This is important because other research has shown that the expanded gene down-regulates BDNF and impairs the growth of new brain cells. Dying cells begin to win the balance in the continuous replacement of cells throughout life.

Blueberries may contain the molecule that Cogent was looking for. To help the multitude of those at risk or suffering from HD it will take a proprietary patented molecule with the same effect. Low cost, now available, blueberries can not compete with the aggressive sales of drug companies for the benefit of mankind.

The Cogent staff has been working without pay. They are on to something. --Jerry

Posted to HDLighthouse: 12 Dec 2002 HDL Update: Cogent Leads to New Neuroscience

New Approach to Brain Repair "With the technology developed in the past four years now in the hands of the trustee, Wallace says he and a few others are talking about a new approach. But he declined to discuss any details." Max Wallace, CEO Cogent Neuroscience.

DURHAM – Cogent Neuroscience's management has pulled the plug and filed for liquidation of the biotechnology company's assets under chapter 7 bankruptcy.

The Dec. 2 filing in U.S. Bankruptcy Court for the Eastern District of North Carolina ends last-minute attempts by Max Wallace, Cogent's co-founder and chief executive officer, senior executives and researchers to bring the cashless company back to life.

The group of up to 20 had been working without pay since Cogent's final 48 employees were laid off in early October.

Gerald Jeutter, a lawyer with Kilpatrick Stock-ton in Raleigh who represents Cogent in bankruptcy court, says the group of executives simply ran out of options.

"Cogent was unable to arrange the next necessary round of funding, and it did not look like prospects would be any better in Chapter 11," Jeutter says when asked why the company didn't file for a reorganization of its debt.

Once the investors cut off Cogent, "We felt we had to address our creditors' interests fairly," says Wallace. But that doesn't mean he's given up on what Cogent's research tried to accomplish – finding gene-based treatments for neurological disorders and diseases such as Alzheimer's, Parkinson's and Huntington's diseases and stroke, he adds. "I'm 50 years old and scared of all the things we're working on."

Wallace's track record – he co-founded three Triangle biotech companies that have been sold or gone public – was a key to Cogent's ability to raise $20.4 million in venture capital since the company's inception in 1998. Investors included Atlanta-based Cordova Ventures; Aurora Funds, Eno River Capital and Intersouth Partners, all of Durham; Franklin Street Partners of Chapel Hill; and Kitty Hawk Capital and the Wakefield Group, both of Charlotte.

In 2001, the Durham biotechnology company hooked Irish pharmaceutical giant Elan as a corporate sponsor. Elan made a $10 million investment and committed a similar amount to fund research and development.

But Wallace's luck ran out in this year's uptight private equity environment. Trying to put together a $25 million fundraiser, he balked at investors' assessments of how much Cogent was worth.

By May, the company had less than $2 million left to fund operations, had cut employment, which peaked at 85, by about 10 positions and lost its chief financial officer. A second round of job cuts, which laid off 14, followed in July. By early October, all research and development stopped.

Initial filings in bankruptcy court to seek protection from creditors report Cogent's estimated debts at $1 million or less. Top creditors are business lenders Finova Capital in Farmington, Conn.; General Electric Capital in Pittsburgh, Pa., and Alexandria, Va.-based Oxford Finance; and law firms Hutchinson & Mason in Raleigh and Pennie & Edmonds in New York.

Cogent lists its assets at $100,000 or less, according to the bankruptcy filings.

Much was leased, including buildings and equipment, says Jeutter. Money from investors and partners was spent on research and development and its employees.

"All assets are now property of the estate," he adds. "I will work with the (bankruptcy) trustee to identify a purchaser of the hard assets and the intellectual property."

Cogent's technology was based on discoveries made by Duke University neuroscientists Lawrence Katz and Donald Lo. The duo had figured out a way to prevent or delay cell death, a phenomenon that plays an important role in neurological conditions and disorders such as stroke and Alzheimer's disease.

On Aug. 21, 2001, Cogent was granted its first patent. A second patent, for which the company applied four months ago, is pending.

With the technology developed in the past four years now in the hands of the trustee, Wallace says he and a few others are talking about a new approach. But he declined to discuss any details.

Source: The Bussiness Journal, 06 Dec 2002

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