Weekend Update #68

Apr 1

Welcome to Blue Room's Weekend Update. Each week, we're sharing what companies we're researching and the what, the who and the how that we think makes the companies interesting and unique. This roundup is brought to you weekly by a group of interns, creative minds, artists and investors who believe that through best in class investing along with the democratization of financial education we can do great things together. Enjoy, Explore and Share.

The conflict between Ukraine and Russia continued to be the main focal point for markets, as on-and-off rumors of peace talks sent equity markets on a rollercoaster ride throughout the week. Russia announced Tuesday that it would dramatically reduce its military presence in Kyiv as peace talks between the two nations progressed. Some global political leaders doubt this retreat as a true step towards peace, and suspect it rather to be an attempt to reconvene Russian armed forces in order to resupply them. The conflict continues to cause volatility in sections of commodities markets, raising global inflation concerns. Rate markets were quick to react after United States Fed Chair, Jerome Powell signaled that the Fed would be considering a 0.50% increase in rates in any one meeting to curb inflation this year. The yield curve that measures the spread between 2-year and 10-year notes inverted on Friday. This is a sign that markets may be pricing in a possible recession. Quarterly GDP, annualized, suggested continued strength, however, so there may still be a chance the Fed can prevent a slowdown.
GEOPOLITICS

El Salvador declared a state of emergency following the wave of gang-related killings. Constitutional rights have been suspended and heightened military presence has been deployed. (Sunday)
News was released that Ukrainian peace negotiators and Russian oligarch Roman Abramovich suffered symptoms inline with those of poisoning after a meeting on March 3rd in Kyiv. (Monday)
United States President, Joe Biden announced that the country will release 1 million barrels per day of oil reserves to combat supply shortages and high gas prices. (Thursday)

MAJOR INDICES

S&P 500 - Finished up slightly, +6 bps

Index Leaders: (TSLA) up +7.32%, (MSFT) up +1.89%, (V) up + 3.63%, (MA) up +4.28%, (ADBE) up +6.16%.
Index Laggards: (NVDA) down -3.54%, (BAC) down 6.47%, (JPM) down 4.66%, (AMD) down -9.59%, (INTC) down 7.18%.

Nasdaq - Finished up, +66 bps

Index Leaders: (TSLA) up +7.32%, (MSFT) +1.89%, (ADBE) +6.16%, (COST) up +3.57%, (TMUS) up +5.21%
Index Laggards: (NVDA) down -3.54%, (AMD) down -9.59%, (INTC) down 7.18%, (QCOM) down -6.95%, (AMZN) down -0.74%.

DJIA - Finished down, -13 bps

Index Leaders: (V) up +3.63%, (MCD) up +3.17%, (WMT) up +5.27%, (MSFT) up +1.89%, (AMGN) +1.81%.
Index Laggards: (HD) down -2.83%, (GS) down -2.15%, (JPM) down -4.66%, (CVX) down -3.01%, (INTC) down -7.18%.

Thank you Blue Room Team Member NICK PEART.

Investment Thesis

Team 81 full-time employees

42 R&D program including Digital Therapeutics

18 contractors & consultants

Technology

EntheogeniX Biosciences — AI-enabled computational biophysicsplatform designed to optimize and accelerate drug discovery

Introspect Digital Therapeutics — digital therapeutics platform dedicated to improving patient outcomes through personalized care

InnarisBIo — a formulation technology company developing a sol-gel based, intranasal excipient technology

PsyProtix — Metabolomics-based biomarkers that stratify patientswith TRD with the aim to improve patient outcomes through a precision psychiatry approach

Psyber — electroencephalography, or EEG, -based brain-computer interface technology for psychiatric use

IntelGenx Technologies, or IntelGenx — oral thin film (OTF) drugdelivery system manufacturer (Viridia VLS-01)

Shares Outstanding 160,709,397

10.00% 16,070,940

1.00% 1,607,094

0.10% 160,709

0.01% 16,071

Market Capitalization

$5.41 per share $858,188,180 as of March 30, 2022

$10.00 $1,602,979,520

$50.00 $8,014,897,600

$100.00 $16,029,795,200

$500.00 $80,148,976,000

Initial Public Offering 15,000,000 shares

Filing: $15.00

Pricing:$21.00

The Conference Board’s consumer confidence index rose slightly month-over-month to 107.2 in March compared to 105.7 in February.

The monthly increase was driven by the 77.9% of individuals reporting that business conditions are good or normal and the 57.2% reporting that employment is plentiful — both increases from 74.6% and 53.5% in February, respectively.

On the other hand, the survey highlighted the trend that an increasing amount of Americans are expecting worse business conditions and decreasing income in the next six months.

Inflation is notorious for having an outsized impact on those least able to bear its effects, the lowest earning individuals. March’s survey demonstrated that sentiment with consumer confidence falling the most for individuals surveyed in the lowest income brackets throughout the pandemic.

The labor differential, the difference between those reporting that jobs are plentiful and those reporting the jobs are hard to get, reached an all-time high of 47.4 in March. This further reinforces the expectation that the unemployment rate is being driven even lower in the short term.

Tesla experienced massive growth in March as its stock price surged roughly 30% for the month. A number of cataclysmic events helped thrust the electric vehicle manufacturer back over the $1 trillion market cap club.

March 21,2022 — Tesla opens 'Gigafactory' near Berlin, its 1st in Europe

After finally getting the go ahead in Berlin, Germany, the company opened its first Gigafactory in Europe which is set to employ 12,000 people and produce 500,000 vehicles a year once it's fully up and running. Initially, production in Berlin will focus on Tesla's Model Y compact sport utility vehicle using 2170 battery cells. Tesla’s production volume hit just short of one million vehicles in 2021, which means the new facility has the potential to increase production capacity by over 50%. Another factory near Austin, Texas, is also expected to open soon, potentially during the company’s Cyber Rodeo event next week. Together, the new plants are expected to double the company’s production capacity to about two million vehicles a year. Consensus estimates have shown analysts are already expecting record vehicle deliveries for the first quarter of 2022, which puts Tesla in a strong position to accelerate with the implementation of the new facilities.

“2021 was a year of major advancements across all aspects of MindMed, with significant growth in our organization, development programs and research collaborations. We established a regulatory pathway for MM-120 in the treatment of GAD and for MM-402 launched a first of-its-kind program to develop a novel treatment for core symptoms of autism spectrum disorder—both of which represent a meaningful leap forward in the field of psychiatry,” said Robert Barrow, Chief Executive Officer and Director of MindMed. “We expect 2022 to be a transformational year in which we continue to drive substantial growth across our pharmaceutical and digital medicine pipelines. I am incredibly proud of our team’s achievements and I am more confident than ever in our ability to continue advancing our organization and development programs. We are keenly focused on our mission to deliver novel therapies to treat brain health disorders leading to meaningful improvements in patient outcomes in these major areas of unmet medical need.”

Recent Highlights and Anticipated Upcoming Milestones

MM-120 (LSD D-tartrate): a proprietary, pharmaceutically-optimized form of lysergic acid diethylamide (LSD) that is being developed for the treatment of generalized anxiety disorder (GAD). MM-120 is also being studied under various dosing regimens for the treatment of adult attention deficit hyperactivity disorder (ADHD) and for the treatment of chronic pain.

In January 2022, the U.S. Food and Drug Administration (FDA) cleared the Company’s Investigational New Drug (IND) application for the Phase IIb dose-optimization trial of MM-120 for the treatment of GAD
- Study MMED008, a Phase IIb dose-optimization study of MM-120 for the treatment of GAD is expected to begin in Q2 2022
In December 2021, Study MMED007, a Phase IIa proof-of-concept study was initiated for the treatment of ADHD. The study is designed to assess the safety and efficacy of repeated low-dose MM-120 administration (“microdosing”)
A clinical study of MM-120 in a chronic pain condition is expected to be initiated in Q4 2022

MM-110 (zolunicant HCl or 18-MC): a derivative of ibogaine that the Company is developing for the treatment of opioid withdrawal. MM-110 is an α3β4 nicotinic cholinergic receptor antagonist that has been extensively tested in preclinical models of substance use disorders.

In January 2022, the USAN Council assigned the non-proprietary name “zolunicant” (pronounced: zoe lun’ i kant), to MM-110 or 18-MC
In December 2021, the Company completed a Phase I study of MM-110 with topline data expected in 2022. These results will inform the design of the planned Phase IIa study in individuals undergoing standardized supervised opioid withdrawal, which is expected to commence in early 2022. The Phase IIa study will evaluate the safety, tolerability and efficacy of MM-110 in mitigating symptoms of opioid withdrawal and facilitating completion of detoxification

MM-402 (R(-)-MDMA): a synthetic enantiomer of MDMA that exhibits prosocial and empathogenic activity that the Company is developing for the treatment of core symptoms of autism spectrum disorder. Preclinical studies of R(-)-MDMA demonstrate its acute prosocial effects, while its diminished dopaminergic activity suggests that it may exhibit a favorable safety, tolerability and abuse liability profile when compared to racemic MDMA or the S(+)- enantiomer of MDMA.

IND-enabling studies are currently ongoing, and through the Company’s collaboration with University Hospital Basel, a comparative Phase I pharmacokinetic/pharmacodynamic study of R(-), S(+) and + MDMA is expected to commence in mid 2022

From mid-2020 to the end of 2021, Vertex’s stock price dropped over 40% as the company faced issues with some of its leading drug candidates, making investors skeptical that the company could produce a successful product outside of its family of cystic fibrosis treatments.

However, the company has managed to turn things around, hitting major milestones in the past 6 months. This week, Vertex announced plans to launch its fourth drug candidate into Phase 3 pivotal development study after positive data for its Phase 2 proof-of-concept studies for treatment of acute pain. The company found statistically significant and clinically meaningful results for VX-548 in its trials for bunionectomy and abdominoplasty surgeries. Treatment with the NaV1.8 inhibitor VX-548 met the primary endpoint in both studies and VX-548 was generally well tolerated.

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MCA DENVER

HOLIDAY THEATER OPENS 4/7

Join MCA DENVER at the Holiday Theater on Tuesday, April 12 for a special performance by the Bill Frisell Trio, made up of guitarist Bill Frisell, bassist Thomas Morgan, and drummer Rudy Royston! Grammy award winning guitarist Bill Frisell is said to be “the most important and innovative exponent of jazz guitar in his generation” by The Atlantic.

MCA Denver at the Holiday is a hub for the arts located in the historic Holiday Theater, hosting lectures, music, performance, and more.

FEATURING:

-Grupo Tlaloc Danza Azteca
-Denver’s Poet Laureate Bobby LeFebre
-North High School Jazz Band
-Cleo Parker Robinson Dance
-Poet Eleanor Perry Smith
and more!

LOCATION:
The Holiday Theater. 2644 W 32nd Ave, Denver, CO 80211

TICKETS