NeuroScientific to Acquire StemSmart Platform, Marking Entry into Regenerative Medicine

Perth-based biotech NeuroScientific Biopharmaceuticals (ASX:NSB) is set to transform its therapeutic pipeline with the acquisition of Isopogen WA Ltd, owner of the patented StemSmart™ stem cell platform.

The deal positions NeuroScientific at the forefront of the fast-emerging field of mesenchymal stromal cell (MSC) therapies, following recent U.S. FDA approvals and rising investor interest worldwide.

Under the agreement, NeuroScientific will acquire 100% of Isopogen WA’s equity, gaining exclusive rights to StemSmart™—a next-generation MSC manufacturing process with early human data indicating strong safety and efficacy signals in refractory Crohn’s disease.

A Strategic Leap into Cellular Therapy

StemSmart™ MSCs, derived from adult bone marrow donors, are cultured via Isopogen’s proprietary process to enhance therapeutic activity. These cells target immune-mediated inflammatory disorders by modulating the immune response, reducing inflammation, and promoting tissue repair.

The technology has already been used under compassionate access in Australia, including in steroid-refractory graft-versus-host disease (GvHD) patients, with positive responses observed. The platform’s lead indication is fistulising Crohn’s disease—one of the most severe complications of the autoimmune condition.

“We’re incredibly excited to add mesenchymal stem cell technology to our growing portfolio,” said Dr. Anton Uvarov, NeuroScientific’s founding director. “This acquisition not only complements our existing therapeutic peptide pipeline, but also strategically positions us at the forefront of next-generation biologics."

Clinical Momentum and Market Opportunity

The acquisition follows promising data from an 18-patient Phase 2 trial in refractory Crohn’s disease, where most participants improved and many achieved remission. A Special Access Program (SAP) for fistulising Crohn’s disease is planned post-acquisition, with Phase 1/2 clinical trials to follow.

Market potential is substantial. The Crohn’s disease therapeutics market is expected to reach US$13.8 billion by 2026, while other indications—such as kidney transplant rejection (US$7.2B by 2030), lung disorders (US$33B by 2034), and GvHD (US$640M by 2026)—offer additional growth opportunities.

The acquisition also coincides with a regulatory turning point. In December 2024, the U.S. FDA approved Mesoblast’s allogeneic MSC therapy for pediatric steroid-refractory GvHD—the first MSC therapy approved in the U.S.—signalling renewed confidence in the sector.

Deal Structure and Capital Raise

The acquisition will be funded through 85.7 million ordinary shares and 57.1 million performance shares in NSB, the latter vesting upon meeting milestones under the SAP. An additional 2.9 million shares will settle a legacy Isopogen WA debt.

Simultaneously, NeuroScientific has secured A$3.5 million at 3.5 cents per share via a placement to professional and sophisticated investors. Post-transaction, the company will hold around A$7.5 million in cash to support development.

The capital will fund MSC manufacturing scale-up, regulatory strategy, and early-stage trials. Over A$2 million is budgeted for StemSmart™ activities over the next 12 months, reflecting management’s commitment to an accelerated clinical timeline.

Board Reinforcement and Strategic Alignment

As part of the integration, Isopogen WA directors Robert McKenzie and Paul Fry will join NeuroScientific’s board, with stem cell pioneer Marian Sturm appointed Chief Scientific Adviser. The move ensures continuity and deep domain expertise as the company pivots into regenerative medicine.

NeuroScientific and Isopogen share a focus on immune-mediated degenerative diseases, ensuring a strong strategic fit. The combined pipeline will now encompass both peptide-based and cell-based therapeutics—two of biotech’s most dynamic growth areas.

Regulatory and Commercial Pathway

The company aims to launch further trials in refractory Crohn’s disease and other conditions within 24 months, targeting regulatory and reimbursement approvals in Australia and abroad.

Performance shares will convert to ordinary shares upon demonstrating a clinical response in at least four patients under the SAP, leveraging Australia’s . This milestone-based structure ensures clinical progress aligns with shareholder value.

Neuroscientific's SAP is intended to leverage Australia's Special Access Scheme (SAS) that is administered by the TGA. The SAS allows doctors to prescribe unapproved therapies on a case-by-case basis where conventional treatments have failed, are unsuitable, or unavailable. It offers a controlled mechanism for accessing investigational treatments outside formal trials, facilitating the potential for near term cash flows for NSB.