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PROFILE REPORT 2016

www.nexusbiopharma.com

| OTC:NEXS |

MicroCap MarketPlaceInside the New Technology RevolutionMike Casson, Editor, MicroCap MarketPlace

September, 2016

STOCK INFO

ACTION ALERT

FACTS SHEET

Nexus BioPharma, Inc. (NEXS:OTC) is an exciting and innovative biotech company, now deep in the discovery and screening stage of a weight loss and type-2 diabetes medication that could dramatically change the way doctors treat both.

HIGHLIGHTS

74.1 Percent

The percentage of Americans considered overweight or obese.1

108 Million

The number of people on diets in the United States. Dieters typically make four to five attempts per year.2

$64 Billion

Size of the US weight loss market in 2014.3

29.1 Million

The number of diabetics in the US.4

86 Million

The number of prediabetic adults in the US.5

1.4 Million

The number of new US diabetes diagnoses each year.6

234,051

Annual US deaths caused or contributed to by diabetes.7

$176 Billion

Direct medical costs of diabetes in US.8Nexus Biopharma, Inc.8 HillSide Ave, Montclair NJ

07042, USA

Investor Relations ContactLara Cely

[email protected]

(973) 524-6100

CONTACT INFO

INDUSTRY BioMed

EXCHANGE OTC

RECENT PRICE (SEPT. 14TH) $0.51

SHARES OUTSTANDING (8-K JUNE 10TH)

64.30M

FISCAL YEAR ENDS Dec. 31st.

ENTRY PRICE Buy up to $4.86/share

PROJECTION Near-Term Target $9.73/share

OPTIMUM PROFIT TARGET In excess of 500%

SYMBOL NEXS

STOCK SYMBOL : OTC-NEXSN

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OVERVIEW

Nexus BioPharma is an exciting and innovative biotech company, now deep in the discovery and screening stage of a weight loss and type-2 diabetes medication that could dramatically change the way doctors treat both. The experimental Nexus drug works profoundly

differently from other diet pills9, and the results seen in animal testing are simply transformational.10

Nexus BioPharma’s patent pending approach works by turning on the same metabolic pathways in the body that are activated by intense physical exercise. The animal subjects experienced the benefits of exercise as well.11 They lost belly fat, kept their lean muscle mass, burned calories faster, increased insulin sensitivity, improved triglyceride levels, and even lowered their cholesterol.

What’s even more exciting is that the pathways the Nexus BioPharma have activated in mice work exactly the same way in human beings.12 If the investigational drug shows evidence of safety and efficacy in human trials, then it might well be the “magic pill” the whole world has been waiting for.

Saying the “whole world” is waiting for Nexus BioPharma’s drug is no exaggeration. The World Health Organization (WHO) estimates that 1.9 billion people on earth are overweight or obese.13 If you think that sounds alarming, the statistics for the US are especially shocking. According to the National Institutes of Health, “More than two-thirds of adults and almost one-third of children and adolescents in the United States are overweight or obese.”14 Drilling down into those numbers, the Centers for Disease Control says that nearly 78.6 million adults15 and nearly 13 million children16

meet the clinical definition of obesity, which is having a body mass index (BMI) of 30 or greater.

The Challenge:

“If the investigational drug shows evidence of safety and efficacy in human trials, then it might well be the “magic pill” the whole world has been waiting for.”


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This is far more than a mere cosmetic or lifestyle problem: the obesity epidemic in the US is a healthcare nightmare. Obesity is linked to serious health conditions, including adult onset (type-2) diabetes, stroke, heart disease, and certain cancers. Obesity is such a major issue that close to 200,000 people will undergo some form of bariatric surgery this year, hoping to change their futures.17

Considering data like this, it should come as no surprise that nearly half of overweight and more than two thirds of obese Americans are actively trying to lose weight. In 2016, industry watchers expect Americans to spend more than $40 billion on weight loss products.18 More than $2 billion will be spent on “diet pills,” weight loss supplements in the form of tablets or capsules.19

The problem is, these supplements do not work.20 The bigger problem is that cutting calories and increasing exercise don’t work for obese people either.21 Scientists have discovered that obesity changes the way the body functions, making it almost impossible to keep weight off.

According to the world-renowned UK medical journal, The Lancet, as many as 95% of obese people who lose weight gain it back:

Dr. Christopher Ochner, assistant professor of pediatrics and psychiatry at the Icahn School of Medicine in New York and lead author of the paper, said . . .“Few individuals ever truly recover from obesity; rather they suffer from ‘obesity in remission’ . . . They are biologically very different from individuals of the same age, sex, and bodyweight who never had obesity.” Measures that can reverse obesity-induced changes to the body’s biology will be needed to treat [these] patients.” 22

1960-72

20

30

40

50

10

10,712,1 12,7

20,5

27,728,3

31,732,5 33,8

35,9

50

2001-021971-74 2003-041976-80 2005-061988-94 2007-081999-2000 2009-10 Projected 2030

Prevalence of Obesity Among U.S. Adults Aged 20-74

% Obesity

Source: Derived from NHANES data


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A MAGIC BULLET FOR WEIGHT LOSS?

What people around the world have been looking for is the proverbial “magic bullet” for weight loss: a drug that will let them lose weight while eating normally.

Just imagine for a moment the consumer demand for a safe and effective, FDA approved weight loss drug that actually worked. Imagine the demand for a drug that would flip a switch in our cells, turning our bodies into fat burning machines, a drug that could give us the metabolism of professional athletes – without spending hours in the gym or eating only egg whites and steamed vegetables.

Nexus BioPharma is doing more than imagining it: they are making it happen.

Don’t stop reading. An exercise pill is not an impossibility. In fact, recent science shows it is very much possible. On October 2, 2015, the Daily Mail posted an article with this headline: “How ‘exercise in a bottle’ may soon be a reality: Scientists map 1,000 changes that physical activity causes in the body to create drugs that have the same effects.”23

The science is real, and the scientific breakthrough that Nexus BioPharma’s experimental drug is based on has already shown itself to be effective in animal testing.24 In fact, other drugs (not developed for weight loss per se) have also demonstrated that Nexus BioPharma’s underlying technology works in humans25—we will go into the science in greater depth later in this report. But for now, suffice it to say that Nexus Biopharma’s proprietary and patent-pending technology could in fact become that magic bullet the world has been waiting for, and it could not come at a better time. Studies have shown a tremendous increase (70% over 10 years) in people with a BMI of over 40 and an even greater number for those with a BMI of more than 50—considered morbidly obese.26

An exercise pill is not an impossibility:

“How ‘exercise in a bottle’ may soon be a reality: Scientists map 1,000 changes that physical activity causes in the body to create drugs that have the same effects” 23

–Daily Mail, October 2nd, 2015

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The obesity crisis has led to a worldwide type 2 diabetes crisis. Nearly 16 million Americans have a BMI greater than 40.27 The number of diabetics tops 29 million. Of course, diabetes does not respect borders. It is a growing global problem. The WHO estimates that 422 million people around the world have diabetes.28 In the US alone, the direct medical cost of treating diabetes is $176 Billion.29 If Nexus BioPharma’s new drug proves safe and effective in human trials (which could begin as soon as 2018), then investors could see a meteoric—perhaps unprecedented—rise in the company’s value. They might also see major pharmaceutical companies lining up for a chance to commercialize it.

Whether Nexus BioPharma chooses to sell, partner with a major pharmaceutical company, or bring the drug to commercialization itself, the revenue possibilities are truly exciting. If just 5 percent of diabetic patients take the drug at an arbitrary cost of $3 per day, the result is more than $1.5 billion in sales. As big as that number is, it might be an underestimate of the potential. If the drug has the same effects on human weight loss as it has in animals, we think it could capture market share in a way unseen by any other pharmaceutical breakthrough since Viagra.

Let’s examine Nexus BioPharma’s key intellectual property and see how profoundly different its drug technology is from any other competing weight loss drug or supplement.

“1 in 5 healthcare dollars spent in the U.S. goes to care for people with diabetes.”

–American Diabetes Association


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KEY INTELLECTUAL PROPERTY

Nexus BioPharma was founded to develop safe, effective weight loss drugs using an entirely new and extremely exciting approach—what the pharmaceutical industry calls “mechanism of action.” At present, all FDA approved weight loss drugs—and there are very few,

considering the size of the market—rely on one (or some combination) of three approaches: curbing appetite, creating a feeling of fullness, or interfering with the way the intestines absorb fat. The reason these products are not flying off the shelf, so to speak, is that the results have been underwhelming. At root, they all depend on dieters changing their behavior. Moreover, even these FDA approved drugs have very unpleasant and even dangerous side effects.30

Nexus BioPharma’s developmental weight loss and type 2 diabetes drug works in a fundamentally different way. Instead of relying on behavior modification, Nexus relies on metabolic modification. The Nexus drug activates the same pathways in the body that are naturally activated by intense physical exercise.31 That pathway is called the AMP-activated protein kinase (AMPK). Simply put, the AMPK pathway regulates how energy is used in the cells of every living thing, from single cell organisms, to mice, to people.

What is that energy? It’s a compound called adenosine triphosphate (ATP). When we eat, our food is converted to glucose, which enables the production of ATP, the energy that our cells use to function. Our bodies are constantly synthesizing ATP.32 When we exercise, the AMPK pathway is activated, which causes our cells to burn more energy.33

To change our metabolism naturally in such a way requires an intensive aerobic and resistance strength-training regime. The effort results in high aerobic efficiency and increased lean muscle mass in the body. The fact that exercise activates AMPK (at least in heathy people—obesity also affects metabolism, more on which later) has been well known for decades.34

The Science:

“The Nexus drug activates the same pathways in the body that are naturally activated by intense physical exercise. That pathway is called the AMP-activated protein kinase (AMPK).”

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The scientific breakthrough that makes the Nexus drug so promising happened in the lab of Jeffrey Pessin, Ph.D., the Judy R. and Alfred A. Rosenberg Professorial Chair in Diabetes Research and Director of the Diabetes Research Center at Albert Einstein College of Medicine. What is this breakthrough? Dr. Pessin discovered how to flip the metabolic switch and activate the AMPK pathway pharmacologically.35

Let me say that again: Dr. Pessin’s discovery, awaiting patent protection, is a pharmacological means of activating this amazing metabolic pathway. This discovery forms the basis of Nexus BioPharma’s technology license.36

Specifically, Dr. Pessin and his team discovered that suppressing Fyn kinase (a protein implicated in the control of cell growth37) indirectly activates AMPK. The key confirmation that Fyn is responsible for the activation was reported in the journal Cell Metabolism (Yamada, et al., Volume 11, Issue 2, p113–124, 3 February 2010) Just like AMPK, Fyn performs the same function in animal cells as it does in human cells.

By suppressing Fyn, and therefore activating AMPK pathways, mice lost fat without losing muscle. And that’s not all: over and above losing weight, the mice saw a range of other benefits, including increased metabolism, increased insulin sensitivity (very important in the treatment of diabetes), improved triglyceride levels, and even lower cholesterol.38

Again, if this sounds too good to be true, take a moment and remember that exercise does all of those things as well. Unless you are an athlete—or you keep yourself in top physical condition like an athlete does—you have almost certainly had a physician tell you to get more exercise. That’s because regular exercise (and preferably intense exercise) is a negative risk factor for all sorts of health issues, from diabetes and heart disease to certain cancers and neuro-degenerative diseases.

“If Nexus really has found the technology that will create ‘exercise in a bottle,’ we would expect the drug to produce the same benefits as exercise.”


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Far from making us skeptical of Nexus BioPharma’s claims, these collateral benefits increase our belief that they are on the right track. If Nexus really has found the technology that will create an “exercise” pill, we would expect the drug to produce the same benefits as exercise.

As you read on, keep Fyn and AMPK in mind. The manner in which the Nexus drug affects them are not only what makes it so effective in animal studies, but other drug trials have already shown that manipulating them is be safe and effective in humans.39 40

When the leadership of Nexus BioPharma was approached by Dr. Pessin’s team with these results, they saw the potential for developing a truly revolutionary diet drug. Building on Dr. Pessin’s key finding, Nexus BioPharma has been busily screening for compounds that can selectively and non-toxically activate the AMPK pathway. This work has resulted in their filing to protect their own intellectual property, namely large numbers of chemical entities, representing eight chemical backbone families, for weight loss, increased exercise tolerance, and more.

MORE THAN WEIGHT LOSS

We all know people who can seemingly eat whatever they want without gaining weight. We’ve also all probably heard that some people just have a “faster metabolism” than others. There may be more truth to that than we realize. People who are dedicated to a

lifestyle of training—spending hours a day working hard in the gym or logging huge numbers of miles running or massive numbers of laps in the pool (and maybe all three), tend not to be obese or even overweight. As we now know, under the stress of an intense workout, the body activates AMPK pathways and boosts the metabolism. Increasing lean muscle mass and aerobic efficiency keep those pathways active even at rest.


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Obese people tend to experience the opposite. Even when they cut calories and begin to exercise, they tend not to lose weight, and sometimes even gain weight. Their cells go into the mode of trying to preserve stores of energy. As Dr. Rachel Batterham, head of University College London Hospital’s Centre for Weight Loss, explains: “Once people have become overweight, then biology changes” and “wants them to return to the maximum weight they had achieved.”41

A further problem that keeps obese people obese is an intolerance of exercise. To achieve the metabolic changes that athletes experience requires a level of exercise many overweight folks just cannot do. It is a vicious circle.

It is no wonder then that so many millions of struggling people turn to over-the-counter weight loss supplements and prescription diet drugs.

Obesity is a vicious circle:

“Exercise is the most powerful therapy for many human diseases, including type 2 diabetes, cardiovascular disease and neurological disorders. . . However, for many people, exercise isn’t a viable treatment option. This means it is essential we find ways of developing drugs that mimic the benefits of exercise.” 42

–Professor David James, Australian researcher, University of Sydney.

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SURVEY: At this time are your seriously trying to lose weight?

% Yes

Source: GALLUP - Based on national adults

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SUPPLEMENTS DON’T WORK AND MIGHT KILL

YOU

Millions of people are spending hundreds of millions of dollars on weight loss products that do not work. It is important to note at this

point that there is a difference between weight loss products—like supplements, energy shots and diet drinks—and FDA approved drugs for weight loss (only one of which is currently available over the counter). There are significant problems with both, yet sales seem to grow as fast as the average American waistline.

A recent study published in the International Journal of Sport Nutrition and Exercise Metabolism confirms what millions of hopeful, yet disappointed, consumers already know: commercial weight loss supplements just don’t work. Oregon State University researcher, Dr. Melinda Manore, investigated hundreds of weight loss supplements, a $2.4 billion industry, and found that “no research evidence exists that any single product results in significant weight loss – and many have detrimental health benefits.”43 Manore is a very credible voice. Not only is she a professor of nutrition and exercise sciences at OSU, she was also a member of the Science Board for the President’s Council on Fitness, Sports and Nutrition. Her academic career is focused on the effect of nutrition and exercise on health and performance.

Manore examined data for supplements in four categories: products that claim to block absorption of fat or carbohydrates, increase metabolism, change body chemistry, and suppress appetite. Most of the products showed less than a two-pound weight loss benefit.44

Consumer Reports makes no bones about the advice they give regarding supplements: “Don’t waste your money.”46 They might have also said, “Don’t risk your life.” That’s what Interpol has done with regard to one especially powerful, especially dangerous supplement known as DNP. This supplement falls into the category of metabolism enhancer, and it is deadly. On April 23, 2015, Interpol issued an Orange Warning, alerting 190 countries of “a serious and imminent threat to public safety” posed by the supplement.47 Ten days before, in the UK, 21 year old Eloise Aimee Parry died after taking the supplement. She was the sixth British fatality associated with DNP.

“What people want is to lose weight and maintain or increase lean tissue mass. There is no evidence that any one supplement does this. And some have side effects ranging from the unpleasant, such as bloating and gas, to very serious issues such as strokes and heart problems.” 45

– Melinda Manore, PhD. Oregon State University

National Collaborative on Childhood Obesity Research (NCCOR)


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The tragedy of Ms. Parry’s death threw the spotlight on the dangers and ineffectiveness of weight loss supplements in the British media. Dr. Sally Norton, British weight-loss expert and consultant surgeon, wrote an impassioned piece in the Daily Mail:

The current obesity crisis is threatening to cripple the NHS (Britain’s National Health Service) due to the costs of treating obesity-related disease. If there was a drug that effectively and safely helped people lose weight, do you think the NHS would be keeping it a secret? A diet-pill that actually works is the ‘holy grail’ of medicine that everyone is searching for. There is currently only one drug that is prescribed specifically for weight-loss in the UK -- the other was withdrawn due to the risk of side-effects.48

We think she is absolutely correct: a clinically effective, safe drug that actually caused people to have the fat burning metabolism of an athlete in training would be like finding, as she put it, the “holy grail” of medicine. The drugs in current use certainly do not qualify.

PRESCRIPTION DIET PILLS DON’T WORK WELL EITHER

The drug Dr. Norton mentions is orlistat, and it is one of five FDA cleared weight loss medications available by prescription in the US. Interestingly, only two of them were developed specifically for weight loss. None has shown dramatic effects, and all have very

unpleasant and potentially deadly side effects of their own.49 In every case, the pharmaceutical is prescribed as part of a larger weight loss regimen, including changing eating habits.50 (The fact that the Nexus drug may work without requiring the dieter to change eating or exercise habits makes it especially attractive.) According to the Endocrine Society’s 2015 guidelines, these five pharmaceuticals are appropriate only for people with a BMI of 30 or higher (considered obese) and those with both a BMI of at least 27, and with health conditions caused by the excess weight.51

The most famous prescription drug (and the first drug developed and approved to specifically treat obesity) is orlistat. It has been on the market as a prescription drug since 1999, and in 2007 it was approved for over the counter sales in a weaker form. In both of its forms — over-the-counter (as Alli) and prescription (as Xenical) — orlistat is a lipase inhibitor. It works by blocking the ability to digest and absorb dietary fat. The fat that is not digested or absorbed is excreted, which leads to embarrassing side effects including gassiness, oily bowel movements, and involuntary defecation. That might be acceptable to more people if the results were more remarkable. The Mayo Clinic released a study in 2014 that reported: “People who ate a calorie-restricted diet, exercised regularly and took Alli lost an average of 5.5 pounds more in one year than did people who only dieted and exercised.”52 Orlistat—the best of a bad bunch of options—has also been linked to liver failure (requiring a transplant) and even death.53


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Next is lorcaserin, sold under the brand name Belviq. It was the first weight loss drug to be approved since orlistat, and this approval came 13 years later, in 2012. (Clearly, if Nexus can establish safety and efficacy, there is a ready market for its innovation—but more on this later). Unlike orlistat, locaserin works on the brain, not the intestines. It acts on serotonin receptors in the brain to create a feeling of fullness, so people eat less. Here again, the results are real, but not particularly remarkable. According to the FDA’s release describing the clinical trials: “All participants received lifestyle modification that consisted of a reduced calorie diet and exercise counseling. Compared with a placebo, treatment with Belviq for up to one year was associated with average weight loss ranging from 3 percent to 3.7 percent.”54 In other words, those on the drug lost about six pounds more than those who took a placebo. Less than half of the people on the drug lost a clinically significant amount of weight. According to the FDA, clinical trial participants also had trouble staying on the drug, as they were experiencing headaches, dizziness, fatigue, nausea, constipation, memory and attention problems and a leaky heart valve.55

The combination of phentermine and topiramate is marketed as Qsymia. It combines two existing drugs: phentermine, an appetite-suppressing stimulant, and topiramate, an anti-seizure medication developed to treat epilepsy, but that also makes people feel fuller after they eat.56 In clinical trials, Qsymia led to more weight loss than the other medications,57 but its side effects were so severe that nearly 40 percent of clinical trial participants stopped taking it.58 In fact, safety concerns kept the FDA from approving it on the first attempt in 2010.59 In addition to memory lapses, speech problems, anxiety, and depression leading to suicidal thoughts, “This drug may rarely cause serious (sometimes fatal) lung or heart problems (pulmonary hypertension, heart valve problems).”60

Contrave is another combination of existing drugs, in this case the addiction medication naltrexone and bupropion, an antidepressant. Nondiabetic patients lost 4.1 percent more weight than those who took a placebo in a clinical trial. Patients with type 2 diabetes showed less weight loss—just 2 percent more than those on the placebo.61 Its minor side effects include nausea, constipation, headache, vomiting, dizziness, insomnia, dry mouth and diarrhea. As the Washington Post reported, “More troubling, the drug may cause seizures. And because it contains bupropion, it must carry a boxed warning saying that it may increase suicidal thoughts and behavior. The FDA is concerned about the medication’s effect on the heart and is requiring more studies.”62


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Liraglutide was first approved for the treatment of type 2 diabetes, as it helps promote insulin production. In December 2014, the FDA expanded the use of a higher dose of liraglutide for the treatment of obesity. Sold under the brand name Saxenda, it is taken daily as shot. The FDA approved it with the requirement that the manufacturer inform doctors about the serious risks associated with the drug.63 It also carries what’s known as a “black box warning,” reserved for prescription drugs that pose a significant risk of serious or life-threatening adverse effects. During animal testing, the drug caused cancerous thyroid tumors in rodents, but the cancer risk to humans is unknown, and more studies are ongoing to determine long-term safety.64

WHY WE ARE CONFIDENT THE NEXUS DRUG WILL WORK

Nexus BioPharma’s breakthrough has had remarkable results in mice. If you’ve read this far into the report, you probably have some interest in and familiarity with pharmaceutical development. If so, you are probably aware that some compounds that are very promising

in mice end up not working well in humans. We expect to see the animal results replicated in humans because third party data demonstrates that the AMPK pathway works extremely well in humans. As early as 2011, researchers at the Boston, MA based and Harvard Medical School affiliated Joslin Diabetes Center proved that AMPK is activated by exercise and “has an important role in metabolic regulation in many types of cells throughout the body, including muscle, heart and fat cells.”65

Three drugs—two that made it to late phase human trials and one that is very well established— show that the two key technologies underlying Nexus BioPharma’s experimental drug are both safe and effective. The experimental drugs are beloranib, an injectable anti-obesity drug under development by Zafgen (NASDAQ: ZFGN) and saracatinib, an anti-cancer drug that was being developed by global pharma giant AstraZeneca (NYSE: ANZ). The third drug is metformin—one of the most commonly prescribed type 2 diabetes medications.66 Metformin has been FDA approved for more than 20 years, and has been in use in Canada and Europe for far longer than that. It is sold under a number of brand names. We will start there.

AMPK is activated by exercise and...

“...has an important role in metabolic regulation in many types of cells throughout the body, including muscle, heart and fat cells.”

–Joslin Diabetes Center Boston, MA based and Harvard Medical School affiliated institute.

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Laurie Goodyear, PhD., Head of the Section on Integrative Physiology and Metabolism at the Joslin Diabetes Center and an Associate Professor in Medicine at Harvard Medical School, is one of the researchers who uncovered the connection between metformin and AMPK. “[M]etformin, which is probably the number one diabetes drug in the world, works through th[e] AMPK mechanism that exercise activates.”67 Harvard Medical School describes the significance of Goodyear’s work this way: “These studies have contributed to worldwide interest in AMPK as a master regulator of metabolic and transcriptional functions in tissues and cells throughout the body. Furthermore, this work has led to intensive work in the pharmaceutical industry focused on the development of an AMPK activator as a novel drug target for the treatment of diabetes.”68

Zafgen’s controversial drug, beloranib, demonstrates that pharmaceutically activating the AMPK pathway results in dramatic weight loss and blood chemistry benefits in humans—mirroring what Nexus BioPharma’s research has demonstrated in mice. (Beloranib uses a different target protein to activate AMPK than Nexus BioPharma’s approach). Zafgen issued results from a phase 2 human trial in May of 2015:

Results from this trial showed that 12 weeks of treatment with beloranib led to sustained, progressive and dose-dependent weight loss of up to ~11kg from baseline. Additionally, beloranib treatment significantly reduced sense of hunger and prospective food intake, and known markers of beloranib response, including major cardiovascular risk factors and markers of inflammation, were also improved at 12 weeks. Significant reductions in total and LDL cholesterol and triglyceride levels and an increase in HDL cholesterol were noted in the beloranib 2.4mg group.70

“The success of metformin clearly demonstrates at least two things: that the activation of AMPK pathways is an effective mechanism of action for pharmaceuticals, and that activating AMPK is safe. Interestingly, a 2014 study published in Diabetes, Obesity and Metabolism, seems to indicate that type 2 diabetics on metformin actually live longer than healthy people.” 69


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Later in 2015, the FDA put a halt to trials after the death of two subjects who were taking Zafgen’s drug as a treatment for a rare genetic eating disorder called Prader-Willi syndrome. It is not clear yet what if any role the drug itself played in the deaths71 It is clear that increasing energy expenditure by activating AMPK had better weight loss results than any of the other approved weight loss drugs. Beloranib activates AMPK by inhibiting methionine aminopeptidase 2 (MetAP2 ).72

The inhibition of Fyn kinase is the patent-pending intellectual property developed at Albert Einstein College of Medicine’s Diabetes Research Center.

So the next logical question is: have Fyn kinase inhibitors been used safely on humans? The answer again is yes, and the proof is Saracatinib, an experimental drug under development by AstraZeneca. Saracatinib is a Fyn kinase inhibitor.73 The development was discontinued in Phase 2 human trials—not for safety concerns, but for lack of efficacy as a cancer drug. In fact, saracatinib is under investigation again, now at Yale University, this time to be repurposed as an Alzheimer’s treatment.74

When we put what we know together, the future looks promising for Nexus BioPharma. From the research we conclude that activating AMPK works to help people lose weight, and that inhibiting Fyn kinase is a safe means of activating AMPK.

According to the research:

After 20 years of study surrounding AMPK, science has uncovered just two enzymes that, when inhibited, activate the AMPK pathway: MetAP2 (used by Zafgen) and Fyn kinase, used by Nexus. The inhibition of Fyn kinase is the patent-pending intellectual property developed at Albert Einstein College of Medicine’s Diabetes Research Center.


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MARKET FOCUS: DIABETES

Nexus BioPharma’s compounds are being investigated as an anti-obesity and type2 diabetes treatment. If the drug is approved, the potential demand for its use in the treatment of type 2 diabetes alone could be staggering. (Although for investors, early

indications of safety and efficacy might be all they need to see huge returns.)

Worldwide, antidiabetic medicines were a $35.6 billion market in 2012, and industry analysts expect that figure to exceed $55 billion before 2020.75

On September 8, 2015, the Journal of the American Medical Association released an eye opening study. It found that nearly 50% of adults in the US were diabetic or prediabetic.76 By far, most of those people—up to 95 percent of them according to the National Institutes of Health77—have type 2 diabetes. According to the American Diabetes Association, “If you have type 2 diabetes, your body does not use insulin properly. This is called insulin resistance. At first, your pancreas makes extra insulin to make up for it. But, over time it isn’t able to keep up and can’t make enough insulin to keep your blood glucose at normal levels.”78 Left untreated, diabetes can have serious complications, including vision loss, limb amputation, kidney failure, stroke and more. Each year sees another 1.4 million Americans diagnosed with diabetes79, and each year diabetes is either the direct or contributing cause of death for another 230,000 Americans.80 Diabetes is a health and economic crisis—as the seventh leading cause of death in the United States, it accounts for $245 billion in medical costs and lost productivity each year.81

Considering the enormity of the problem, if Nexus BioPharma’s approach shows promise in human trials, it is possible that big pharma could approach them with very attractive buyout offers.


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THE NEXUS DEVELOPMENT PROCESS

Nexus BioPharma’s experimental drug’s screening phase is taking place in the UK, at BioFocus DPI, Ltd., a Charles River Laboratories subsidiary and a major Clinical Research Organization (CRO). The CRO is engaged in virtual screening, assay development

and optimization, compound selection and screening, and active-to-hit work to support hit identification of inhibitors of Fyn kinase.

Nexus has identified and filed for protection on a selection of molecules that will be investigated to determine their suitability for use in humans. The CRO is now working to optimize their selectivity, which is another way of saying to decrease potential side effects, without degrading the therapeutic benefit of the compound.

The FDA’s approval process is well known for its rigor. After an experimental compound’s safety and efficacy has been established in several animal species, Nexus BioPharma will file for investigational new drug (IND) review by the FDA. This will be followed by three phases of human clinical trials, with the pool of subjects increasing at each phase.

Nexus BioPharma expects to file for IND status by the end of 2016. On this timeline, human trials in the US could begin as early as 2018.82 But because we live in a global village these days, human trials in other jurisdictions could begin even sooner. We believe that once the first evidence of efficacy and safety hits the international press, Nexus BioPharma’s stock price could respond favorably, providing very attractive returns for early investors.

“Nexus BioPharma expects to be filing for IND status as soon as the end of 2016. On this timeline, human trials in the US could begin as soon as early 2018.”


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LEADERSHIP

Nexus BioPharma is led by Warren C. Lau, and when you read his background, you’ll see immediately why the Albert Einstein College of Medicine reached out to him to spearhead the development of their breakthrough.

Prior to serving as Nexus BioPharma, Inc.’s President, Chief Executive Officer and Director, a position he has held since the formation of the Company, Mr. Lau was a successful biotech entrepreneur and leading product development visionary many times over. From July 2009 to February 2015, Mr. Lau served as Founder, President and CEO, and Chief Financial Officer of MetaStat, Inc. (MTST-OTCBB). From October 2005 to March 2008, Mr. Lau served as a Director and as the Founder, President and CEO of HoustonPharma, Inc. Mr. Lau was the founder of PharmaFrontiers Corp., now Opexa Therapeutics, Inc. (OPXA-NASDAQ), in February 2003, and served as a member of the company’s Board of Directors and as its President, Chief Executive Officer and Treasurer until July of 2004. In 2004, PharmaFrontiers acquired Opexa Pharmaceuticals. Mr. Lau was the founder of Adventrx Pharmaceuticals, Inc., now Mast Therapeutics, Inc. (MSTX-NYSE MKT) in 1996. He served as its President and CEO and as a member of its Board of Directors from July 1996 through November 2001. During his time as President and CEO, the Company consummated two acquisitions, Immune Complex Corporation in 1997, which was later spun off to Shareholders and Biokeys Pharmaceuticals, Inc. From November 1997 to September 1998, Mr. Lau served as a director of Immune Complex Corporation and Synthetic Genetics, Inc., privately held biotechnology companies.83

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CONCLUSION

Nexus BioPharma (NEXS), from our perspective, has huge upside potential for early investors. The Company’s drug may not even have to be released for the early returns to start showing up… but when the first data indicating safety and efficacy in human trials is reported, we expect interest in the stock to

run off the charts.

Upon receiving approval, on a very conservative basis, and barring the appearance of serious competition, Nexus BioPharma’s revenues could trend above $1 billion. Considering the size of the market for diabetes drugs and the seriousness of the problems that diabetes creates, the potential revenues could far surpass that number.

Could the human trials disappoint? Certainly that is possible, but the positive results up to this point strongly suggest otherwise. If and when Nexus BioPharma shows signs of success in humans, not only will it provide hope for millions of obese and diabetes sufferers, it could also generously reward early investors in the Company.

NEXS could be the one bio-med stock you should consider adding to your small-cap portfolio sooner than later.

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Mike Casson has a 35 year history of successful investing and many of his recommendations have produced significang gains for early stage investors. Mr. Casson’s focus is primarily on micro-cap stocks; those with a market cap below $250 million. These stocks may have significant upside potential but given the nature of these companies and the lack of a long term trading market for their securities, investing in such companies is highly speculative and carries a high degree of risk. An investor in such securities should be preapred and able to bear a loss of his or her entire investment.

Mr. Casson received his BBA from Southern Methodist University in Dallas, Texas, where he also attended graduate school. He has held several securities licences and was a Registered Investment Advisor and equity partner in a privately owned FINRA member firm. Mr. Casson serves as the Publisher and Executive Editor or MicroCapMarketPlace.com, an independent paid circulation newsletter. Past results are not necessarily indicative of future performance.

Mike CassonPublisher & Executive Editor,

MicroCap MarketPlace

ABOUT THE EDITOR

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DISCLAIMER

NOTICEMike Casson and MicroCap MarketPlace (collectively, “Editor”) hereby certify that the views expressed in this Profile Report about Nexus BioPharma, Inc. are those of the Editor and that no part of Editor’s compensation was, is, or will be, directly or indirectly, related to any views expressed in this report.

DISCLAIMERThis Profile Report on Nexus BioPharma, Inc. (the “Company”) was prepared for informational purposes only. The Company has not endorsed this report or compensated Editor for the views expressed herein. Editor’s affiliate, Casson Communications LLC has been compensated in the amount of $8,000 by a third-party for this Profile Report. Neither Editor, nor its principals, associates, affiliates or employees own shares in the Company.

The information and statements herein have been obtained from sources considered reliable but we neither guarantee nor represent completeness or accuracy. Editor did not make an independent investigation or inquiry as to the accuracy of any information provided by the Company on its website, or other sources of publicly available information. Such information and the opinions expressed are subject to change without notice. This report is not intended to be an offering, recommendation, or a solicitation of an offer to buy or sell any securities mentioned or discussed.

This report does not take into account the investment objectives, financial situation, or particular needs of any particular person and does not provide all information material to an investor’s decision about whether or not to make any investment. Any discussion of risks in this report is not a disclosure of all risks or a complete discussion of the risks associated thereto. In general, given the nature of the company or companies profiled and the lack of a long term trading market for their securities, investing in such securities is highly speculative and carries a high degree of risk. An investor in such securities should be prepared and able to bear a loss of his or her entire investment.

Neither Editor nor its principals, employees or associates is registered as a securities broker-dealer or an investment adviser with FINRA, the U.S. Securities and Exchange Commission or with any state securities regulatory authority.

ALL INFORMATION IN THIS REPORT IS PROVIDED “AS IS” WITHOUT WARRANTIES, EXPRESSED OR IMPLIED, OR REPRESENTATIONS OF ANY KIND. TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, EDITOR WILL NOT BE LIABLE FOR THE QUALITY, ACCURACY, COMPLETENESS, RELIABILITY OR TIMELINESS OF THIS INFORMATION, OR FOR ANY DIRECT, INDIRECT, CONSEQUENTIAL, INCIDENTAL, SPECIAL OR PUNITIVE DAMAGES THAT MAY ARISE OUT OF THE USE OF THIS INFORMATION BY YOU OR ANYONE ELSE (INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, LOSS OF OPPORTUNITIES, TRADING LOSSES, AND DAMAGES THAT MAY RESULT FROM ANY INACCURACY OR INCOMPLETENESS OF THIS INFORMATION). TO THE FULLEST EXTENT PERMITTED BY LAW, EDITOR WILL NOT BE LIABLE TO YOU OR ANYONE ELSE UNDER ANY TORT, CONTRACT, NEGLIGENCE, STRICT LIABILITY, PRODUCTS LIABILITY, OR OTHER THEORY WITH RESPECT TO THIS PRESENTATION OF INFORMATION. PAST RESULTS ARE NOT NECESSARILY INDICATIVE OF FUTURE PERFORMANCE.

Reprinting, reproduction, or copying of this Profile Report or any material contained herein is strictly prohibited.

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