Diffusion Pharmaceuticals (NASDAQ:DFFN)
A $61 Billion Opportunity In Cancer & Stroke Treatment


If cutting-edge technology, innovative product pipelines and billion-dollar markets excite you, then take a close look at this Biotech pioneer.

Our research and due diligence has discovered Diffusion Pharmaceuticals  Inc. (NASDAQ: DFFN), a clinical-stage biotechnology firm that offers a revolutionary approach to the treatment of life-threatening diseases caused by cellular oxygen deprivation (known as “hypoxia”). Heart attacks, brain strokes, arterial blockages and cancer are all a result of this condition, which is frequent – and deadly. Strokes cause 6.2 million deaths a year worldwide, while heart attack alone kills one in four Americans. The global economic impacts are huge, with government and healthcare providers scrambling for a better treatment solution both in terms of patient well-being and financial saving. And, DFFN stands to gain up to 780% in the next 12 months by providing it.

DFFN’s innovative product pipeline revolves around the application of trans-sodium crocetinate (TSC), a small-molecule compound helps regulate the movement of oxygen into tissue by a mechanism of action targeting hypoxic micro-environments. TSC re-oxygenates treatment-resistant tissue and makes cancerous cells weaker against conventional radiation and chemotherapy treatments.

The TSC molecule was developed in the 1970s by John L. Gainer, Ph.D., a pioneer in the field of oxygen diffusion and the Chief Scientific Officer of DFFN. Its extraordinary potential has since been the subject of a significant body of peer-reviewed scientific research, which has shown that:


TSC has also captured the attention of the the defense sector – the Office of Naval Research has researched it as a treatment for hemorrhagic (massive blood loss) which affects military personnel during battle. Based on this promising and scientifically-tested potential, DFFN is working to release the broadest range of TSC applications to successfully take on stroke and the most challenging forms of cancer.


A Product Pipeline Potentially Worth $61 BILLION

DFFN is currently and simultaneously developing four applications of TSC, all with tremendous market potential:


TSC For Gliobalstoma Multiforme (GBM)

DFFN’s most advanced program targets GBM, the most aggressive and life-threatening form of brain cancer, affecting 28,000 patients worldwide.  GBM is among the most hypoxic cancers, with significant resistance to both radiation and chemotherapy. The average life expectancy post-diagnosis of GBM is less than 2 years. DFFN’s Phase 2 study for GBM saw a 284% improvement in two-year survival rates (40.0% alive at two years vs. 10.4%) for newly-diagnosed, inoperable patients, and a 37% increase in overall survival two years after. Based on these results, in early 2018 DFFN began the Phase 3 INvestigating Tsc Against Cancerous Tumors (INTACT) clinical trial. The trial is anticipated to screen 300 patients with inoperable GBM and enrol 264, such that results from 236 patients will be available for analysis. DFFN could be ready to file a New Drug Application (NDA) by 2023, with potential approval in 2024.

The market for GBM treatment is meanwhile continuing to grow fast. Estimates are that it will expand from $659 million in 2014 to $1.15 billion or up to $3.3 billion by 2024. With TSC potentially filling a large unmet demand for GBM treatment, DFFN could become the dominant player in the market in the coming years.


TSC For Stroke

In September 2018, DFFN received FDA approval to enroll patients in an ambulance-based Phase 2 clinical trial testing TSC for the treatment of acute stroke. The trial, named PHAST-TSC (Pre-Hospital Ambulance Stroke Trial-TSC), involves 23 hospitals across urban, suburban, and rural areas in Los Angeles and Central Virginia, working closely with approximately 150 emergency medical transport groups. The trial is expected to commence in the coming months with results potentially available by late 2020, paving the way for Phase 3 clinical trials. There are approximately 800,000 strokes every year in the U.S., which are responsible for the deaths of approximately 140,000 individuals, costing the US healthcare system $34 billion a year.

The use of TSC to treat strokes looks extremely promising. A study of treatment with TSC one and a half hours after the onset of ischemia led to a reduction in infarct volume of 32%.  A second study showed treatment with TSC reduced infarct volume by 34%. DFFN is de facto developing a stroke product with almost non-existent competition. The only FDA approved treatment for acute ischemic stroke is tissue plasminogen activator (tPA), which has significant side effects including hemorrhagic strokes. DFFN’s true innovation has been in creating a combined TSC-tPA regimen for stroke, for which in December 2018 DFFN was awarded a patent, propelling the stock up 71% in one day. According to Thomas E. Byrne, the company’s General Counsel, the patent “gives Diffusion exclusive rights over the use of these two drugs together, a combination which may make a real difference for patients suffering from stroke.”

With worldwide sales of recombinant tPA expected to reach $1.9 billion by 2022, DFFN’s combined drug therapy could by itself generate over $1 billion in revenues annually. The global market for stroke treatment is expected to be worth $36.7 billion by 2023, opening the door for DFFN to provide the market with a superior solution.


TSC For Brain Metastases

Metastatic brain cancer spreads from a primary tumor location to elsewhere in the brain. These occur in 20% to 40% of cancer patients with an estimated 98,000 to 170,000 new cases diagnosed in the United States each year. DFFN sees TSC having significant potential to improve treatment, as the median survival following whole-brain radiation therapy is today only 3 to 6 months. DFFN’s program for brain metastases has been granted Orphan drug designation by the FDA, which allows certain favorable treatments in connection with exclusivity periods and the new drug approval process. The market for treatment of brain metastasis is worth up to $8.4 billion.


TSC For Pancreatic Cancer

Pancreatic cancer is among the most deadly of cancers, showing an average 5-year survival rate of less than 10%. Existing pancreatic cancer drugs have failed to extend the life expectancy of patients in any meaningful way, leaving the market open for a viable product. Phase II clinical trials for DFFN’s TSC-based treatment of pancreatic cancer are expected to start in 2020, with 2025 as the potential release date for the new drug. The market for pancreatic cancer treatment is projected to reach $13 billion by 2021.


A Growing Portfolio Of Valuable Patents

DFFN’s extensive R&D spending over the years has led to accumulate a remarkable intellectual property portfolio. The company today holds fourteen US patents and forty-six foreign patents. These cover the major markets (United States, European Union, and Japan) with key patent life until 2026, plus expected extensions until 2031.

In addition, the seven-year Orphan exclusivity provides additional protection, and formulation patents provide protection for the TSC oral drug product until 2031, with possible extensions.


An Appetizing Buyout Target For Global Biotech Giants

Innovative biotech startups regularly become appetizing acquisition targets for global multinationals. More than $100 billion was spent in M&A activity in the first half of 2018 alone. More likely than not, competition between companies in the same sector niche, like cancer treatment, ends up in only two ways – a merger or an acquisition of the smaller company by the larger one. Major players like Merck (NYSE: MRK), Alexion (NYSE: ALXN) and Sanofi (NASDAQ: SNY) have all completed acquisitions of developing cancer treatment biotech and could soon set their eyes on DFFN:





Target Purchase Price Purchase Price Premium
$394 million +160%

Merck & Co., Inc. (

Market Cap: $198.8B

Merck, with estimated sales of $44.7 billion in 2018, is active in the cancer treatment with a series of globally-marketed capsule and injection products including Keytruda, Sylatron, Ontruzan, Temodar, Zolinza, and Emend.  Merck recently acquired cancer drug firm Viralytics for $394 million –  an acquisition price premium of 160% over the stock price.





Alexion Pharmaceuticals Inc. (NYSE: ALXN)

Market Cap: $28.2B

Target Purchase Price Purchase Price Premium
$855 million +70%


Alexion Pharmaceuticals Inc. is an American pharmaceutical company best known for its development of Soliris, a drug used to treat the rare disorders atypical hemolytic uremic syndrome and paroxysmal nocturnal hemoglobinuria. The company is also involved in immune system research related to autoimmune diseases. Alexion acquired Wilson Therapeutics to boost its line of products for rare hepatic and neurological diseases, paying a 70% price premium.







Sanofi S.A. (NASDAQ: SNY)

Market Cap: $106.6B

Target Purchase Price Purchase Price Premium
$11.6 billion +64%


Sanofi S.A. is a French multinational pharmaceutical company and the world’s fifth-largest by prescription sales. The company has a significant presence in the skin and prostate cancer markets. However, as a latecomer to the cancer treatment market, is trying to rapidly catch up with competitors and expand its product line, one of the reasons behind its $11.6 billion acquisition of Bioverativ at a 64% price premium.

And these are only three examples out of a massive 248 deals happening in the biotech space in 2018. The buyers in all cases offered significant price premiums over the market price. Typical premia for acquisitions of biotech companies with no approved drugs range between 50% and 100% above market price, but at times can reach 500% or more. DFFN, with a market cap of only $7.2 million and various cancer treatment applications under development, could well become a contended target for multinationals aiming to expand their future presence in the cancer treatment space.


An Unrivalled Biotech Sector Standout & The Exciting Catalysts Of 2019

DFFN clearly stands out among its competitors in the cancer treatment sector, including ESSA Pharma Inc. (ASE: EPIX) and Checkpoint Therapeutics Inc. (NASDAQ: CKPT), both for its product pipeline and its price upside:





ESSA Pharma Inc. (ASE: EPIX)

Current Market Price: $5.20

1-Year Target Price: $14

Upside: +252%






Checkpoint Therapeutics Inc. (NASDAQ: CKPT)

Current Market Price: $4.00

1-Year Target Price: $15.5

Upside: +314%






Diffusion Pharmaceuticals Inc. (NASDAQ: DFFN)

Current Market Price: $2.25

1-Year Target Price: $18.75

Upside: +780%


With a price target of $18.75 in the next 12 months, DFFN shareholders stand to reap profits of 780% on their investment from the current price. Furthermore, at the end of Q3 2018 the company had $11.0 million in cash and cash equivalents on hand, covering its financial needs for 2019, and a total book value of $20.9 million. This means that DFFN is trading for less than 1x book value and 30% less than its cash on hand. By buying DFFN stock, an investor is literally getting the company’s pipeline, innovative patents and potentially market-dominating products – all for free.

In the next months of 2019, investors should expect to see enrollment info for both the Phase 2 study of the TSC treatment of stroke and the Phase 3 study assessing the TSC treatment of glioblastoma. There will also likely be interim data releases from all clinical studies being conducted, which will keep DFFN firmly on the radar of investors. Furthermore, as the biotech community gains awareness of the potential of TSC-based hypoxia treatments, larger pharmaceutical players will take a closer look at DFFN as a potential partner – or acquisition target. With products developed to address a market with enormous unmet needs, DFFN is developing a first-mover advantage that could be worth billions of dollars, to its industry and to prescient investors.





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