Avid Bioservices Inc (CDMO)

[jakedogman1]

Given AZN seems to be the lead horse, the AZN recent CC might add some insight as to what the "lead horse" is thinking. One concern is that acquisitions must be accretive and focus on oncology. The AVID expansion and tax loss carry forward might help qualify and also AZN mentioned need to expand biologic manufacturing and focus on specialty so smaller manufacturing facilities could work.

So my thinking (which sucks given my investment in this turd) is either Bavi has value and AZN pursues or Bavi is not close enough to being accretive or bavi doesn't work (we don't have an answer yet given MSK recent contract extension).

We do know PPHM has to partner to move the ball forward. They would be incompetent to the extreme to slow play the technology ie IST path.

So the smart thing to be doing is nailing down the AZN path and IF AZN can't go down the path, lining up the next in line. IMO PPHM does not have the resources or SKILL sets to dance with several BP's. AND a sizeable investment is needed and imo BP would want and need to steer the ship with such investment which means control.

From the call excerpts: key segments cut and pasted

http://seekingalpha.com/article/3969757-astrazenecas-azn-ceo-pascal-soriot-q1-2016-results-earnings-call-transcript?part=single

The shape of the business is evolving rapidly now with the growing number of specialty care medicines; in particular, in Oncology.

The growth of our pipeline is such that we have to further prioritize and further sharpen our focus, and we have to allocate additional investments to Oncology.

Our core tax rate was 17% in the quarter, in line with the full-year comments I made in February of a 16% to 20% range, which will depend on the eventual geographical mix of profits.

In parallel to this focus on prioritization, we will reduce cost at the global, regional and country level and make far greater use of shared services. We plan to reshape our manufacturing base, optimizing our presence in key strategic sites while taking into account the need to create capacity in our biologics supply chain.

After providing for investments in business, supporting the progressive dividend policy and maintaining our strong investment-grade credit ratings, we will keep under review any potential investment in value enhancing and immediately earning accretive opportunities.

A comprehensive registration program is underway across multiple tumor types, stages of disease and monotherapy as well as combination therapy. Additional combination studies of durvalumab with other immunotherapies and also chemotherapy are underway. We are very pleased with the progression of our Oncology portfolio and with the advancement of our broader pipeline in 2016 and into 2017.

So essentially we said, okay, we're going to focus now on execution, turning this pipeline into reality for patients and our shareholders. And any acquisitions we would consider would still reflect the criteria we had before. But on top of it, we added this criteria of the fact it should be earnings accretive.