Pharma Focus Europe

RespireRx Pharmaceuticals Inc. Establishes ResolutionRx Ltd in Australia to Develop Its Pharmaceutical Cannabinoid Platform

Friday, January 13, 2023

RespireRx Pharmaceuticals Inc., a leader in the discovery and development of innovative and revolutionary treatments to combat diseases caused by disruption of neuronal signaling, is pleased to announce that, on January 11, 2023, it established ResolutionRx Ltd (“ResolutionRx”), a new, currently wholly-owned, unlisted public company in Australia, as the first in a series of steps that include, but are not limited to financings, research and clinical development, manufacturing, regulatory and compliance, all for the purpose of developing compounds that target the body’s endocannabinoid system, and in particular, the re-purposing of dronabinol, an endocannabinoid CB1 and CB2 receptor agonist, for the treatment of obstructive sleep apnea (“OSA”). The Company will contribute certain dronabinol assets and certain liabilities to ResolutionRx.

One of the main purposes for the creation of ResolutionRx was to allow it to participate in the Australian research and development tax credit which in the case of ResolutionRx, is a refund of 43.5% of qualified research and development expenditures as reported on ResolutionRx’s Australian tax return. ResolutionRx is in late stage discussions with an Australia based fund to establish a finance facility secured by the tax credits in order to finance a substantial percentage of the credit associated with the qualified expenditiures over the course of the research and development timeline in advance of the final receipt of the tax credit funds. In addition, ResolutionRx is in late stage negotiations for an equity or equity-linked financing of up to 25% of the research and development budget to be used exclusively to support the research and development budget. Inherent in this financing is a commitment to list ResolutionRx on the Australian Stock Exchange (ASX). ResolutionRx’s intent is to list on the ASX and one or more public exchanges outside of Australia, including the United States.

As the Company has previously announced, in support of ResolutionRx, we have entered into a letter of intent and is preparing a final, definitive agreement with an Australian headquartered, bespoke specialty contract research organization (“CRO”) exclusively focused on cannabinoid and psychedelic clinical research. This CRO is expected to provide full service CRO services, including regulatory, compliance and manufacturing services, either directly or through sub-contractors, in addition to conducting human pharmacokinetic and pivotal efficacy and safety studies of dronabinol. It is anticipated that RespireRx will use, at least initially, its management personnel to provide management, operational and oversight services to ResolutionRx.

According to Jeff Margolis, Chief Financial officer of RespireRx and a Director of ResolutionRx, “We believe that creating ResolutionRx has made it possible to access finance channels separate from and possibly in addition to those of the Company, in order to unlock the unrealized asset values of our pharmaceutical cannabinoid program. We also believe that this will enable us to accelerate the development of dronabinol for OSA with cost effective access to capital while accessing certain financial incentives available in Australia.”

Arnold Lippa, Executive Chairman, Interim CEO and Interim President and Chief Scientific Officer of RespireRx and a Director of ResolutionRx, “I look forward to building this new company and working with our new Australian colleagues. I hope that this approach might interest other small biotech companies to seek novel approaches for overcoming some of the limitations experienced in the United States financial markets.”

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