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I'm not sure what happened at ROSG is relevant at all to ADXS because from what I understand ROSG' product has serious market and IP challenges that no CEO could have saved.
O'Connor wasted a lot of money on what is now a construct that is becoming dated. Do you think a potential partner is essentially going to reimburse ADXS for O'Connor's incompetence? Unfortunately, we're the ones paying for it. Also, remember you had projected if I recall ADXS got around $25 million from Amgen for the first patient dosed in NEO. Well the quarterly report just released showed we got $0 for the first patient dosing. I'm still hopeful we'll get an AXAL partner, but I woulnd't be surprised if there was very little upfront, as it would be a benefit if they simply paid all remaining costs since it's no longer a focus to ADXS and low value compared to HOT and NEO.
Blue, denial of reality doesn't help anyone and is as bad as bashing IMO. Wake up, in 2018 they have sold half the company for $40 million, diluting half our ownership stake. If they could have gotten even half of that ($20 million) in upfront cash for AXAL, they would have taken it in a heartbeat and saved the damage to shareholders.
"Tone and body language gives away a lot."
Exactly, which is why they may have decided not to do a CC at this point in time. If they are about to close an AXAL or HOT deal and were asked about it on a CC they might risk unintentionally signaling a deal is about to be announced. So better to not have the call, then announce any material development and have a call to specifically address it.
I see it as a positive sign that they aren't doing a conference call and there was no mention of AXAL in the press release, which could mean they are closing in on a deal on AXAL and can't say anything about it either way at this point.
Berlin inherited a mess of a company but he has shown resolve in righting the company's misguided business strategy and reducing the reckless cash burn of the last five years. Most importantly, unlike Dan O'Connor the liar, Berlin is honest and ethical and aligned with us. O'Connor burnt investor trust, and we are paying for it now as evidenced by the terrible terms of these last two raises. This recent quarterly report though shows Berlin's focus and promise as a real CEO. IMO he will rebuild the trust O'Connor lost and hopefully with some kind of deal on AXAL and a monetary deal on HOT we will be back up to a fairer valuation in the coming months.
Blue, hang in there. It is not over yet. Berlin is doing as good of a job as he can and has made positive changes. Yes, this latest offering sucks, but this offering and the $2 offering was forced on the company because of years of mismanagement and poor strategy by O'Connor. Moreover, O'Connor is a rotten person for the unethical things he did to slight shareholders to line his pockets, and we are paying for it now. The straw that broke the camel's back was in the spring of 2017 not delivering any Europe deal while at the same time jacking up the unearned RSU program even more and slapping investors in the the face with auto escalations outside shareholder approval. A near majority of shareholders voted against this measure, and it was the catalyst for his firing and the exodus of our tute holders and the market no longer trusting the company.
That said, look through the current corporate presentation. The science and platform remains compelling. HOT and NEO could prove to make the company a forerunner in immunotherapy if Berlin doesn't f-up the business strategy and execution like O'Connor did. Berlin needs to partner some HOT constructs early to help de-risk and strengthen the company's balance sheet (like ADRO did with JNJ on first gen). The "go it alone with AXAL to get a bigger US & Europe deal later" strategy that O'Connor had was dead wrong and shows what a self-serving dim wit he was. Berlin is making the right moves. Unfortunately, the denegration in the terms ADXS now accesses capital shows that O'Connor was on the verge of bankrupting the company. If Berlin can strike one HOT deal by the end of this year, we could be on our way back to a fairer valuation.
If Adage participates in this offering, that would be a good sign of things to come. Then again, we've been disappointed by this company so much, not sure what to expect anymore.
One silver lining, potentially, is that the first few capital raises ADXS did in late 2013 and 2014 included warrants, which could have contributed to the upward push of the stock (peaking at $30) as participants drove the stock up, sold warrants to lock in profit then shorted the stock back down. It's good that short interest has nearly all been closed out at this point as the stock's been ridden to the ground. Let's see if this new offering/package incentivizes the players to run the stock back up.
Agree James. What I also can't get my arms around is why they would consider scrapping a Phase III trial in progress that has an FDA SPA already granted and why no one would want to partner with it. We're also talking about a construct (HPV cervical) that showed best ever survival in its Phase II trial (better than Avastin). And the current Phase III trial is doubled blinded I believe so its not as if they looked at the data and didn't think it was going well (they don't know). Perhaps given the rapid progress in immunotherapy folks see our fist gen constructs as dated now. Goes to show how fatal and shortsighted O'Connor's business strategy was not partnering AXAL early to instead hold out and try to get more later. Meanwhile Issaacs partnered ADRO's first gen constructs early in deals valued at $1.2 billion to J&N, smart move, as ADRO's market value is now over $600 million while ours is less than $100 million yet our tech is supposedly superior. IMO O'Connor should be in jail for what he did to investors and be required to pay back the unearned comp he took from shareholder capital.
Well if you recall they have been working on an AXAL deal since they first publicly mentioned it in their January 2017 business update....
Zach, nice article, thanks for your ongoing coverage of ADXS. Just one (significant) correction regarding your statement below, ADXS didn't get any upfront payment in the Knight deal. Instead it was another weak O'Connor deal in which he gave away rights for Canada for nothing upfront. The $25 million was a sale of shares/dilution.
"In 2015, however, we did see a deal worth $25 million between Knight Therapeutics and ADXS for rights to their therapies in Canada, so it is possible that I'm being conservative."
Read the ADXS press release today. At the end, ADXS is called a late-stage company, which is synonymous with a company with a phase 3 trial in progress or completed. The government clinical trial website currently reports ADXS has an ongoing Phase 3 in cervical cancer. Until the company makes a public statement otherwise, you assertion is incorrect.
How about the bonus O'Connor gave himself for supposedly getting the NEO IND done ahead of schedule. Then he sat on his hands literally a year not doing anything to start the trial and the IND eventually had to be amended before the first patient was dosed. We're lucky he didn't bankrupt the company considered he was left uncheked for four years. Berlin is the right man for the job.
Agree James, Berlin is deal maker. He just partnered a construct that was all but written off, so my best guess is we will soon see a partner for AXAL which the company said they have actively been pursuing a partner.
Need to get back above $7.45 year high for the market to show confidence that Berlin is right the train wreck O'Connor and Lombardo caused. Hopefully by year-end.
For some reason the news doesn't appear on Yahoo Finance under ADXS
The journey back to $30 happens one dollar at a time....
Hoping today's deal and others that follow (AXAL, HOT) get us back to the $10 to $15 range by year-end.
Agree, and this also implies that it is likely an AXAL deal will follow, then a HOT deal. HER2 for pediatric osteosarcoma has not even begun a phase 1 trial, and now we have a partner paying for it all, whereas AXAL for cervical cancer has already completed a phase 1 and phase 2 and is in an ongoing Phase 3, so look for an AXAL partner next.
Way to go Ken Berlin. You are aligned with us and a real CEO.
Ken Berlin = ROI focused, fiscal restraint, alignment, leadership, intelligent business strategy, mentality of "I win only if my investors win"
Dan O'Connor = "me" focused, fiscal recklessness, showmanship, no substance, weak business strategy and execution, unethical, mentality of "I win at the expense of my investors"
Let's give him the benefit of the doubt (until he lies to shareholders like O'Connor did). He's definitely made some material changes with the reduction in workforce, more focused restrained use of cash that was previously treated like it grew on trees and now prioritizing the need to partner and bring in non-dilutive cash rather than the misguided strategy of "spend significant resources to develop AXAL as far as possible internally in order to get a bigger deal later".
Mr. Market saying warrants may potentially be in the money (above $5 strike price) come October 15. We should be valued at least on par with Affimed. Get it done Berlin. You already opened your wallet and made a material open market purchase so you have skin in the game, which is more than your pathetic predecessor ever did in four years, and you showed you are serious about generating a ROI and turning the company around by curbing back on the irresponsible spending your inherited. Looking forward to see what you deliver after Labor Day.
Only if it were that simple. Yes, nothing is wrong with the science, but you don't seem to grasp that from a business return on investment perspective, O'Connor wasted a great amount of capital through a weak misguided strategy, lack of fiscal restraint and less than honest actions to line his own pockets, which did a lot of damage to investor trust (just look at the share price collapse). So it is much more than just the science. Remember, Betamax was a superior technology versus VHS but today's generation hasn't heard of Betamax because it went under to do poor business strategy and execution. For every promising technology that never saw the light of day, there's likely a looser like a O'Connor affiliated with it in the ream of history.
Market recognizing there is a decent chance they will be in the money come October 15 if Berlin announces a HOT or AXAL deal that gets us back above $5.
If Berlin is worth his title of CEO (and not a paycheck collector like Lombardo waiting for retirement, or an opportunistic crook like O'Connor without an thoughtful strategy burning our cash and lining his pockets with no accountability) we will see a deal soon. Berlin's efforts to turn around the company through real cost cutting and change to a viable business strategy are real, so I expect a value added deal to follow.
Exactly, no one knows. It's a big error to list the name of a company as a partner for a program without a partner to date. Why didn't anyone catch this error? Perhaps because when they saw Amgen listed as HOT partner in the presentation they subconsciously didn't think anything of it because a deal is being finalized with Amgen.
Gb, it does seem odd that the Amgen HOT partner reference would be inserted on the slide out of nowhere...unless it wasn't out of nowhere but accidentally inserted before the public announcement in September. We'll see. I think it's likely we'll see a deal announced in the next few weeks.
If Affimed is any indication, you should be back above your DCA when they announce a deal on HOT.
Or it could be a Freudian slip.
Jc, I think the most comparable situation to HOT is NEO in which ADXS got $40m in upfront cash with no data.
"With some data, they'll be able to command orders-of-magnitude more cash in any partnership deal."
You sure about that? That's what O'Connor thought about AXAL, look how that turned out.
Interesting reference to Amgen as our new HOT partner. Did ADXS just accidentally communicate pending news on HOT deal to be announced next week? Affimed is now up to $6.90 from $1.60 on Monday. Show us what you have Berlin.
Affimed 6.50 +0.95 (+17.12%)
Get it done Berlin. ADXS is later stage and worth more than Affimed.
The point is the reason the stock value has shrunk so much and now below the warrant exercise price is largely a result of Dan O'Connor acting unethically to line his pockets throwing investor interests aside all while executing a weak business strategy that wasted a lot of capital, then when he was finally canned, the extent of his damage was made clear to the market and the Board stood flat footed without a succession plan and put a retiree in as interim CEO for nearly a year which destroyed that much more value. The morally right action would be to extend the warrants because LTSHs who bought warrants long ago are being penalized for management and Board poor and self-serving business decisions.
The next few weeks will be very interesting. Berlin is setting up for...hard to tell exactly what, but my bet is a monetary deal on either HOT or AXAL.
Affimed, which is uncannily similar to ADXS (in share count, market cap and price yesterday, recent $2 offering, etc.) closed yesterday at $1.60 and today after the Genetech deal closed at $5.55 (and is at $5.85 after hours).
Let's see what Ken delivers. I had pretty much written the warrants off at this point, but more hopeful now they could be in the money by the October 15 expiration. We'll see.
The similarities to ADXS are interesting. Similar shares outstanding and prior to today share price of $1.60, now. $5. Get it done Ken.
Current Price $5.00
+$3.40 (+212.50%)
Shares Outstanding
62.39M
Nice find. Notice the similarities to ADXS "Germany’s Affimed has struggled to catch the wave of interest in immuno-oncology drugs, causing its market cap to slip below $100 million."
IMO Ken is about to announce a partnership. The signs are there. For the first time in the company's history, several of our execs and Board members recently made open market purchases of the stock with their own money (not free O'Connor RSUs or salary increases to fund small monthly purchases but large purchases of the stock with their own money on the open market). Also, in recent months short interest has come down to a near record low. It's for good reason, smart shorts know that the risk of shorting now at such an undervalued level is very high (e.g., shorting at $1.50 and seeing the stock trade back to $10 on a deal would be very painful). Time will tell. GLTA
____
Genentech is handing over $96 million (€82 million) in upfront and near-term payments to work with Affimed on NK and T cell engagers. The deal features $5 billion in milestones and royalties that could land in Affimed’s bank account if the immunotherapies succeed.
Affimed has built its business upon a platform that generates multispecific NK and T cell engagers. The drugs are designed to redirect innate and adaptive immune cells and thereby orchestrate attacks on tumors. For example, Affimed’s lead candidate AFM13 is a bispecific antibody that binds to CD30 on tumors and to CD16A to recruit and activate NK cells.
Germany’s Affimed has struggled to catch the wave of interest in immuno-oncology drugs, causing its market cap to slip below $100 million. But Roche's Genentech likes the look of the platform and has reignited interest in the company.
Agreed Hovacre, all this negativity is premature. As Mark Twain said, "The rumors of my death have been greatly exagerrated." The last I checked ADXS is still a late stage company with an ongoing Phase 3 trial in cervical cancer.
Agree, folks are projecting the past mismangmemt of O'Connor to Berlin. Berlin is honest, smart and competent in business strategy, three things O'Connor was not. I wouldn't be surprised to see a deal announced soon.
Could be a smart move. Debt is preferable to equity at the current artificially low stock price that doesn't reflect the company's value, because equity is dilutive while debt is not. Issue debt now to make sure we have a year of cash then issue equity later when the stock is higher.
Let's see if they announce a deal shortly. It would make sense to reregister the shelf first if they plan to announce a deal that gets the stock price back up them sell some shares.
Are you kidding? The stock price is where it is because O'Connor's reckless spending and misguided strategy was on path to drive the company into the ground. That is why he was fired, which was final confirmation the market needed that he had mismanaged the company and its finances. With the exception of Amgen, all his deals were weak giveaways with no money upfront. The final nail in his tenure was when, after alluding to a Europe deal, came to the spring 2017 annual meeting empty handed delivering nothing of value AND pushed through another shareholder unfriendly non-performance based bonus policy for management with auto escalations not needing shareholder approval. Over 40% of our shareholders voted against it (which is a huge number considering most almost always default to management recommendations), then we saw the mass exodus of our institutional investor base. And here we are hovering around the all time low stock price and valued at little more than cash, astonishing for a late stage company.