This is considered to be an excellent time to buy Algernon Pharmaceuticals Inc. (AGN:CSE; AGNPF:OTCQB; AGW0:XFRA), which is remarkably inexpensive here following a severe bear market and long basing process as the technical indications are that it is ready to break out into a new bull market as we will proceed to see when we look at its latest stock charts.
Algernon Pharmaceuticals is a Canadian healthcare and clinical-stage pharmaceutical development company investigating multiple drugs for unmet global medical needs. Algernon also recently announced that they are expanding into the Alzheimer's Disease ("AD") screening, diagnostic, and treatment market. This is an exciting new initiative for the company.
After a long, difficult period that resulted in a severe decline in its stock price, Algernon has strategically repositioned itself for success over the past year or so, a development that until now does not appear to have been fully appreciated or understood by investors.
Specifically, it sold its advanced Chronic Cough drug development program, Ifenprodil, to Seyltx Inc for US$2 million and a 20% carried interest in the company. This transaction provided the company with much-needed capital, enabling it to continue to advance its other programs while at the same time giving it a continuing stake in the future of Ifenprodil. The company is now concentrating on moving forward with its most promising DMT stroke treatment program.
In addition, there was the news out on May 13, that Algernon would acquire NoBrainer Imaging Centers, Inc., and plans to establish Alzheimer's diagnostic and treatment medical clinics, featuring new PET scan technology.
This transaction was closed on May 22, as shown above.
This is viewed as a momentous development for the company, as Algernon plans to establish company-owned clinics and sell individual franchise licenses, allowing for rapid expansion throughout Canada, Florida, Los Angeles, and five strategic cities in other American states.
Algernon's structure now may therefore be represented pictorially as set out on the following diagram:
Algernon's main drug research program, which is based on the DMT stroke treatment program, is intended to protect the brain during stroke and also promote recovery afterwards.
As the following illustration shows, DMT is a Psychedelic Drug and Neurotransmitter that is actually a naturally occurring substance.
As strokes are the second most common cause of death and the leading cause of disability globally, the market for a potential breakthrough treatment such as Algernon's is clearly massive.
The following page shows that an astounding 78% of stroke patients currently have no treatment option.
We turn now to the other main arm of Algernon's business, the 20% stake in Seyltx, following the sale of its Chronic Cough Program to Seyltx over a year ago for US$20 million.
While a 20% stake may not seem all that great, it could be a very big earner for the company in the event that the program is taken through to successful completion, as it looks set to be.
That is made clear by the fact that a comparable Phase 2 study completed by Bellus Health resulted in it being acquired by GSK for US$2 billion, as the following page shows.
It is therefore worth reviewing, by means of the following image, the highlights of the Ifenprodil Cough Program.
Finally, the company recently announced a new initiative, stating that they plan to open the world's first dedicated AD diagnostic and treatment medical clinic in the U.S.
"The concept of building Alzheimer's Disease focussed diagnostic and treatment clinics that offer a comprehensive package of medical services, including AD screening, brain specific PET scan imaging, and multiple treatment options, is a unique and exciting approach to help fight this devastating disease," said Christopher J. Moreau, CEO of Algernon Pharmaceuticals.
The Alzheimer's clinics will offer:
- Cognitive and genetic screening, including the APOE genetic test, which can indicate a predisposition to acquiring AD
- Laboratory developed blood tests for early detection of phosphorylated tau protein (an established biomarker for AD, correlated to amyloid plaque)
- Advanced Positron Emission Tomography (PET) scan imaging, using the Positrigo NeuroLF brain PET system, recently cleared by the U.S. FDA, to confirm amyloid plaque presence
- Infusion of current U.S. FDA-approved and U.S. Medicare and Medicaid-covered therapies
- Personalized wellness, nutrition, and longevity programs
The clinics will be anchored by the most advanced PET technology, namely, the ultra-compact Positrigo NeuroLF brain PET scanner, to perform PET imaging using radioisotopes designed to detect and define amyloid plaque build-up, which is associated with AD. The PET scan is also covered by U.S. Medicare and Medicaid
Algernon is planning to open its first company-owned comprehensive AD medical clinic location in Florida in Q4 of this calendar year. After completing an initial startup phase, the company plans to scale up its operations to open 10 additional corporately owned sites in 2026, as well as 10 additional franchise locations, in cities and states to be announced.
Turning now to the charts and starting with the 4-year arithmetic chart, we see that Algernon Pharma appears to have been basing from late 2023, following a really severe bear market that resulted in it losing most of its value. Although it is hard to discern what has been going on within this presumed base pattern on an arithmetic chart, we can at least observe two important and positive points.
One is that there has been a marked overall increase in volume since the pattern started forming, which means that there has been a substantial rotation of stock from weaker to stronger hands. This is so because most of the sellers are obviously selling for a loss, whilst most of the buyers are looking for better times ahead and will not be inclined to sell until they have turned a profit. This has the effect of reducing the available supply and is therefore bullish.
The other point is that most of the volume within the pattern has been upside volume, which is made clear by the persistent strong uptrend in the Accumulation line that has been in force for about nine months. This is a marked positive divergence that normally results in a breakout into a major new bull market. Beyond these observations, there is not much more to observe since the base pattern is flat and featureless on an arithmetic chart. We can get around this problem by switching to the use of a log chart, which has the effect of opening out the base pattern.
On the 4-year log chart (same time period as the arithmetic chart above), we can see exactly what form the base pattern from late 2023 has taken.
It has the characteristics of both a Double Bottom and a gently converging Symmetrical Triangle and may be described as a hybrid between the two, but whatever label it is given, it looks bullish, especially as the Accumulation line has been trending higher during its latter stages. Since this Triangle is now closing up, a breakout is to be expected sooner rather than later.
Zooming in further via a 16-month log chart, we see that the second low of the Double Bottom shown on the 4-year chart is itself comprised of a Head-and-Shoulders bottom, which has been building out since last September.
This pattern is approaching completion with the price believed to be very close to rising away from the Right Shoulder low, and if this is indeed the case, then we are at an excellent entry point. The strongly bullish volume pattern and uptrending Accumulation line support this contention. Whilst moving averages are still in bearish alignment, they are tightly bunched with the price, and so an advance from here will quickly swing them into bullish alignment.
The conclusion is that Algernon Pharma is at a very favorable entry point here, and so anyone holding should stay long, and it is rated an Immediate Strong Buy.
The immediate target for an advance is the resistance in the CA$0.12 area, with the next target being resistance at CA$0.17, and beyond that the CA$0.25 level, with much higher targets possible.
Algernon Pharma's website.
Algernon Pharmaceuticals Inc. (AGN:CSE; AGNPF:OTCQB; AGW0:XFRA) closed for trading at CA$0.09, US$0.067 on May 22, 2025.
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- For this article, the Company has paid Street Smart, an affiliate of Streetwise Reports, US$2,500.
- As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Algernon Pharmaceuticals Inc.
- Author Certification and Compensation: [Clive Maund of clivemaund.com] was retained and compensated as an independent contractor by Street Smart to write this article. Mr. Maund is a technical analyst who analyzes historical trading data and he received his UK Technical Analysts’ Diploma in 1989. The recommendations and opinions expressed in this content reflect the personal, independent, and objective views of the author regarding any and all of the companies discussed. No part of the compensation received by the author was, is, or will be directly or indirectly tied to the specific recommendations or views expressed.
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The above represents the opinion and analysis of Mr. Maund, based on data available to him, at the time of writing. Mr. Maund's opinions are his own, and are not a recommendation or an offer to buy or sell securities. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction, and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund's opinions on the market and stocks cannot be construed as a recommendation or solicitation to buy and sell securities.
