Email from Doody
Mr. Graham,
Thank you for sending me your message. All I can say at this time is that I am sorry that you feel the way you do, however as a retail shareholder, I can understand why you feel the way you do. I can do my best to try to explain the offering price. We announced our intention to raise the $60 million dollars. These funds are necessary for us to begin spending what is needed to be able to start the phase 3 trial of IMO-2125 in the first quarter of next year. I know many investors have made comments about us already having cash into the 4th quarter of next year and that was certainly true, however what is missed by most is that when you begin a clinical trial, you need to have already the money required to run the entire study. Trial sites won’t even participate if that is not the case. The enrollment of this Phase 3 trial is going to take until mid-2019. It is 300 patients at roughly 80 sites globally. We also need to have the funds to reimburse sites for the ipilimumab usage as well. So we had to do this raise right now to start this trial. Running this trial and getting this drug approved is the most rapid way to move this company to a place where we are generating our own revenues and not relying on investors to fund the business moving forward.
As to the pricing, simply stated the demand for the deal from the institutional investors who funded it, was gated at $1.50. So when you refer to someone having us “by the balls,” you couldn’t have possibly described it any more accurately. The large institutional investors stepped on our necks because they knew they could. I would also guess at this point today, they are probably taking advantage of the retail sector and buying all of the shares at the cheap price when retail investors are dumping their shares in a panic.
Since you referred to Mr. Milano and myself directly, I would like to share with you my assessment of what we have done since arriving at this company. When we showed up, there were a number of potential scientific opportunities. In fact if you ask me to describe Idera from the prior 25 years, I would say this company was essentially one big science project. Our task upon being hired was to turn this company into an actual business that in time will actually generate revenue.
Over the course of these 3 years, we have deeply assessed all of those various “scientific opportunities,” some of which were still in the pre-clinical stage and some were already in clinical development. We defined a strategy of what type of company we wanted to be, one that is focused on developing and commercializing drugs for significant unmet needs and rare diseases.
The first thing we identified was that IMO-2125 had an opportunity to be very special, even though at that point we were only seeing the first mouse data. We rapidly prioritized this asset and began the clinical development program, which was also buoyed by the collaboration with MD Anderson. We’ve now established the proper dose and safety for the drug through Phase 1. We are already generating positive data from the ongoing phase 2, and importantly there are people walking around today that otherwise would not be, had this drug not saved their lives.
And, we are on the cusp of starting the first ever Phase 3 trial that this company has ever done. So in less than three years, we’ve moved a drug from pre-IND mouse data to Phase 3. That is fast by any standards.
For IMO-8400, the b-cell trials were already underway when we arrived and frankly when we looked at the data when it became available, it was not nearly good enough to invest any further. So we stopped that. On the other hand, we’ve just completed the enrollment from the Dermatomyositis trial in Phase 2. That data will be available in the 2nd quarter of next year. If it is good, that could be another Phase 3 opportunity for a drug that could generate peak year sales in the hundreds of millions.
IMO-9200 had a little bit of healthy volunteer data and some pre-clinical data that indicated it might have some potential success for large autoimmune conditions. Developing and commercializing a drug in that space would have been incredibly costly and did not fit with the rare disease strategy, so we found a partner to offer us a fairly decent amount of upfront cash, for a drug that early and has sizable milestone payments in the future if it works.
Lastly, we have this 3GA technology, which was really in its infancy when we arrived. We were able to secure a partner, albeit not a huge upfront investment, but one that was reasonable for something with relatively no pre-clinical data whatsoever. We also have been working to do all of the necessary activities to get to the point where this could potentially be safe to put into humans. That will arrive next year.
So, I guess the point I am trying to make here is I believe we’ve made a tremendous amount of actual progress in turning this organization into something that could be successful. We’re clearly not there yet, but we are so much more on track to becoming that, then the company ever would have been 3 years ago.
IMO-2125 still has clearly not captured the imagination broadly of the investment community. Not enough to buoy the stock to the heights it deserves. I am not sure what amount of data will be that trigger. Only thing we as a team can do is keep recruiting patient and presenting updates until that moment arrives, where the broader stock market community finds it absolutely compelling.
So, I’m sorry for the very long winded answer. It is my hope to try to personally respond to every single shareholder who has sent me a message over the last 24 hours. With the exception of the several who found very colorful ways of telling me to kill myself or do things to myself.
I’ll leave you with this. We joined this company and we do this job to work to bring solutions for patients who don’t have any. I’ve been a part of that my whole career. I can honestly say there are people alive today, who would not be had it not been for IMO-2125. We are going to continue to drive forward to get this drug approved so that I can make that same statement about thousands of patients. There are many times that it is painful along the way, but we have the intestinal fortitude to drive through that to get to the finish line.
You do have a very beautiful family, and if I may add, they are your best investment in life.
Respectfully,
Bob
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