Intellect Neurosciences Inc. opted for the reverse-merger route to becoming a public company, sidestepping some costs and completing the process at an earlier stage of development than the markets likely would permit.

Intellect, a New York-based company focused on Alzheimer's disease and other central nervous system disorders, acquired GlobePan Resources Inc., an SEC registrant company whose main asset was a mineral claim that, along with other assets, was divested before the merger. It shares were never listed for trading.

Intellect, founded in 2005, now has about 35 million shares outstanding. Former GlobePan shareholders got about 9 million of those shares, or nearly 26 percent of the merged firm (about 16 percent on a fully diluted basis). Intellect plans to apply for listing on the Over-the-Counter Bulletin Board.

"You can go the traditional IPO route or the reverse-merger route," Elliot Maza, executive vice president of Intellect, told BioWorld Today. "We went this route because we felt it would be cheaper, allow us to go public at an earlier stage of the clinical-development process and allow us to access the public capital markets at a time that makes sense to us."

Intellect Chairman and CEO Daniel Chain founded the company, and earlier had founded Jerusalem-based Mindset Biopharmaceuticals Inc. Intellect was formed in April 2005, and in July of that year purchased certain assets from Mindset, which had run into funding difficulties. Those assets included Intellect's lead program, the Alzheimer's disease agent Oxigon, which recently completed a Phase I trial in the Netherlands.

Intellect is approaching Alzheimer's disease from both a small-molecule approach, with Oxigon, and through immunotherapy programs based on monoclonal antibodies and therapeutic vaccines to prevent the accumulation and toxicity of the Alzheimer's amyloid-beta toxin.

Oxigon, Chain said, has a dual mode of action. The naturally occurring antioxidant is believed to protect neurons and other cell types against several types of oxidative damage, and it has anti-amyloid activity.

Chain said the Phase I study in healthy, elderly volunteers appeared to demonstrate safety and tolerability. Animal studies already had shown the compound crosses the blood-brain barrier. A Phase II trial testing Oxigon's effect on various AD biomarkers and on cognition is expected to begin early in 2008, he said.

Intellect's initial funding came in 2005 from a $2 million debt deal, some of which was converted in the company's $7 million Series B round in 2006. In the fourth quarter of 2006, it brought in another $2 million through a debt financing.

Earlier this month, Intellect entered a cross-licensing deal with Immuno-Biological Laboratories Co. Ltd., of Takasaki, Japan. Intellect got rights to two therapeutic, beta-amyloid-specific, humanized monoclonal antibodies for Alzheimer's disease. IBL is entitled to milestone and royalty payments, and retained rights in research and diagnostic applications. Intellect also is collaborating with New York University Medical School to develop a vaccine approach to prevent the accumulation of amyloid in the brain.

Intellect's immunotherapy programs include Antisenilin, a passive immunotherapy technology that uses antibodies engineered specifically to attach to the damaging beta-amyloid peptides; Recall-Vax, a vaccine being developed to modify the course of and prevent AD that potentially avoids the incidence of autoimmunity and other serious side effects; and Beta-Vax, a vaccine technology that potentially has broad applicability in the treatment and prevention of amyloid diseases.

Intellect intends to move the Antisenilin passive immunotherapy program into Phase I trials by the end of 2008. The goal of the platform is to design and generate "free-end specific" monoclonal antibodies as drugs that bind to the amyloid-beta toxin without cross-reacting with physiologically important precursor proteins. A Phase I trial of the Recall-Vax technology also is expected to begin by the end of 2008, while the Beta-Vax program is at an earlier stage.