Hi folks.

I’m just thinking out loud here again regarding Zenith share liquidity and trying to get some sort of perspective on it.

Source - Based the Biotech Showcase Presentation in San Francisco;

Page 3

• Considering a US Market IPO
• Raised $19,500,000
• Burn rate at $6,400,000/per year, which will increase as trials start. The implication is that there is no immediate rush for new funding.

Page 18

• IND received in Q4 2015

Page 20

• Single Agent Dose Escalation – covers all of 2016

Page 26 - This is the Zenith Milestones page.

• Proof of concept for Zen 3694 by 2nd half of 2016

My comments - There are no commitments on Corporate Development including the IPO on NASDAQ, Regional licensing in China, Co-development partnering and New BET Bromodomain opportunities.

Source – AGM Jan 7th – Masila’s notes

The IND was filed late last year and I’m very happy to announce that we received a letter yesterday with approval (a couple of minor housekeeping clauses to be dealt with), so we are now able to commence with Phase 1 with the FDA US.

We will start with single agent dose escalation. These patients, 12 or so, start with 7.5mg for 28 days, and then it’s doubled and doubled again so by about the third dosing, we should start seeing some activity. We are hoping to see results by the summer. What we then do is a second cohort that will be in combination with enzalutamide where we can show that our drug in combination with the best drug on the market is an effective booster of both. Then we have the ability to take the same drug to start working in expansion cohorts such as breast cancer. So we’ll have both the male and female program going by 2017.

(from later in the presentation)

Q: Length of trial?

A: We’re starting at 7.5mg (other trials start much lower because they haven’t done groundwork like we have). Dr Hansen corrected him and said we actually start at 48mg and double every month. By the time you’re into the 3rd cohort, you are seeing results. You know efficacy by whether patients are surviving or not.

• My question - This 12 person initial trial phase should take about 3 months plus the time for various dosing starts assuming all 12 patients won't start on the same day so let's assume they have results in Q3 2016. Is this what Don and Zenith are calling proof of concept and would this be when the 1st ZEN 3694 IPO could or would be launched?

Q: Can part of ZEL be sold? E.g. just the prostate cancer portion?

A: Yes, Henrik Hansen has done a great job of compartmentalizing the IP. It’s kind of an “onion” approach – different layers can be peeled off and sold separately. Key is to focus on and get this first Proof of Concept done to prove our approach – then the floodgates will open

• See my question above. If the floodgates open after the analysis of a successful 12 person trial of 3 months then I will be very pleased if it leads to some ZEL liquidity!

Q: How soon will shareholders see any money in their pockets? (my paraphrase)

A: Earliest payouts to shareholders in the form of dividends from ZCC would be in 3 years. It’s a longer term strategy. If it was sold in whole or in part, you would see something sooner.

Fouremm – a post on Agora re Zenith AGM on Jan 12th, 2016 at 10:14 p.m.

KBC, Don did not address the division of value specifically. He did say that he felt that once the newco is public and in phase 1 that on it's own it would be worth more than $1. Just his opinion though and obviously that per share value will be influenced by what vehicle he takes to go public, ie the reverse takeover route he spoke of or just a standard listing of the private co. Judging by his comments during and after the meeting it would seem that taking the newco public is a high priority for him. JMO but I imagine that the split has been done, from an accounting perspective, so that any value creation in the newco can be deemed to have occurred after the formation of the corporation in order that nothing taxable is created until such time as a shareholder sells shares. Again JMO.

• My Comment - I can imagine there are shareholders of Zenith with very large holdings and no liquidity and I bet some are furious that we are headed into the 3rd year with no clear plan for liquidity.

Discussion

There is no question in my mind that there is strong science going on at Zenith with ZEN 3694 being able to engineer BRD4 such that the resistance to current prostate therapies being reduced thus allowing for longer effective treatment and the ability of ZEN 3694 to be able to work with many other standard of care drugs.

I can feel the positive vibes and excitment of ZCC based on masila's and fouremm's comments and I think the excitment has been earned by the science.

However, I've been around a very long time (not as long as some) and while I remain enthused I am also becoming far more skeptical about delivery. What I see in front of me is many years in trials and there will be successes and failures along the way and lots of good learning as well but I do not think there will be any money made soon.

Don stated that dividend payouts would take 3 years and I believe that is extremely optimistic.

I am very excited by the possibility of a business model as described by PVLee on Dec 12 could happen but we don't know if that is what ZCC has in mind. It seems they do based on the AGM but it is not crystal clear to me (please understand I'm not the brightest light in the Christmas tree... hohoho).

So if the 3 month prostate trial on 12 extremely sick patients succeeds and if it is the basis of the first IPO then I am happy (although that will take 6 months to get analysis, etc).

I will be very honest with my feelings here. I believe that the earliest any ZEL liquidity will occur will be in at best 18 months and that is optimistic.

That being said there are many possibilities emerging and anything could happen. The momentum is building on a number of fronts including interest in epigenetics among scientists, pharma and the investment communities, the entrance of some BPs into this game, etc.

If the 12 man prostate trial turns out to be extremely positive it will provide some interest and leverage.

So as usual please prove me wrong or give me a different perspective. I really hope my cynical attitude is not justified but as the saying goes "if it sounds too good to be true...it's not true". This is 2016.

Thanks again to masila and fouremm for the notes.

Now For Something Completely Different

• When I was out for an LSJ (long slow jog) an idea popped into my (little) brain. I realize that Sharks Tank and Dragon's Den (Canada) are silly reality shows but I started to think about how the judges, and in particular, Kevin O'Leary, would be reacting if Don presented his Biotech presentation to them!!!
• Think about it. I won't say what I think but it is very clear in my mind and in fact it is worth thinking about somewhat seriously.
• Don't get me wrong, I have no respect for Kevin O'leary but some of the other judges have some credibility.
• Anyway, I found that thinking about this seemed to put RVX and Zenith into perspective.

GLTA

Toinv

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