitude presents 2 Bulls in a China Shop. You can find our podcast at or just search 2 Bulls in a China Shop wherever you screen your podcasts.

DL: Hello and welcome to the china shop. I’m opening the doors today. It’s shopkeeper Dan here, with me as always is Kyle, creator Hey, Kyle, you got anything clicky in your hand right now?

KH:  No, no. This is the third or fourth time we’ve tried to record this intro.

DL: Oh yeah, yeah. I keep picking things up and making stupid noises. Anyway. I’m doing fantastic. We got a crazy awesome interview for you today. But first let’s check in, check in. How are you doing today, Kyle?

KH: I’m fantastic. Still.

DL: Still. All right.

KH: For the fourth time.

DL: For the fourth time, Kyle is still doing fantastic. Oh. Well, I think we better just jump into it then.

KH: Yes.

DL: So, let’s introduce our guest. Folks, we are so super, super excited. We’ve got with us today Dan Legault from Antibe Therapeutics. How are you doing today, Dan?

Dan Legault: A real pleasure to be to be joining you. One in Illinois, and one in Arizona. Awfully excited.

KH: Been really excited about having you on the show too. I gotta say we’ve been interacting with some of the investors on stock twits and oh my gosh, you guys have one heck of a knowledgeable group of investors there in the retail world.

DL: Yes.

Dan Legault: Yeah, that’s great. I correspond with a, with with a number of them. I sort of make it a point of pride of corresponding with anyone who emails me. We really do have a group of loyal shareholders and we love them, of course.

DL: Well, and that’s, in this modern era of investing, that’s one of the things that catches my attention, is the excitement level. Because a lot of retail, you know, retail investing is changing. We’re, there’s a lot more research available, and a lot more people sharing their knowledge. So when there’s excitement on social media that I come across from from people who, when you talk to them, they’re very informed, very informed. That’s that’s a good sign to me. And to know that the company themselves are reaching out and interacting, right up to the CEO level, that’s fantastic. That’s fabulous.

KH: Sounds like you actually set the trend before Aaron, yeah Aaron Adams from AMC did. I think he’s been getting a lot of love for being on Twitter.

DL: Right right. So, Dan, tell us a little bit, where did, where does the name Antibe come from? Because I know you’re a pharmaceutical company, and you know, maybe I’m ignorant down here in the States, but Antibe doesn’t evoke the feeling of medicine to me.

KH: Right?

Dan Legault: Yeah, no, we love the name. It’s actually named after the town of Cap D’Antibes, a beautiful medieval town in the Mediterranean, right near Nice, between Nice and Monaco. It sort of juts in there, now it’s a bit of a jet set place. It’s sort of a romantic name for a biotech company, but our founder and my longtime, but my, our founder and my longtime friend, and our Chief Science Officer, John Wallace, he was, he was chairing the Science Board of Advisors of an awfully cool French company. And that area really is the Silicon Valley of France, and so when he would go over there for a meeting, he would hang in Cap D’Antibes, and just fell in love with the place. And I went, because I spent a lot of time in France, and it’s just, it’s just adorable. And so he said, you know, he was on to the thing that we’re on about, and so he said I’m going to name the company after this beautiful amazing place, and of course we love the name.

DL: Oh yeah.

KH: It sounds a lot better than you know Oronto or…

Dan Legault: Yeah, or Tech Rx or something.

KH: Well, Dan, do you want to tell us a little bit about what your company does? The otenaproxesul, the hydrogen sulfide platform in general? Like how you guys developed it, how that came into being, where that’s going, the uses, all that kind of good stuff.

Dan Legault: Sure. So, we’re attacking the Yeah, age-old problem of the ulcers and bleeding that you get from common everyday painkillers. I bet the two of you take them, I do from time to time, along with 90% of Americans. It’s, these are the non-steroidal anti-inflammatory drugs, aspirin, Advil, naproxen, Aleve, Motrin, you know, it just goes on and on. They’ve been around for 50 years. Aspirin has been around for 100 years. For the full 50 years, it’s been known that they cause ulcers and bleeding in the stomach and the intestines in about 25% of people. And it’s been an incredibly hard problem to solve, but there are no good alternatives. They don’t, there really are, it’s only really the So, opioids, which have their own problems. So that’s why doctors prescribe them every day. And so so many people take them in, you know, 90% of Americans, two billion people around the world. And then you, then they monitor you, you know, your lovely Congresswoman, of course, Debbie Dingell just had an issue, just bringing it right to the fore. We think we have solved that. And it’s, and it’s actually quite, quite fascinating, this age-old problem. I mean, if you can solve this problem, you’ll sell $30 billion 30 billion with a B, a B for Bob. And that’s actually well-known so everyone in their uncle have gone, or taken a run at this problem over the past 30 years, including almost all of major pharma, and came up with drugs such as, you know, like Celebrex and Vioxx, for example. These drugs were a bit better on the stomach and intestines, but they were killing you for heart reasons, and so most of them were withdrawn, and not a good thing. Celebrex never was, it became, and continues to be a large moneymaker. But in 2008, the American Heart Association came out with a strong recommendation that doctors start with Naproxen, which is now the dominant NSAID in the United States for osteoarthritis. And, as it turns out, my college roommate, who would have thought, this smart, funny guy by the 70s, he’s, he’s a superstar, and your readers would see that in 10 seconds of due diligence, just Google it. John did his post-doctorate in the 80s for John Vane. John Vane is better known as Sir John Vane, a Nobel Prize winner for discovering how aspirin works, no one knew. And 10 years later, my John is credited with discovering how these drugs cause the ulcers and bleeding, just a huge discovery, and there’s a whole body of work there, and he’s gone on to be a superstar in the field. And then very interestingly, 10 years, you know it’s (inaudible) and then 10 years later, John made another major discovery, namely that hydrogen sulfide is the body’s key mediator, or manager, of inflammation. He did that around 2002. Just huge, you know, how John came to be working with hydrogen sulfide is through his and our longtime association with Lou Ignarro from UCLA. Lou himself has the Nobel Prize in Medicine from 1998 for his work with what are now called the gaseous mediators. So nitric oxide, hydrogen sulfide, they both come out of smokestacks, and carbon monoxide comes out of the exhaust pipe of your pickup truck. I mean, who would have thought, these things were known for a hundred years as poisonous gases, but at the individual molecule level, they play key roles in our body, hence the, their signaling molecules. They carry an electrical signal across the cell wall or across the synapse, and it’s just fascinating, and of course, you know, wins a Nobel Prize.

KH: And so how do you figure that out? Like how do you even get to that point, like, you just well, I think I’ll just try injecting some hydrogen sulfide into this little creature and see if it repairs some intestinal damage. I assume it’s more than that, but.

Dan Legault: Yeah, it’s a bit more than that. But, but fundamentally, the thing that eases the inflammatory pain is the same, it’s the same thing that causes the ulcers and bleeding. That’s why it’s been such a hard, hard problem to solve, to solve. And so, all these people who have put buffered coatings on it, or extended, it doesn’t work. It, that’s why it’s been so so hard to solve. And so, so when John, John just, he is at base, a scientist, like, you know, and he works with mice and test tubes. And when John discovered that hydrogen sulfide is, he was actually, it really was an aha moment. You know, quite like the light bulb going on. He saw in the, in the blood vessel, and we have a movie, it’s fascinating, you know, you see the blood flowing along this venule. Yeah, the venule in the intestine of a rat. And then every now and then you see these white little globs sticking like Velcro to the blood vessel wall. Those are neutrophils, these blood components, and that sticking, that Velcro-like action is the first part of the inflammatory cascade. And then those things migrate into the tissue and cause all this inflammation. And John realized, because he can halt the natural production of hydrogen sulfide, John realized that oh my gosh, if I stop that, these proliferate, the Velcro action really increases, and it’s hydrogen sulfide that prevents that. And so, John then had this brainstorm idea, very simple. And he said, you know, what happens if I took a molecule, namely a drug, and I attach to it another molecule that will release hydrogen sulfide, and the combined molecule, you know, it will be a new molecule, I can get a new patent for that. And so, John made, with chemists, three chemists, made dozens of these. Dozens of donors, and then dozens of NSAIDs. And so, we have a lot of these, and we’re bringing three to market. It’s not easy to do, and it took years. And then we chose, of course, the best ones. And so otenaproxesul is essentially a molecule that releases hydrogen sulfide, attached to the naproxen molecule, it acts like a new molecule, albeit exhibiting characteristics of naproxen, which is the main NSAID in the United States, and the results have been, the results, as you can see, have been phenomenal. We have more published work in academic journals, this is not your Friday night reading, let me tell you, but we have more published work than so, Merck or Pfizer, or anyone, that’s because John has been doing this for 30 years, and with our drugs for 15. But so, we really do have an abundance of data, including in all the difficult stuff where you take animals, and you use diseased animals, or animals that have some sort of compromised defensive systems, and NSAIDs, you know, if you give them an NSAID, the bad damage will triple, whereas with our drugs it will remain safe. And now we’ve shown this in our large Phase IIB study with 250 people. So, you know, for a boring problem of ulcers and bleeding in the stomach and the intestines, it’s pretty exciting. We are very excited.

KH: That doesn’t sound boring to me, though.

DL: Yeah.

KH: Sounds like a real problem.

Dan Legault: Yeah.

KH: Yeah, why did it take so long to So, you know, you said 2002? That’s when he kind of made this discovery. Why does it take so long to get something developed like that?

Dan Legault: Well, first of all, there’s a lot of years of science, and then John is also, John is also an expert in inflammatory bowel disease. And, and we worked on inflammatory bowel disease, and then when the 2008, and then we’re working on the NSAIDS, so when the, when the 2008 financial meltdown happened, we were going to do all of our various drugs, we were working on a whole series of diseases, we were going to do them all simultaneously. And after the 2008, financial meltdown, we said, let’s just concentrate on our best ones, and which happened to be also the largest market. And they were the most recent from a patent, which were the NSAIDs. So, we really started from scratch in 2009. Nonetheless, it takes a long, long time to develop drugs, you know. It’s, we’re 50 years later than thalidomide. And so, the, you know, it just gotten it’s, that’s why it’s pretty amazing for the whole world to come up with these vaccines so so fast. But normal drugs take 15 years or so.

KH: Yeah, that’s the 1962 amendment, I can’t remember the actual name of it, right?

Dan Legault: Yeah,

KH: Yeah, what was the name of the drug?

DL: Thalidomide.

KH: Thalidomide, thank you.

DL: Yeah, it caused all the birth defects.

Dan Legault: Yes, correct.

KH: Yes. I can’t understand how anything ever gets done, with the way that that regulation is written. I mean, it went from like two years to develop something to 14 after that, or 15, I think it was.

Dan Legault: Yeah, it’s so, a strange business model. You know, you can be worth a billion dollars. most analysts think that that’s what we should be worth. You could be worth a billion dollars and still be several years from revenue. It’s just, it is a you know, it’s a rather from an, from a retail investment point of view, it’s a challenging field. It’s not like software, it’s wildly more complicated.

KH: Well, and you need investors that are going to be in it for the long haul, too, because they have to wait through a long development period. It sounds like you guys are getting really close, though. You finished your Phase II, it looked like you guys got approval to, not sure if that’s plan your Phase III, I think you’re able to submit the plan for that?

Dan Legault: We received our IND from the FDA in the United States. And that essentially means we can do clinical trials in the United States. We have a small one going on right now, a small study of volunteer, a scientific study as we’re getting ready for our Phase IIIs. We only filed here in the United States recently, because we did all of our work, we’ve already been in, we’ve already done five or six clinical trials and hundreds of people we did it in Canada. So, guess how many pages, here’s a fun fact for you, guess how many pages our IND application was to the FDA.

KH: 702.

Dan Legault: Again?

DL: 703. 1,500 pages?

Dan Legault: I asked my daughter this, to guess this, when she was doing a major paper for her third year at university. She said 300. 55,000.

KH: Oh gosh.

DL: What?

KH: I thought I was being facetious.

DL: 55,000 pages?

KH: It’d take you two years to write that.

Dan Legault: Oh, it was a whole team of us. Yeah, no, it’s just yeah, it’s amazing. It’s interesting.

KH: So, FDA approval gets you licensed in America, does Canada reciprocate that? Or can you get licensed in other countries? Like is it if you get FDA approval here, are you good to sell anywhere else? Or do you have to go through the approval process everywhere?

Dan Legault: You have to go through the approval process everywhere.

KH: Oh my gosh.

Dan Legault: However, then it’s infinitely easier. First of all, there is a lot of harmonization, you know, through diplomacy over the decades. All the Western world countries certainly have sort of more banded together, and they provide a lot of respect for studies done elsewhere. And this is particularly so with the So, FDA. The FDA is clearly the premiere agency, the next important one is Europe. So, for example, it would not, if we were approved in the United States, it would not be difficult to get approved in Canada,

KH: Okay, so you wouldn’t have to basically start from scratch then, you can at least use some of that other work, it sounds like.

Dan Legault: We use all of it. We would not have to do any more scientific work. For Europe, we would have to do an extra study, and for Asia, we would have to do smaller extra studies, because there are some genetic differences, and that sort of thing. But by and large, the world would rely on the US data.

KH: It looks like you partnered with, or you developed a licensing agreement with Nuance Pharma as part of that, for them to do those approval processes throughout China?

Dan Legault: Yes, we are thrilled, a great company. It was our fourth deal, actually. Yeah, we’ve licensed otenaproxesul for some 50 countries. China was the largest one. We were, and these things help. They give us validation, they give us non-dilutive money. But now, we’re now in dialogue for the large markets in the Big Five in Europe, and the United States of course, and Japan. But we were very very pleased with the Chinese deal. First of all, those, the terms were quite attractive that we received. It sort of raised the eyebrows of the industry, because we negotiated quite nice terms. And they’re a great company, they, you know, their CEO more or less built the commercial franchise for AstraZeneca, and he is a South African, but deeply knows the Chinese commercial landscape, which is rapidly evolving, actually. And we received really nice money, plus we have essentially a veto, and it’s a quite a friendly partnership. But they want and respect our involvement in their clinical trial process, we’ll have to do a Phase III trial in China.

KH: Do you worry at all about intellectual property theft? I think China’s kind of known for that.

Dan Legault: Yes, you do. Less so in the pharmaceutical world, because it’s, you know you can, our recipe is on the internet, and you can get it in two hours. It just you can’t sell it. So, it just takes years, and China wants to sell drugs to the rest of the world. They’re getting, their So, industry is becoming very very sophisticated, and so this is not going to help them from a reputation point of view. But Nuance is very Western oriented. All their senior team have extensive Western company experience, so the concerns are legitimate that you’re talking about, but they’re minimized with the case of Nuance.

KH: Gotcha. Dan, I think you started asked a question about four or five minutes ago?

DL: Yeah. So, these drugs, they are going to be, are they going to be over the counter when they make it to market, assuming they make it to market?

Dan Legault: Eventually. Usually, over-the-counter drugs start out as prescription drugs. So then you need more extensive studies to bring them over-the-counter. So, naproxen as I mentioned, which is a, you know the dominant NSAID for So, osteoarthritis, for example, in the United States. It took years, but then became, at half the So, standard prescription dose, became Aleve, an over-the-counter drug. And Aleve is only, you know, it was only just a short number of years ago that it was approved for over-the-counter in Canada. So, eventually. But the prescription market is massive, just from a prescription point of view.

DL: Yes.

Dan Legault: Should, you know, should we get to market, the big, there’s still risk Should we get to market, just in the, you know, just in the five main countries of Europe, Japan and United States, and just in those seven countries, and just for osteoarthritis, let alone low back pain and everything else. You know, we’ve done extensive commercial studies. These were done by well-known strategy consultancies. You know, just in those seven countries and just for osteoarthritis, we would likely sell over $4 billion a year of prescription drugs, just in those seven countries at our peak year of sales. So, I mean we’re focused on the prescription market. We would you know, we would be long gone, you know, before a large pharma took our drug over-the-counter.

DL: So yeah, speaking of, yeah, you’d be long gone by that time. There was some buzz on the online communities talking about, wondering about, I should say, the depth of your scientific and research team, and do you have a succession plan? Because like Dr. John Wallace seems to be a guru, amazing genius scientist man. And people worry like, what if he got in a car wreck tomorrow? What would the company, what would happen to the company?

KH: Also, that question is from Louise, so thank you, Louise for submitting that.

DL: Yes, thank you, Louise.

Dan Legault: John was my college roommate, as I mentioned, 40 years ago. So, we’ve been, we’ve been friends for a long, long time. And so, John, if he, god not willing, if he got hit by the proverbial bus, oh, I don’t think we would, we wouldn’t really skip a beat, because he’s a base scientist, and we’re so far beyond that with our lead drug, because it’s all regulatory development. But for newer discoveries, which we’re very keen on, but you know, they take time, John’s hugely, just hugely valuable. And as a matter of fact, at Christmastime I wrote an internal memo I called Christmas thoughts, and because of, because of John’s discovering hydrogen sulfide, and our knowledge now that hydrogen sulfide plays so many roles, not only the main, in inflammation, but also in cellular repair, and cellular protection. I mean it’s now known, it wasn’t known when John was all this, it’s now known that every cell in our body makes hydrogen sulfide. Every cell in the body, most of it in the brain. So does the bacteria. Hydrogen sulfide makes ATP, you know, poor Miss Berry, my lovely high school biology teacher would turn over in her grave, you know, because we were taught that oxygen is needed. But hydrogen sulfide also makes fundamental unit of energy in a cell.

KH: Really?

Dan Legault: Yeah, and as a matter of fact, you know, when life was forming on our planet, some 2.6 billion years ago, there was no oxygen, it was all hydrogen sulfide. And so a lot of scientists think that’s why it’s so important. Oxygen didn’t show up until 2 billion years later. Oxygen has only been around for 600 million years in our atmosphere. I mean, just fascinating. So, we want to move beyond the gut into all sorts of things. This is our long range, and we’re mighty focused on otenaproxesul, of course, because that’s where the vast majority of our value is, but we you know, we love this, and so we want to move beyond. And so, the strategy, I called it, we need more baby Johns. John, and you know, when John was doing all this work, he was about 38 years old, you know, in that magical time, from 32 to 48, he was just, pumped through an enormous amount of stuff. But we’re very interested in respiratory illnesses, and Alzheimer, and cardiology, in anti-infectives, and that sort of thing. And each of these needs, you know, that 35-year-old John Wallace. So, but we know so many people, and so we’re actively in dialogue on those things. And they don’t have to work full time for us, they can be academic professors, you know.

KH: Does the hydrogen sulfide show any promise in those regards, or are you still just looking at the basic levels at this point as far as like Alzheimer’s and that?

Dan Legault: Oh, just shows huge promise. I mean, we’ve long predicted that they’re going to find the link to Alzheimer’s, I mean whatever the hell Alzheimer’s is. You know, are all these tangles, is that the result, or is that the cause? I mean, you just know that inflammation is at the cause of it and observationally, five years ago, it was observed that Alzheimer’s patients have markedly less endogenous, endogenous means, you know, naturally producing, much less natural production of hydrogen sulfide. And sure enough, just after Christmas, Johns Hopkins put out a paper showing the link to hydrogen sulfide. So, you know, I would, I would bet you a beer that in my lifetime, in my lifetime, Alzheimer’s is going to get, will get solved by some sort of medication involving hydrogen sulfide.

KH: I hope it’s quick, because my family has a history of it.

DL: Yeah, yeah. I’d love to see Antibe come out with that drug. My family too.

Dan Legault: Yeah, yeah, me too. Though that’s, unfortunately, that’ll take some time. But that’s something that we would love to explore.

DL: Yeah.

KH: Oh, you mentioned the otenaproxesul or being, or at least the opioids being something that you’re looking to replace with your hydrogen sulfide platform. Have you seen any opposition from the opioid industry?

Dan Legault: Oh, no, none.

KH: Any smear campaigns or anything like that?

DL: Nothing shady?

Dan Legault: Oh, I think we’re too tiny for So, them to.

KH: Okay.

Dan Legault: And besides, I mean they sort of learned their lesson. I mean, no, no, I think they’d be the first to acknowledge that it’s a big enough world out there, and the world definitely needs safer pain medicine.

KH: Yes. For the, as far as the phase, the different phase trials go, can you explain the difference between like Phase I, Phase II, Phase III?

Dan Legault: Absolutely.

KH: Like, what are the metrics that, yeah, we’ll just start with that, and I’m sure I’ll have more as we go.

Dan Legault: Sure, absolutely. Let me start even earlier, and I can do it pretty quickly. Generally speaking, you know, after the Second World War, most drugs, almost all the drugs came from Big Pharma. Today, much much less than 20% of drugs come from Big Pharma. They mostly come from small companies, like Antibe. Science is exploding, and one company can’t know everything. So, the general, the, you know, the rough general idea is that neat discoveries happen in universities, and then if you can get what is generally called academic proof-of-concept, meaning they get a discovery, they do all sorts of stuff, and then they put it into animals, and then they, like rats and this, and they went, oh my God, I’m onto something. At that point usually a company would have been formed, at that point, it can generally attract real money, because at animal proof-of-concept, you start what is called the IND enabling studies, like the formal studies that you need to do to be able to put a drug into a human being. That’s called the IND enabling stage. And then you file for your, you know, you file for your first human trial, and that is generally called the Phase I. You use healthy volunteers, you know, university students, or whatever. And almost every drug does a very similar Phase I program. And it’s just for overall safety. And it’s, these things are extremely well controlled. Doctors 24/7, and that sort of thing. So, and they’re all very similar. So, if you do that, then you do Phase II. It’s usually two or more trials, but essentially, you’re trying to show human proof-of-concept. So now, now you’re actually in patients addressing the issue that, for which you’ve designed the drug, and you’re also trying to set the dose for the Phase III trials, and that, but the Phase II is, generally culminates in human proof-of-concept, and then you go, move on to the Phase III trials, which are generally a repeat of the Phase II, but for longer duration, and in larger numbers of people, and that’s Phase III.

KH: So, if you show promise in Phase II, I mean you’re not necessarily guaranteed to show the same thing in Phase III, what are some of the pitfalls then? Or why do you think that is?

Dan Legault: Sure, I mean, it used, the Phase III used to be particularly risky, the risks have gone down over time, but the length of time, you know, the length of work, and the numbers of things you have to do prior to that has increased also. So today on average, and you know, on a bell curve on average, about less than 20%, which is quite still risky, but quite lovely. Fewer than 20 percent fail. The vast majority, sometimes they fail for lack of efficacy or you know, you just can’t meet, you were in other words, your proof-of-concept might not have been all that strong. Or more likely, you fail for some unknown problem because you’re doing much, you’re you know, you’re doing a much longer duration trial, or, and in larger numbers of people.

KH: So, more chances for like side effects to pop up or something that?

Dan Legault: Yeah, exactly.

KH: Okay.

Dan Legault: And if, if you know, we’ve only been in human beings for two weeks, and yet otenaproxesul would be a chronic medicine, meaning that you can, you know, take it every day for the rest of your lives. So, our Phase IIIs, we have to do, you know, the primary Phase IIIs are two, all Phase IIIs need to be two identical trials in different locations. And the primary ones are these pain trials for us, and placebo control. However, 100 people, at the end of the three-month trial, 100 people will continue for an additional nine months, the, you know, the blinding will be broken, so they’ll know they’re on a drug, but they will be monitored. So, we will have at least 100 people for a full 12 months. That’s a requirement for our drug.

KH: Now this question comes from the Stocktwits community, user MH5555. He wanted to know if there is was reason for the staggered Phase III versus running concurrently, because he said that in his mind that would increase the, or extend the timeline significantly.

Dan Legault: That’s a very astute question. The reason for that is, our first Phase III trial, we’re going to do multiple, have two arms of our drug. Our drug has shown more efficacy than we thought it would in the Phase IIs. And it has given us, it’s given us you know, the good problem, or the nice problem, that we still have not found the lowest effective dose.

DL: Oh.

Dan Legault: And generally, the FDA, certainly in pain drugs, you know, the classic funny line, like how much drug do you give? Well, as much as you need, and as little as possible. So, the FDA will require you to show the lowest effective dose, and so we haven’t yet done that. We did three doses in our phase, but all three of the doses showed great efficacy. So, we’re going to do a two-arm dose and halfway through there’s a chance that we can then start the next trial but that’ll be at the dose that we discovered to be the lowest effective dose, so that’s why it’s staggered.

KH: So, the problem is you haven’t figured out how little you need to be effective?

Dan Legault: That’s correct, yeah.

KH: That’s a great problem to have. He had another question here that I though was pretty good too. Are you guys exploring other partnerships to advance other HS2 drugs into trials faster? Like leveraging other larger biotech companies to run those trials for you?

Dan Legault: Well, we are. We, you know, we are on the classic, you know, when I describe the various phases, from a business point of view the, generally speaking you know, of course, there’s all kinds of exceptions. But generally speaking, the optimal time to partner is sometime after Phase II while you’re doing the Phase IIIs, and that’s what we’re doing. So we are on the classic parallel track, moving forward as expeditiously as we can, and we have the full team and capability doing that, and money, which is fantastic, to do our Phase IIIs while in parallel. We’re now engaged in dialogue with partnering our drug, and so you know, should we get a good offer, and from a very reputable larger company, we would probably hand over all routes and pass the baton, and then move on to our, to our other drug.

KH: And you have three of those in the pipeline right now, from what I could see on their website? 352 was one that looked really promising, but that one looked like it hadn’t done, or is in the middle of Phase I? Did I see that right, or is pre-trials?

Dan Legault: It’s in pre-trials. They all are, yeah.

KH: Okay, pre-trials.

Dan Legault: ATB-352, ATB-340, and we’re moving forward again, on inflammatory bowel disease. We don’t yet have a numbered (inaudible) there, though we have 60 molecules that we’re actually screening at the moment.

KH: Has anybody submitted Dr. John Wallace for a Nobel Prize yet? Because I mean, good lord,

Dan Legault: You know, I know you’re sort of teasing but here’s a…

KH: No, really. I mean, seriously, yeah.

Dan Legault: Yeah, here’s a neat human story. I mean, I’m not a scientist, I’m a lawyer in my previous life. But I was, you know, if you look on our website, you’ll see the science advisory board, and I was at, I was going to you know, we had a whole bunch of us, we were actually in London, England, so prior, pre-pandemic, but a whole bunch of us were. I was sort of, I wasn’t saying much, but I was sort of leading it, you know. We’re in a conference room, and we’re then we’re going to go for a great dinner, because all these people are friends, even though they all live in other sides of the world, brainstorming new potential areas for us to So, explore, which is so fascinating it was it was great. And it was a brainstorm among people, many of whom have known each other for decades, and all eminent scientists you can see them all, they’re on our website. And you know, just from a body language point of view, the deference shown John was fascinating, including by a Nobel Prize, including by a Nobel Prize winner.

KH: Oh, wow.

Dan Legault: But they really do think of John as, as the real deal, you know?

KH: It sounds like it, oh my goodness. Dan, do we have any other reader questions, or questions from the Stocktwits community?

DL: Yeah, we’ve got quite a few. The one I wanted to ask, before we mined for another one of those, I noticed there was very recently, within the last couple days, there was news of an amalgamation transaction?

Dan Legault: Yes.

DL: Could you explain to us what that was?

Dan Legault: Sure. So, in 2004, John, he had now come up with a whole series of candidates and they were looking very very promising, and started a company Antibe. And then he actually googled me, because we never lived in the same city after So, university. And he said I’m onto something, so we flew into Toronto, and so we moved this forward. And my plan was, I’m going to put each indication, each family of drugs, into a separate wholly owned subsidiary company, then finance those subsidiaries separately, because one venture capital company might not be interested in inflammatory bowel disease, but very interested in pain, for example. So, I was going to do each indication in a separate subsidiary, and that was, so but then, as I mentioned earlier in this conversation, with the 2008 financial meltdown, I mean biotech financing was just decimated.

DL: Done, yeah.

Dan Legault: And I realized I wasn’t going to be able to do a whole series of indications simultaneously, that would have been too hard to find finance. So, I sucked it up, and decided to move forward with our, the drugs that were performing the best. (Inaudible) the most recent IP, and just huge market in otenaproxesul, and its colleagues, 352 and 340. And so, but to finance that well, we put it into a wholly owned subsidiary, and then I you know, then we financed, the classic friends and family financing, and raised about seven or eight million dollars. And then took that company public back in 2013. And so, you know, but we have long, I mean we’ve discussed it, you know, in our various things, we have long wanted to bring those two companies together to unify the IP. Now that we’re talking to Big Pharma to, you know, ideally, they’re not going to want to deal with a public company and a private company. And that private company is not a university, it’s a company. John and I were the major shareholders of that company. And so, we, that company could go bankrupt, whatever, it could get into lawsuits. It’s just not an attractive solution for Big Pharma. So, we always wanted to unify the IP. And so, we just did a lot of legal and tax analysis, and decided that, the lawyers decided the best way to do it was by a true formal amalgamation. And there was a huge amount of paperwork. And since John and I in particular were affected, we stayed out of it. So, each company, the private company, and the public company, created independent board committees, each of whom hired lawyers, and each of whom hired independent investment banks for various opinions. And then, and then it was a pretty friendly negotiation, because it was pretty easy to understand the license agreement. The license agreement has been filed publicly since 2013.

KH: How many pages was that document?

Dan Legault: Oh, yeah, not like the registration. But in any event, a long involved legal process, but a rather mundane one, and then the, you have to have shareholder agreements, and you have to have shareholder meetings, and that sort of thing. But in any event, it finally closed last week, which we’re, which we’re thrilled about.

DL: You know, if I had just come across that news and didn’t have this interview, and was talking about it on the podcast, I would be saying, look at this fantastic news. If the guys running this company are unifying their IP into one package, they expect big things on the horizon. Do you think that’s a fair assessment?

Dan Legault: Well, we do expect big things. There’s always risk, of course. And that is precisely why we did it. That’s precisely why we did it, because we’re at the stage now where we’re in dialogue. Now so you know, we started working on the amalgamation two years ago, and we’re glad it’s finished, because it’s a lot of legal work. But because it does, it does make us more valuable, in our view.

KH: I would think so. One quick question, going back to the Nuance deal, I guess, maybe not quick. This was one of my main concerns, when I look at stocks that aren’t necessarily like big names, when they’re traded over-the-counter, or not really all that well known, not bringing in revenue yet. With regards to that Nuance deal, does that alleviate any concerns of equity raises through stock issuances in the near term? One thing that I am always on the lookout is a company thats main source of income is by issuing stock. And it looks like you guys have not done that in a while. With the 20 million that you receive from Nuance, I would assume that that wouldn’t be that much of a concern going forward.

Dan Legault: Well, let me correct you on one important fact. A week after the Nuance deal, we did raise money. It was offered to us by one of the large large investment banks, and it was a, what’s called a bought deal, so no, and at a lovely price.

KH: That’s right, I did see that.

Dan Legault: Yeah, at a lovely price, and no that’s risk to us. And so, we, so those two deals, in the course of a week in February, together gave us really nice capitalization, and put us in a much much stronger position, so you know, now we can march forward (inaudible) to fully negotiate to partner off our drug, and not get pushed around. Because the main way that they push you around, is by thinking you don’t have enough money to continue on your own, and we clearly do.

KH: Right.

Dan Legault: So yeah, there are no financing, there’s no liquidity concerns, and there’s, but there’s also no dilution concerns going forward, and no financing is contemplated going forward. Though I would say one thing, I mean retail investors, you know, hate dilution. I hate dilution. We all hate dilution.

KH: Right.

Dan Legault: But so, the main form of weakness in a biotech company is not having enough money, not the other way around. That’s how they don’t make it. So, I would caution against the knee-jerk reaction that oh, gosh, that’s more dilution. It’s, I don’t like being diluted because I have, but I like having, biotech, I like having a strong balance sheet. Bio takes a huge amount of money to be able to move forward, and you also need to be able to move forward, if you’re going to partner a drug.

KH: Right. I agree with you 100 percent. I just get nervous when I see a company that does that, you know, every quarter, or every six months they’re issuing another, yeah. Which I, looking through the financials, I don’t see that with Antibe.

Dan Legault: We had over $100 million of demand, mostly American, for the 40 that we go, I’m thinking in Canadian dollars, for the 40 Canadian that we took in February, we had over 100 million demand. And obviously the investment bankers are saying take more, take more, because they get a bigger commission. But we thought that that was an appropriate and prudent amount, and we’re thrilled that we did that. We look back and we’re pleased that we made that decision last February.

KH: Uh huh. We’ve got one more listener question that I want to get through, because it actually kind of leads in kind of nicely, that seems like. He says that you’ve recently stated that Antibe has been well received with institutional investors, but there’s not been any evidence of those groups buying yet, as far as like 13F filings, or just the volume in general on that stock. He wants to know if those institutions are waiting for anything specific, or if there’s been any progress in getting more Canadian institutions to invest? It looked like you have a conference coming up too, that looks like it’s kind of geared towards that, Wednesday, I think I saw.

Dan Legault: Well, that’s just, yeah, we just like constantly talking to investors. But it’s a good question. I mean, well, first of all, you know, the United States is 10 times the population of Canada, but it’s about 50 times the financing. You know, it’s the capital market strength, it’s unbelievable. There are about 3,000 US institutional investors who will invest in small cap Biotech. There’s a handful in Canada. There’s a great article in our national newspaper last summer talking about this exact problem. It’s a real problem. And most of the institutions who do invest in small cap Biotech in Canada, most of them are shareholders of ours. And if you talk to these institutions in the United States, there’s not very many, if you talk to these institutions in the United States, many, many of them won’t invest in OTC stock, or they won’t invest in a foreign company or a non-NASDAQ stock. That is the number one thing holding us back. And we’re planning on going on NASDAQ, we haven’t, you know, the financing we did in February gave us the strength to calmly go on NASDAQ, which we think is fine, and we’re just waiting for the, for the opportune time. We want to more or less line it up with the start of our Phase IIIs.

KH: You just answered another question on my list.

Dan Legault: (Inaudible) is yeah, always on the front of our radar screen. W we have a very good, very good reception from the sell side in New York, you know, the investment banks. They would love to take us onto the NASDAQ, and we want to do it in a calm, strategic way. And you can’t rush on to NASDAQ because you’re struggling to trade well, often afterwards. It’s, demands a more serious environment than Canada. And so, we’re now in a strong position to do that. And we’re going to do it calmly. And, as I mentioned, more or less time it to the beginning of our Phase IIIs.

KH: Are there any hurdles standing in our way, as far as up listing?

Dan Legault: No, we have the support of the community there. And so, it’s, it’s a question of strategy, and timing.

DL: It’s just a timing thing, right?

Dan Legault: Yeah, it’s a timing thing. You know, we don’t want it so soon after raising money. And you know, and you don’t do anything in, well, certainly Canadians don’t do anything in the summertime.

KH: I think we got through all my questions and all the Stocktwits questions. Dan, do you have anything else you want to ask?

DL: There was another question from Stocktwits that is of a different caliber, I think. Someone, MH5555 or was it you Kyle, that?

KH: Yeah, no, he asked like six questions, I was…

DL: Why were the BioPub interviews taken down? I’m assuming these were some good interviews you guys did?

KH: Oh, yes, that was my question, actually. Thank you for finding that.

DL: Okay. Well, there you go. That’s a question from my co-host, Kyle.

KH: Yeah, several of the users on Stocktwits have commented on that being a fantastic interview, and actually listened to them several different times.

Dan Legault: When Mark Swaim interviewed, Dr. KSS, as he’s called, interviewed me, you mean? Is that what you’re talking about?

KH: I think so. I, we couldn’t find it because they’ve been gone.

Dan Legault: Well, I don’t know. I don’t know.

DL: I’m assuming this is news to you, Dan.

KH: It sounds like it.

Dan Legault: It’s news to me. I don’t, I mean, I love Dr. KSS, I interact with them every few months. I didn’t know that they’re no longer there. They, I received a lot of nice comments about it. But in one of them, I was at my farm, and it was live. It was live on video, on a Zoom thing, and it was a fireside chat. And my golden retriever, my dog came up and, right into the frame of the camera, and nudged me too pat him. It was great, it was a great moment. I don’t know, I’m sure, I’m sure I can get a copy for you.

KH: That’d be great. I want to close things out, Dan, if you’ve got nothing else, with just a message from user Serendipity on Stocktwits, if that’s all right.

DL: Yeah, go ahead.

KH: All right, this is a response to the amazing questions that they had written. This said, the bottom line is that many of today’s retail investors are very savvy and intelligent, they’re hungry for information, and they want to be engaged in what’s going on in the companies they invest in. They are doctors, scientists, dentists, and many other professionals invested in Antibe, and most would like more than once or two, once or twice a year to see a CEO update or random PR. Antibe has such a great story to share, and these next generation anti-inflammatory analgesic medications being developed, could soon be household names everyone is using and talking about like Tylenol, Advil, and Aleve today. That’s why I’m excited about your interview with Dan, and why replayed those three BioPub interviews dozens of times. To me, it’s more than just the financial ROI. I’m actually part of a company that has the potential to impact people all over the globe, including myself and my family. So again, looking forward to listening to your conversation. Those are the types of investors you have, and I just wanted to share that with you.

Dan Legault: Well, I appreciate that. And we love those types of investors. And you know, and the more they want to know, and the more, the harder the questions, I mean, I just think that’s great. I mean, and I’m gonna think about that. I mean, we were we’re nice non-promotional Canadians. We don’t, we don’t want, we don’t manufacture news, we don’t put out a press release, unless we have something. But I’ll think about maybe more. But we do a lot of strategy, we have a lot of work going on at the moment, it doesn’t cost very much, but this early candidate development in a number of things that I was talking about. So, I’ll talk to my colleagues, and we’ll brainstorm. Perhaps we’ll put out you know, like a letter from me, like we call it a CEO letter. We’re talking about corporate, talking about corporate updates more often than we do. I’ll take that to heart, and really think about it.

KH: Oh, that’d be great, yes. And you’re always welcome to come back here, if you’ve ever got anything new to share.

Dan Legault: Oh, that would be a pleasure. This has been very enjoyable.

KH: The pleasure is all on this side. I was gonna play a game with you, we usually do one with our guests, but I don’t know if a CEO wants to play better with alcohol, where I name different drugs. So, I think we’ll just skip that.

Dan Legault: Well, next time. I’ll look forward to that.

DL: Is Dr. Wallace working on any party drugs at the moment? Or is it all just beneficial to mankind drugs?

Dan Legault: He’s a bit of a party pooper. It’s only beneficial to mankind drugs.

DL: All right. Well, that was my last question, Kyle. I got nothing else.

KH: I’ve got nothing else either. Thank you so much for joining us, Dan.

Dan Legault: You’re very welcome. Bye now.

DL: Take care. We’ve got to close up the china shop here, folks. I hope you’ve had a great time. It’s just been such a blast having Dan Legault:  here from Antibe. Really informative stuff. I’m excited about what that company has going in the future. I don’t know about Kyle here, but.

KH: I’ve loaded up the stock ticker on my TD Ameritrade. I’m getting ready to buy shares as we speak.

DL: If Ameritrade let me buy shares over-the-counter after hours, I would have, I would have to say during the course of this interview, I became a shareholder.

KH: Yeah.

DL: But anyway, we’re gonna, we got to wrap up the interview. We hope you come back and join us soon, this Saturday, for our next exciting episode. We got a lot more interviews coming up this month as well. But until then, happy trades.

KH: Bye folks.

KH: Thanks for joining us, you can find us off-air at That’s the number, Make sure you check us out. Download us on any streaming network. You know what to do.

DL: 2 Bulls in a China Shop is an entertainment program, and all thoughts and opinions expressed in the show belong to the hosts, and not of any company. They’re not intended to provide specific advice or recommendations for any individual, or on any specific security or investment product. It is only intended to provide entertainment about stocks, and the financial industry of trading. If you make trades based on what you hear in the show, you assume all risks for those trades.

About Dan Legault

Trained as a corporate lawyer and as an air force rescue pilot, Dan’s career has evolved to focus on high-growth, mostly technology-based companies. His CEO-level experience includes organizations specializing in data analytics, IT and consumer marketing.

He has served on the boards of directors of International Save the Children and of Green Shield Canada, a leading health benefits administrator. Dan continues to serve as a board member and advisor to several companies and not-for-profit organizations.

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