I had to move fast in buying this stock. There was a flood of sellers who were dismayed by the PH3 data, and a fear the longer they waited to sell, the less they would get for their shares.
The sellers understood this company. The commercial prospects for their lead candidate. The pipeline.
The dreams of becoming standard of care in IV -- gone.
Without direct access to the analysts who cover the company, it's hard for me to understand the degree to which the prospective value of the company's pipeline was also reduced by the TRV130 (Olinvo) data.
Sellers were looking at this almost entirely different from buyers and I'm still trying to piece together the state of the world that was changed by the Ph3 data.
So, now I own the shares and I can go through the gradual process of understanding their prospective value, and to degree to which I am seeing the opportunity differently from the sellers.
The company didn't want to acknowledge the data was less great than they hoped and none of the analysts asked them to address the impact on their other compounds, in earlier trials. Later on, after the upcoming CC that I expect next week, I may call the company again to understand this better, if it's not addressed.
I think it was a PR blunder that the company kept a total- happy face on their data call. This heightened, I would think, anxiety by the investor base in that they worried the company was sandbagging them a bit.
As a new buyer of shares, the worse the company's communication in it's post-data CC, the happier I am. I might even be looking for communication flaws when none exist, because I want for them to have existed.
In any event, the investor who is hoping they are early to a blockbuster drug, is gone, or is waiting patient for the shares to go back up a bit so that they can sell...and we can be sure we have massive seller inventory each penny up. This will go on for a long time.
Retail won't bring in many buyers. It's too complicated, and there are too few of them.
So, it's institutions that have to emerge, and they are slow moving beasts. That's, really, the bet I've been making; I can arbitrage from the distressed-post-data sellers, and buy earlier from when the institutions take positions.
This will be a more nuanced sell. The CC is a start. Hopefully the company has another investor day, although possibly they won't if they are concerned that it will look bad to the FDA to have an investor day coinciding too closely with their 4thQ FDA filing.
As a buyer, all I have to worry about for the moment is how closely I came to buying at the post-data bottom. The recovery process, if there is one, is complex and a lot of moving pieces have to come together.
So far, $4 is holding support.
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The company said they will show up at all the pain management conferences, and start the education process to the pain management profession as to the coming launch of Olinvo. They will publish papers.
I dread the company hiring their own sales force. That's a bit down the road -- but not much. They will need to start the process soon of hiring the core team that will then hire the sales team. This will indicate the company is discounting it's chances of selling to a BP or of finding a BP sales partner.
For now, I'm taking the view that BP's are stuck with expensive sales and marketing staff who need to be fed new product. A global IV pain market share of even a small size might still be sufficient revenue to make acquisition a good bet for a BP, and with a company management that might see an acquisition as their easiest pathway to personal wealth...and certainly the VCs who still own their stock will have a strong preference for this.
