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I'm Counting 19 Fewer Authors Than in 2018.
Thank you so much, CrashOverride, this is an awesome contribution to our collective due diligence.
I counted 50 names here, and I counted 69 names in the list of authors in the 2018 article in Journal of Translational Medicine reporting preliminary results of the phase 3 trial.
I'm wondering what, if anything, that may mean?
I'm also noticing that Dr. Steven Brem has moved up the list considerably, from 29th place in 2018 to 3rd place today.
Again, does anyone have any idea what this may mean? I'm interested because I live outside Philadelphia and the University of Pennsylvania (where Dr. Brem works) is one of my favorite schools.
It also may mean this story (when it finally breaks) may be picked up by our hometown newspaper, the Philadelphia Inquirer.
So glad to see enforcement actions taking place.
This link will take you to an August press release from the Department of Justice related to the conviction of 2 Wall Street traders who were charged with fraud, market manipulation, and spoofing.
This news seems relevant in light of recent posts on this board that manipulation of the share price for NWBO may have occurred on May 10, 2022 during the presentation of phase 3 clinical trial results at the New York Academy of Sciences.
https://www.justice.gov/opa/pr/former-jp-morgan-traders-convicted-fraud-attempted-price-manipulation-and-spoofing-multi-year
What about the obligatory line from LP: "We thank shareholders for their patience." ???
These are awesome, HankMan. Thanks for playing!
Slight revision to my haiku (just adding a title):
Poor Man's Lament
Shares at sixty-two
Volume keeps on falling down
My wife strangles me
-- OJ (AKA wolf, buttercup, verucca)
Agree!
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Still working on your list of NWBO oddities.
Right now there are 6 items on my list. The more I ponder and reflect, the longer grows the list.
If you could give some thought to the question I posed to you earlier, I'd be interested in your perspective. You're a good writer and a deep thinker with a logical mind, so perhaps some others on this board might be interested, as well.
-- OJ
List of Recent Submissions to NCCN CNS Panel
Source: https://www.nccn.org/guidelines/submissions-request-to-the-guidelines-panels/submission-request-history
Defibrotide Sodium Submitted by Jazz Pharmaceuticals Inc. on 11/27/2017
Osimertinib Submitted by AstraZeneca on 04/19/2018
Bevacizumab Submitted by Munson Medical Oncology on 05/02/2018
Glucarpidase Submitted by BTG International on 09/13/2018
Regorafenib Submitted by Bayer HealthCare on 12/10/2018
Osimertinib Submitted by AstraZeneca on 01/17/2019
Neratinib + Capecitabine Submitted by Puma Biotechnology on 04/05/2019
Vitrakvi Submitted by Bayer HealthCare on 05/28/2019
Neratinib + Capecitabine Submitted by Puma Biotechnology on 06/10/2019
Nivolumab + Ipilimumab Submitted by Bristol-Myers Squibb Company on 06/18/2019
Bevacizumab-awwb Submitted by Amgen Inc. on 07/19/2019
Entrectinib Submitted by Genentech, Inc. on 08/15/2019
Osimertinib Submitted by AstraZeneca on 04/14/2020
Tucatinib Submitted by Seattle Genetics, Inc. on 04/17/2020
Selumetinib Submitted by AstraZeneca on 05/04/2020
Selumetinib Submitted by AstraZeneca on 05/04/2020
Tucatinib Submitted by Seattle Genetics, Inc. on 05/29/2020
Aminolevulinic acid hydrochloride Submitted by NX Development Corp on 06/02/2020
Pembrolizumab Submitted by Merck & Co., Inc. on 06/17/2020
Nivolumab + Ipilimumab Submitted by Bristol-Myers Squibb Company on 06/23/2020
Tumor Mutational Burden (TMB) Submitted by Foundation Medicine, Inc. on 06/24/2020
Laser Interstitial Thermal Therapy (LITT) Submitted by Washington University School of Medicine; Department of Neurological Surgery on 08/28/2020
Tumor Mutational Burden (TMB) Submitted by Foundation Medicine, Inc. on 09/18/2020
Capmatinib Submitted by Novartis Pharmaceuticals Corporation on 12/11/2020
Nivolumab + Ipilimumab Submitted by Bristol-Myers Squibb Company on 06/04/2021
Selpercatinib Submitted by Eli Lilly and Company on 06/16/2021
Belzutifan Submitted by Merck & Co., Inc. on 08/19/2021
Nivolumab + Ipilimumab Submitted by Bristol-Myers Squibb Company on 09/09/2021
Tepotinib Submitted by EMD Serono on 09/13/2021
Fam-trastuzumab deruxtecan-nxki Submitted by Daiichi-Sankyo, Inc. on 09/22/2021
Agree that an RA approval would help. Do not contest that point at all. Thanks Hoff for the reminder.
However, we need to be clear that, as a private, non-governmental organization, completely independent of the FDA, NCCN is free to recommend therapies for off-label uses.
It doesn't happen often, but it does happen.
My next post will contain a list of all submissions to the CNS panel in recent years. As you will see, this is a game the big boys play.
-- OJ
AEK:
If you're looking for a list of items that might move the share price upward, I'd add to this list some recognition of good, old-fashioned sales revenue on the 3Q income statement, presumably generated by sales of doses produced at the Sawston facility. Given the fact that the company PR'd the start of production at Sawston in February, I thought this would be a sure thing on the Q2 report. Silly me.
Also, after the peer-reviewed journal article comes out, I think it's quite reasonable to expect a number of follow-on or follow-up articles to be published in other publications. I'm thinking in particular of The ASCO Post, which is near must-reading for everyone in the clinical oncology community. The appearance of a full-length feature story in The ASCO Post I think would be widely regarded as major progress and help the share price move up.
I know for a fact (through personal communication) that editors there are 1) aware of the NYAS data presented by Dr. Mulholland and 2) waiting to print anything until after they've seen a full report of the phase 3 clinical trial in a peer reviewed medical journal.
Finally, if you're looking for an event that could REALLY be expected to move the share price upward, I'd include this: addition of "autologous tumor lysate-loaded dendritic cell vaccination" as a treatment option on page GLIO3 of the Central Nervous System (CNS) clinical practice guidelines published by the National Comprehensive Cancer Network (NCCN). GLIO3 shows the treatment algorithm for patients with newly diagnosed GBM.
The cherry on top, the icing on the cake, would be the addition of "autologous tumor lysate-loaded dendritic cell vaccination" to page GLIO5 of the same guidelines. On that page, treatments for recurrent/refractory GBM are recommended.
Why would these changes to NCCN practice guidelines move the share price, you may ask? Answer: because NCCN guidelines help set the standard of care for treatment of a wide variety of solid and liquid tumors not just in this country, but around the world. They do this because the guidelines are updated frequently, and they are available as a free download anywhere in the world, and they are often translated into foreign languages.
And here's another reason: many private health insurance companies in the United States determine whether they will reimburse for a new treatment based on whether Medicare reimburses for it. And Medicare normally makes coverage decisions based on whether the treatment in question appears in the NCCN guidelines.
The CNS panel's next regular meeting is in October. The chair of that 32-member panel is aware of the Mulholland/NYAS data. It's possible, if a peer-reviewed journal article appears soon, that NCCN guidelines will be updated this fall. If not, it may be next fall until they are updated, since guideline panels normally meet only once a year barring major changes to clinical practice necessitated by therapeutic advances. In a best-case scenario, the CNS panel might hold a special, interim meeting to discuss the phase 3 trial data published in the peer-reviewed journal article, and the CNS guidelines could be updated shortly afterward, perhaps in the winter of 2022 or spring of 2023.
Hope this helps.
Thanks AEK for all you do to keep us up-to-date!
Good luck to all.
-- OncoJock
Fair enough, Ex. To be honest, I'm still trying to figure out my point. It's just a fuzzy hunch right now, that things might be better with an oncology physician in the mix among top management.
Hoff says I'm being illogical, and has asked me to be more specific about the oddities I've observed related to NWBO. I'm working on a list for him, it has 3 items on it as of today. I will have more to say later, need to get back to my day job.
Best,
-- OJ
BTW thank you for all your expert input with respect to regulatory approval processes.
A very impressive list, to be sure. Thank you for sharing.
Great question! I'm working on a response in a related post by Hoff, but I'm still a working stiff so I need to put this on hold while I get some other work out the door today.
Meaty discussion topic, though.
Hold that thought!
Best,
-- OJ
As I compile my list of NWBO oddities in response to your question, let me ask you this question:
Why do you suppose many small biopharmaceutical companies choose to recruit, hire, and pay good staff salary to a physician, and sometimes also give him or her the title of chief medical officer, and include him or her within the ranks of top management?
It's quite common. Here are some examples, taken from my post of August 1:
Halozyme Therapeutics https://halozyme.com/about-us/#leadership (CEO is a physician who trained in the UK.)
Nektar https://www.nektar.com/company/our-leadership (Senior leadership includes a physician who serves as chief medical officer.)
Iovance https://www.iovance.com/management/ (Chief medical officer is a physician.)
Oncocyte https://oncocyte.com/about-us/leadership-advisors/ (Chief science officer is a physician, so is chief technology officer.)
Kura Oncology https://kuraoncology.com/about/#leadership (Leadership team includes a physician as chief medical officer.)
Best,
-- OJ
Here is when we get into the nitty gritty differences between PhD-type doctors and MD (or MBBS)-type doctors.
The doctors I'm talking about are the MD (or MBBS)-type doctors, that is, physicians. I'm talking about clinicians who care for patients. Those types of doctors.
To the best of my knowledge, there are no physician-type doctors, or retired physician-type doctors, or former physician-type doctors, among top management at NWBO. And this is what I find odd. It's definitely not the norm for small biopharma companies.
Don't get me wrong, there are several PhD-type doctors, or JD (juris doctor)-type doctors, among top management. And I'm sure they are very smart. For example, I've attached here a screen shot taken from the LinkedIn profile of Marnix Bosch, PhD, MBA. My point is that "Dr. Marnix Bosch" has never actually practiced medicine. This means he has never actually cared for patients. Unless, in the Netherlands, you're allowed to practice medicine with a PhD.
I'm not arguing that Marnix Bosch is anything less than a wonderful, intelligent, hard-working and well-meaning individual. I am arguing that Marnix Bosch has never practiced medicine. I'm also arguing that, on the basis of my research on LinkedIn and the corporate website, there is no one on the top leadership team who has ever practiced medicine.
If I'm wrong (and I hope I am), please correct me.
I'm focusing on this issue because I think it may help explain some of the odd things that have happened lately.
Here (between the rows of asterisks) are the questions I asked. I'll leave it to you to decide whether they are leading, or inappropriate in some way.
********************
Could you please tell me when will the next annual shareholders meeting take place?
When will the company issue a press release reporting final, unblinded results of the phase 3 trial of DCVax-L in glioblastoma?
When will the company issue a press release with details regarding the recently authorized Series C preferred stock? Why was the stock series filed with the SEC but no press release issued that speaks directly to the interests of prospective investors? This seems odd to me.
When will the company end the quiet period?
Why was the quiet period needed in the first place?
Why is the company issuing some press releases during the quiet period, but not others? This seems confusing to me.
What is the status of publication of a final report on the phase 3 trial in a peer-reviewed journal? The paragraph of text that spoke to this issue in previous quarterly reports was omitted from the most recently quarterly report (10-Q) filed with the SEC. Could you please explain why it was omitted?
Does the company have plans to submit a request/suggestion to the National Comprehensive Cancer Network for the use of DCVax-L in patients with newly diagnosed and recurrent GBM?
On the most recent quarterly filing with the SEC, there is no line item reflecting sales revenue from doses of “specials” or compassionate use vaccinations given to patients during the second quarter. But early this year the company issued a press release proudly announcing that production had begun at the Sawston facility. If production is underway there, how come no sales revenue is being generated?
Finally, why does Northwest Biotherapeutics not have a physician on staff who serves as chief medical officer? Most other small biopharmaceutical companies have a person on staff who holds a medical doctorate (MD or MBBS, etc.) who is a salaried employee and who carries a title such as “chief medical officer” and is a member of the top leadership team, or in some cases is the CEO. Has Northwest Biotherapeutics ever had a chief medical officer (CMO)? Perhaps there is some history that I’m not aware of. Are there any plans to bring a CMO on board? I find it odd that Northwest Biotherapeutics does not have a CMO.
****************************************
- OJ
Agreed. But it just seems a bit odd for him to not explain the reason for the brevity of his reply, or not apologize for such a brief reply, or not say that he'd get back to me when he had more time. His job is to generate and maintain good will, right?
My list of questions included many that other investors have, as I know from reading posts on this board.
As I thought about it more, his odd response may say more about him than it says about me. I'm wondering how is David Innes feeling right now, working for a company that's on very thin ice, financially. Is he wondering about his future? Starting to look for employment elsewhere? Or perhaps they're so short-handed he's been pulled off his regular duties to lend a hand with other work for which he's ill-suited. We just don't know, so I'll try to extend just a little forbearance. (Something I need to practice.)
Agree. Don't get me wrong and think I'm totally pessimistic.
The science (historic breakthrough with statistically significant efficacy improvement over the current standard of care and a remarkably benign safety profile in a phase 3 trial) remains a very bright spot and a reason to continue holding shares, IMHO.
No apology necessary, Poor Man. I don't blame you, I blame NWBO management for not issuing a press release to accompany the SEC filing for the C shares. I hold shares in another biotech that just issued $625 million in convertible senior notes, and trust me they didn't just notify prospective investors via an SEC filing.
I really appreciate the way both you and Bright Boy used your smarts, savvy, and previous experience to come up with a smart rationale for the new C shares, even though your theory didn't turn out to be entirely accurate.
Another thing I really appreciate about you is your sense of humor. I have really laughed out loud a couple of times as I imagine you living in a public park, sleeping on a park bench, and posting to iHub on a portable device with one hand as you dodge traffic and panhandlers.
So please don't take it personally when I call NWBO's filing of the C shares with the SEC a poor man's press release (!)
Please keep posting and sharing both your savvy and your sense of humor with us!
Thank you, Hoff, for this optimistic and apparently realistic regulatory approval scenario.
However, it is just that, a scenario. Unless I missed a press release, we don't actually know if NWBO is taking this approval pathway. We are in the dark. I appreciate your upbeat position, but I must confess to feeling discouraged, frustrated, and anxious due to recent events, esp. in light of info contained (or not contained) in the latest quarterly report.
Discouraged, because like many of you I did not see any sign of revenues from sales of vaccines produced at Sawston, despite a press release from February announcing with great fanfare that production there had begun.
Discouraged, because the quarterly seemed to dash my high hopes, raised by Poor Man, Bright Boy, and others, that the C shares would be sold for more than the market price as a way to wrest pricing power away from unscrupulous market makers who seem to be successful at manipulating the share price to keep it artificially low.
Frustrated and even a little bit hurt/humiliated, because when I wrote a long, courteous email to David Innes, asking for information, guidance, and clarity on half a dozen similar issues, he sent me back, within just a few minutes, a terse response merely stating that a shareholders meeting would be held before the end of the year. He ignored all my other questions, and gave no indication he would ever answer them. So I feel a little stonewalled.
Anxious/fearful since it's clear the company is running out of money, desperate for cash. The burn rate appears to be accelerating, with no sales revenue to even partially offset it. Fortunately Advent appears willing to continue accepting shares in lieu of cash as payment for services, but if I were Advent, I'd begin to wonder if I might be better off selling those shares right away.
Also anxious/fearful due to lack of an employee on staff (and within the top leadership circle) with title of chief medical officer. Clearly, the lack of a CMO is a departure from the norm for small biopharmaceutical companies.
And then the other unanswered question, in my mind, is where on the income statement are the expenses associated with obtaining patent protection in many different foreign countries. You (Hoff), and HenryMuney, Lykiri, and others, have been so very friendly/generous/forthcoming by sharing with us your discoveries of various patents being issued in countries like Israel, Russia, Singapore, Japan, (if memory serves). Last I checked, hiring the services of a patent attorney is not cheap, much less one who works in Tokyo. Where are those expenses being disclosed? Maybe this is a little thing and I shouldn't get too concerned.
In any case, thank you Hoff, for your optimism. Again I agree ILAP looks like it would be a marvelous way for NWBO to go. But it just seems like more wishful thinking. For myself, I feel more like Poor Man just described his feelings: unwilling to extend the company the benefit of the doubt any longer, at least not until they spell out in clear terms what they are doing, what we shareholders can expect. The absence of a press release associated with the C shares -- a corporate announcement of some kind that speaks clearly, plainly, and directly to interested prospective investors -- speaks volumes.
I love the idea of a quarterly earnings call. We can dream, can't we?
-- OncoJock
Leverage is a good thing, right? (Better than a dilutive offering of more common stock as a way to raise cash for corporate purposes, to my way of thinking.) And a larger stock buyback is also a good thing, right? And this also may mean that everyone who lends the company money on these terms will be actively in favor of the stock price rising to at least $56, or higher, in coming years. If some of those lenders are also major investors, it could help prevent those investors from driving the share price down by selling.
What confuses me, however, is how HALO issued 2 press releases on the very same topic, on the very same day, with the only difference I could see being the size of the offering. At first it was $500 million, then it became $625 million. Seems strange they would not have their act together enough on a financing as large as this one to have waited until they had the amount nailed down before issuing the press release. Or perhaps I'm missing something.
The other thing I noticed was that something similar happened in February of 2021, where on 2/23/21 they announced an offering of $500 million in convertible notes, and then 2 days later changed the amount to $700 million. It just seems weird that they would change their minds on such a big, important topic at the last minute.
Or am I missing something? Maybe this happens all the time. An expert in corporate finance I am not. (But I have written A LOT about advances in cancer medicine in the past 10 years.)
The only other thing that gives me second thoughts right now is how they seem to have traded down in terms of their CFO. The previous CFO, as I recall, went to Wellesley to earn a BA in economics and then earned an MBA at Harvard. It doesn't get any more blue chip than that. But Elaine Sun left in February, and the new CFO, while certainly qualified, doesn't seem to have the broad, 30,000-foot perspective and the gold-plated academic credentials as her predecessor. A BS in corporate finance and an MS in accounting from Bentley College (wherever that is, never heard of it before) doesn't inspire the same confidence in Nicole LaBrosse as the Wellesley/Harvard MBA combo did in Elaine Sun.
(Sorry if I sound stuck up. Maybe I should have picked OncoSnob for my username on iHub.)
-- OncoJock
Same to you. And thank you for your service as our volunteer moderator.
Agreed. After studying Halozyme's development pipeline, I'd been watching for news of that Tecentriq/atezolizumab trial for many months, with great anticipation. In my view, these trial results are very bullish for two main reasons: 1) the large worldwide prevalence of non-small cell lung cancer (it's the most common subtype of one of the most common tumor types, roughly 85% of all lung cancers are NSCLC), and 2) the global reach of Hoffman-La Roche. Atezolizumab is Roche's main answer to Merck's Keytruda/pembrolizumab and Bristol's Opdivo/nivolumab. So, for Roche's flagship immune checkpoint inhibitor to now have a competitive advantage in terms of ease of administration (SC versus IV) thanks to HALO's Enhanze technology, is a very big deal, at least in my view.
Like you, Fred, I've been mystified several times in the recent past how Halo's stock price has suffered upon release of good news. Seems like this is another example of that.
The only potential fly in the ointment with respect to the good news on the phase 3 trial, in my view, was the relatively minor reduction in administration time. As I recall, the press release told us the SC formulation takes 3 to 6 minutes to administer, compared to the IV formula which takes 30 to 60 minutes. While this is an increase in convenience to be sure (for both patients and clinicians) it's not the huge increase we see with daratumumab/hyaluronidase (Darzalex Faspro). As I understand it, IV daratumumab must be infused over a much longer time period (6 to 8 hours if memory serves) to prevent infusion reactions, so the time advantage of the SC route is of a much greater magnitude.
Nonetheless, for Halo to have an A-list collaboration partner like Roche, and to deepen that relationship still more (since Halo and Roche or Halo and Genentech [a Roche subsidiary] are already collaborating on other agents) seems to me a really big step forward for the company. Again, I cannot fathom the sell-off in HALO share price the past few days.
I'd buy more shares if I had more cash.
Update on Headwinds Slowing CDMO Business at CRL
Here's a detailed and timely look at how Charles River Laboratories (CRL) is encountering difficulties integrating its recent acquisitions of 2 contract development and manufacturing organizations (CDMOs), namely Cognate and Vigene, causing CRL to miss earnings targets, at least temporarily. CRL stock price is down about 10% this morning.
https://ir.criver.com/static-files/9a616c57-5c55-4bcc-a2fb-b46dd0f50630
See especially pages 10, 11, and 12.
Any comments from biosectinvestor, ATLnsider, flipper44, or other savvy iHubbers on how CRL's difficulties may, or may not, be relevant to us as NWBO shareholders?
The Risks We Face As NWBO Investors, continued
Dear Kaizenman:
You are welcome. And thank you for taking the time to share your experience and knowledge with a newcomer like me. I note with interest that you’ve written 700 posts on this board since September of 2020, and I’ve written fewer than 20 since I stated posting last month. It’s amazing to see that there are now more than half a million posts on this board!
Let’s continue our conversation in a way that helps others to listen and learn along with me.
(For those of you just joining us, Kaizenman originally asked me to explain my concerns about the risk of investing in NWBO. A paraphrase of each of my original concerns is shown in quotation marks next to the numbered paragraphs below. The black text outside quotation marks is Kaizenman’s response to me, and the text in red is my response to Kaizenman.)
1) “Evidence of naked short selling and lack of enforcement/protection by SEC regulators.” This is an issue for pre-revenue companies with little to no prospects for becoming a financially viable entity. For $NWBO this becomes an investor’s judgement call if they will become financially viable. My perspective is that approval with the MHRA is highly likely, and soon, thus I am not worried about the naked shorting since I have shares in my account and have not shorted.
Agree with you that MHRA approval is likely, given the company’s stellar track record to date at Sawston. But not sure I understand how you holding shares in your account and not selling short protects you, or anyone, against naked short selling by others, or by groups of others in an organized, coordinated attack. BTW, Mr. Baxendale has offered to help me with obtaining factual data from the SEC website on FTDs (fails to deliver) but I have not had time to take him up on the offer. I have encouraged him to post a link to his data here, on iHub.
2) “Widespread allegations of market manipulation/orchestration of price movement.” The fact that the stock trades on the OTC exposes the stock (and all OTC stocks) to higher risks of this action. For me, I must see a path to gain more share price upside to counter-act the risks of this. Thus, I have included a premium return in my valuation and share price computation to counter-act this risk.
I agree in general that there is a path to a significant share price upside. That’s a big reason why I’m holding! Could you please explain more about the premium return in your valuation that you have included as a way to counteract this risk?
3 & 4) “Management expertise is concentrated in only a few people …” (LP & JJ). The risk is not that a handful of people have the expertise, but if there is no “back-up plan” for developing and retaining the knowledge and expertise. Since I am unable to identify a back-up plan and strategy in my DD, I have this as a risk.
It appears that we are in agreement on this issue.
5) “There is a noticeable lack of physicians among members of the top management team.” I do not necessarily consider this a risk to the investment. Even if it were, a previous posting regarding Dr. Liau and Dr. Ashkan (as well as any of the other many Oncologists that participated in the DCVax-L study) can be contracted to provide this expertise as needed. Dr. Liau was recently appointed to the Board of ClearPoint Neuro, and $NWBO could do something similar if need be.
Agree that it’s not really a direct risk to the investment in the same sense as other items in my original list. But in my mind I keep coming back to this (the lack of physicians among top management) because I think it may help explain some the more puzzling episodes in this company’s history. I would just point out that Dr. Liau’s primary allegiance is to her institution/employer (UCLA) as well as the profession of medicine, and Dr. Ashkan’s primary allegiance is to University College London (UCL) as well as the profession of medicine.
Sentiment_Stocks has pointed out to me in a separate post that NWBO has a scientific advisory board, as well as a trial steering committee, and both of these bodies are populated with prominent physicians, not the least of whom is Stephen Brem, MD, a neurosurgeon and professor at the University of Pennsylvania. I must concede that Senti makes a good point, these advisors may reduce the size of the blind spot I described earlier. However, there remains quite a contrast between the top management team at NWBO and the top management teams at other small pharma and biotech companies. When I read the “About Us” tab on the websites of other small biotechs, I nearly always see the bio of a person who is, or was, a practicing physician with a doctor of medicine (MD) degree, who is employed by the company, and who has a staff title similar to “chief medical officer.” Here are some examples:
Halozyme Therapeutics https://halozyme.com/about-us/#leadership (CEO is a physician who trained in the UK.)
Nektar https://www.nektar.com/company/our-leadership (Senior leadership includes a physician who serves as chief medical officer.)
Iovance https://www.iovance.com/management/ (Chief medical officer is a physician.)
Oncocyte https://oncocyte.com/about-us/leadership-advisors/ (Chief science officer is a physician, so is chief technology officer.)
Kura Oncology https://kuraoncology.com/about/#leadership (Leadership team includes a physician as chief medical officer.)
I could go on, but it really seems to be the norm for small biotechs to have at least one physician with the title of chief medical officer on the senior leadership team (not just on an advisory board).
6) “Risk of competition is growing. If the wider use of external control arms makes it easier for NWBO to win regulatory approval, it will do the same for competitors’ drugs.” My DD has not found any trial that is close to reporting study results treating GBM as a new SOC. It is possible that I may have missed said trials, but I don’t think so. There are many studies trying to tweak the existing SOC to get a minor improvement. In addition, given the redefinition of GBM and the extremely large population of sample sizes over the years for placebo control groups, this risk is very low. To put it simply, once you are diagnosed with the redefined GBM, there is a pretty tight window in which you will die. Period. This ECA point will become much more relevant if used for DCVax-Direct for many other indications.
Thank you for sharing your due diligence regarding clinical studies of competing agents. You’ve reassured me.
7) “Human error during manufacturing.” The control for this is GMP compliance and manufacturing certification. I believe in the assessment, processes, verifications, and controls mandated by these certifications to not only minimize human error, but also machine and environmental risks.
I believe in the value of these processes, verifications, and controls, too. Again, we seem to be in agreement.
8) “Other legal proceedings are already underway, especially the shareholder lawsuit stemming from the “true-up” executed by management before I became a shareholder.” It is a risk however, given the process to “true-up” was approved by shareholders ahead of time, the risks of judgement against $NWBO is low.
True. I remain concerned that for top management to defend against these allegations may be a drain on precious time, talent, and treasure that could be better spent moving the company forward toward manufacturing and marketing approvals in the UK, and then in other regulatory jurisdictions after that, perhaps using the Project Orbis framework that ATLnsider mentions so frequently.
9) “NWBO is a one-trick pony. Its product line is not diversified.” I am not sure you understand the history of the company or what NWBO has developed given this risk statement. Given the potential number of indications that can be treated with DCVax-L and DCVax-Direct for both humans and animals, this is not a risk to me.
I see your point about the potential wide application of this platform technology to a variety of solid tumors, and I do not dispute that promising potential. But it is only that: potential. And we have many miles to go before that potential is realized and many things could go wrong along the way. I guess I’m comparing NWBO to larger, broadly diversified pharmaceutical companies (Merck, Bristol, Novartis, Genentech, AbbVie, Astellas, Takeda, Lilly, Janssen, etc.) with much broader and deeper R&D pipelines involving multiple agents currently in phase 2 and 3 clinical trials in hematology/oncology. I’m thinking about risk.
To use my favorite analogy of prospectors during a gold rush, would you rather invest in a large company with multiple gold mines and a track record of bringing a lot of that refined ore to market over many years, or in a single tiny prospector with just one mine, who may or may not strike gold, and who has never actually sold fully refined ore in large quantities on the precious metals market? I prefer to spread my risk, rather than concentrate my risk. But then, as you rightfully point out, each investor needs to make his or her own risk tolerance decision.
10) “Competition for qualified technicians can be cutthroat.” Currently, this is pervasive in the cell and gene therapy field now. As more and more products are made there will be more qualified employees to draw from in the future. Once the Flaskworks EDEN system is approved for manufacturing (likely within 1 year), the risk to contract mfg and NWBO will be greatly reduced.
We differ on this point. When you write, As more and more products are made there will be more qualified employees to draw from in the future, you leave out a crucial step: workforce training and development. Actually I think the opposite of what you stated is more likely true: As more and more products are made, the competition for qualified employees will only increase from here, and finding and retaining them will only become more difficult. Moreover, as technology changes faster and faster, the challenge to find people who can teach and train the next generation of workers in the cell and gene therapy industry becomes more difficult. Simply put, everyone who is bright, learns quickly, and knows what they’re doing can make way more money in industry than they can make in academia. No qualified faculty = no qualified students/trainees. There’s really no guarantee that as the cell and gene therapy industry grows, a trained and qualified workforce will somehow materialize and be ready to support it. Despite your reassurance, I continue to list the shortage of qualified employees to help with manufacturing/production as a major risk/headwind for NWBO.
11) “Who would want to go to work for a company, and seek to make a career with that employer, when that company is openly trying to avoid having human beings on the factory floor?” I think there will be many people that will find tremendous job satisfaction on saving lives supporting the manufacturing and distribution of DCVax-L. The need for employees will always be there in the manufacturing and distribution of DCVax-L, the difference is the duties needed to be performed by humans will continue to reduce in this field (as in every other field in the economy).
Please see my response to #10 above. Who will teach the human beings these duties? And how will the teachers get far enough ahead of such fast-changing (and closely held) technology to be able to turn around and teach the next generation, who need and want these skills?
12) “Financial risk.” This is always a risk for pre-revenue companies. I am comfortable with the current situation, primarily because there is revenue being booked from the specials program. I also believe there are still enough “Angel Investors” out there if needed to get DCVax-L over the automation hurdle.
Glad to hear about the revenue from the specials. I’ll be sure to look for it in the next quarterly report to the SEC, due soon.
13) “Regulatory delays are par for the course. Does NWBO have the financial stamina to withstand one or more regulatory setbacks.” I believe yes, see answer to Risk #12.
Hope you’re right. Maybe proceeds from sales of C shares will help.
14) “NWBO has an unpleasant history of dilutive financings.” See recently released 8K. Either you believe they are going to use their designated Series C constructively or not. I believe the next round will not be “excessively dilutive”. Each investor must make their own decision.
Agree, but I just wish to say for the record how very odd these series C preferred shares appear. First, they carry voting rights. Second, they pay no dividend. Third, they cannot be sold without permission of the board of directors. Definitely not your average, plain vanilla series of preferred stock.
15) “NWBO is traded over the counter (OTC) and its chances of ever “graduating” to a national exchange like the NASDAQ are slim.” There is risk for companies on the OTC. Each investor must decide if the company has a clear pathway to generate enough revenue and profit over time to up list or get bought out. I believe in the projected revenue computations I have assembled to rank this risk of this very low for me.
OK since the odds are so slim, maybe this means that we have to reconcile ourselves to the prospect of NWBO trading over the counter indefinitely, or at least until purchased by a large pharmaceutical company. Sigh. Not a pleasant prospect, because it reduces the chances of major institutions – pension funds, university endowments, etc. – from ever investing a large chunk of money to support the company’s growth (which might also boost the share price).
GLTU. Peace.
Thank you Kaizenman, same to you.
Good question, Gary.
From my previous experience as editor of a peer-reviewed journal, I'm pretty sure it's just the authors, or perhaps just the corresponding author, who receives any advance notice prior to publication. And then, it's when the journal publisher asks the corresponding author to sign off on the page proofs. Usually, when the journal editor (or sub-editor) asks the corresponding author to sign off on the page proofs, the journal editor also gives the corresponding author a sense of when publication will take place. I wouldn't expect the company to be in this communication loop at all, unless perhaps the corresponding author notifies the company, in addition to the other authors, that publication has been scheduled.
An exception might come if the company places a reprint order with the journal. (As many iHub readers will know, reprints are a major profit center for medical journals, including the New England Journal of Medicine (NEJM). If the company has decided to spend a lot of money and order a large quantity of reprints (to help with promotional sales efforts), then it's possible that the company might be asked to sign off on the page proofs of those reprints. But reprints are normally ordered and distributed well after publication of the original clinical trial report. There might possibly be an exception to this rule if the journal has arranged for publication of the article to coincide with a major medical meeting, so reprints can be distributed to people attending the meeting.
Please don't take this as gospel, however, because my stint as editor of a peer-reviewed journal ended in 2008, and things may have changed since then. And trust me, the journal I edited was NOT the NEJM.
If there are any other former editors of peer-reviewed journals reading this, and I am off base, please feel free to set the record straight.
-- OJ
Agreed, BB. It's a rookie mistake, common among interns and newbies in newspaper newsrooms around the country (if any are left).
In Journalism 101 you're taught to at least make one phone call to confirm what another news reporter for different publication has written before you repeat the facts in your own publication. That routine step was clearly not taken in this case, and it cost the AACR dearly in terms of credibility, as you point out.
However, as I've mentioned to Fireman, the AACR editorial staff never really admitted their error. They just posted an "update," not a true correction. To my mind, the new text was worthy of the term "correction" because of the 180-degree aboutface in the news value of the text: it went from a brief report on a failed trial to a brief report on a successful trial in a very important tumor type.
And, given the historic nature of the success, it really makes we wonder why the editor did not allocate more space to the trial results. Something just doesn't seem quite right with respect to publication of the phase 3 trial results in mainstream as well as clinical news media, and I can't put my finger on it.
Agreed, Fireman. I noticed the same thing. They (AACR publication staff) are really putting distance between themselves and the company's assertions. While the company may have asked for the correction, the company did not make the presentation at NYAS. One of the trial's investigators made the presentation.
In the second paragraph AACR could have deleted "The company believes" and just begun the sentence with "The presentation shows . . . ." or "Dr. Mulholland's presentation shows . . . ." It would have been a much stronger statement, and it would have been just as accurate.
The good news is: they provided a link to the full presentation. The bad news is, the tone of the text conveys a lack of trust in the veracity of the data.
It's better than before, but still not fully satisfactory, IMO.
This is an awesome, point-by-point response, Kaizenman. Thank you so much. Now I'm really glad I took the time to answer your question about risks.
You raise some terrific points and I will respond at greater length after I have served my paying customer whose slide deck is due tomorrow.
Since this is a public reply (I have not yet spent the money to upgrade so I can send private replies on iHub), thank you also to the 14 other people who have responded to my post about the risks we face when investing in NWBO. I will respond more selectively to you in the days ahead, since I don't want to clutter the board with messages that have limited relevance to the larger readership.
-- OJ
The Risks We Face Together As NWBO Investors
Dear fellow NWBO shareholders:
So, I realize that with all the excitement about the new Class C preferred shares few people may actually take the time to read this lengthy post. But in response to good questions from Kaizenman and Poor Man, some well-informed pushback from biosectinvestor, and even a little encouragement from sentiment_stocks to go ahead and ruffle some feathers so long as I avoid personal attacks and stay focused on NWBO, here are 15 risks that concern me right now.
Before I start my litany, let me assure you that I continue to hold shares. In fact, I’m more heavily invested in NWBO than in any other single company’s stock in our household’s investment portfolio. At today’s closing price of around $.68 per share, the portion of our nest egg devoted to NWBO shares is a little over 6%. My wife and I hold larger amounts in various funds, but the only other individual companies that come close are Medpace Holdings, at 4%, and Halozyme Therapeutics, at 3%. So I have skin in this game.
Also, let me concede David Innes' general point that the risk of investing in NWBO today is less than it might have been a few months ago, before we knew results of the phase 3 clinical trial of DCVax-L in glioblastoma multiforme (GBM). And, the prospect of a financially beneficial partnership appears stronger today than it did just yesterday. Nonetheless a prudent investor might say that substantial risks remain. Here are some of those risks as I see them. Together they explain why I have not put any more precious skin in this game since May 10.
1) Evidence of naked short selling and lack of enforcement/protection by SEC regulators. I have been hearing about this ever since March of 2021 when I first bought shares, but my concerns have continued to grow. This is especially true in light of new evidence I found in a June 16 tweet by @TommyBaxendale. Mr. Baxendale, who tweets from Taiwan, cites the SEC website and precise URL for the source of his information. In trying to confirm this info, I did reach the SEC website, and at the URL Mr. Braxendale specified I could download the SEC “Fails to Deliver” data for the first and second halves of May, but I could not open the spreadsheets on my desktop. I have written the webmaster at the SEC for help. Here is a screenshot of the graphic posted by Mr. Braxendale, which contains the data I have been trying to confirm. I’d also love to see data from the first half of the month, which would include the May 10 debacle at the New York Academy of Sciences:
2) Widespread allegations of market manipulation/orchestration of price movement. I had heard this might be a problem, and my concerns were confirmed when I filed a formal complaint with the SEC after May 10. (I also wrote my representative in the US Congress to request an investigation, but that's another story.) The SEC website requires complainants to choose from a dropdown menu of reasons for their unhappiness. Sure enough, one of the menu options was naked short selling. Another was orchestrated manipulation of security prices. Clearly, if the SEC sees fit to program its website to include these options for complainants, then these problems must be widespread, and NWBO is a potential victim.
3) NWBO is a very small company, and management expertise is concentrated in only a few people. What if Linda Powers, with all her Ivy League magna cum laude brilliance, falls seriously ill?
4) Jerry Jasinowski, a key member of the board of directors when it comes to advising on manufacturing, will turn 83 years old this year, according to Wikipedia. Mr. Jasinowski is a former president of the National Association of Manufacturers, and founder and president of the Manufacturing Institute (again according to Wikipedia). He’s a true visionary, famous for his “Dream It, Do It” campaign to address America’s manufacturing skills shortage by increasing training programs throughout the country. To my eye, the recent success of NWBO in ramping up production at Sawston bears the mark of Mr. Jasinowski’s genius, in addition to hard work and perseverance by Advent staff. However, Mr. Jasinowski’s health could fail at any time and leave the company without his expert guidance.
5) Speaking of guidance, there is a noticeable lack of physicians among members of the top management team. While top management expertise is strong on legal matters and venture capital (Ms. Powers, Mr. Goldman), science/technology/research (Dr. Bosch/Dr. Boynton), manufacturing (Mr. Jasinowski), investment banking/pharmacy(Dr. Malik) and international relations (Mr. Black), there appear to be no MDs in the top group. After researching the public biographies and formal training of all top execs and board members, I was unable to find even one who has ever practiced clinical medicine. I hope I’m wrong about this.
The lack of any physicians, or former physicians, on the leadership team gives top management a major blind spot as they try to steer the company. This opens the company to possible mistakes and missteps since, after all, it will be physicians who choose to prescribe DCVax-L for their patients, or not. And it will be physicians on the Central Nervous System panel at the National Comprehensive Cancer Network who will choose to add autologous tumor lysate-loaded dendritic cell vaccination to the treatment algorithm for glioblastoma, or not. And it will be physicians who, upon reading a report in The ASCO Post, the New England Journal of Medicine, the Lancet, or perhaps an accredited continuing medical education (CME) activity of the type I help to plan, will make the crucial decision to prescribe DCVax-L, or not.
The absence of clinical experience among top management may help explain the puzzling lack of research abstracts presented at major medical meetings, like the American Society of Clinical Oncology (ASCO), where an historic breakthrough on such a nasty, stubborn, and lethal tumor type as GBM would normally be welcomed with open arms as a research abstract presented at a plenary session. Instead, NWBO found it necessary to assume the more expensive role of exhibitor, spend a major amount of cash, and rent an exhibit booth for ASCO 2022. There wasn’t even so much as a virtual-only e-poster in the formal conference program. I’ve been helping to educate oncologists about advances in cancer medicine for more than a decade. Trust me, it’s the attitudes of their peers that physicians rely upon, not just the experimental data, when deciding whether to risk making a change in clinical practice. To fix this, NWBO needs to hire a physician as chief medical officer, add him or her to the innermost circle of leaders, and do it soon.
6) Risk of competition is growing. If the wider use of external control arms makes it easier for NWBO to win regulatory approval, it will do the same for competitors’ drugs.
7) Human error during manufacturing is always a possibility, especially with such a highly personalized therapy. Under Murphy’s law, if something can go wrong, it probably will. Namely, Patient A could receive dendritic cells meant for Patient B, a death or major adverse event could occur, and the company could be exposed to massive legal liability.
8) Other legal proceedings are already underway, especially the shareholder lawsuit stemming from the “true-up” executed by management before I became a shareholder. This seems like a wild card.
9) NWBO is a one-trick pony. Its product line is not diversified. While dendritic cell vaccines may well prove to be a platform approach that can improve outcomes in other types of cancer beyond GBM, the amount of time required for that to occur seems like it may extend well beyond the lifetimes of members of current management, esp. Mr. Jasinowski.
10) Human error seems particularly likely due to the shortage of skilled and qualified lab technicians who work in the fast-growing cell and gene therapy industry. Competition for qualified technicians can be cutthroat. It’s possible that NWBO could finally fill an opening after an extensive search only to have the incumbent poached by another, larger company that is able to offer better salary and benefits. Then a newbie replacement could be thrown onto the job quickly (to keep up with prior production commitments) and mistakes could happen.
11) Speaking of human resources, I have been wondering this: Who would want to go to work for a company, and seek to make a career with that employer, when that company is openly trying to avoid having human beings on the factory floor? Who is going to want to make a major, long-term commitment to a company that owns a brilliant, disruptive technology like Flaskworks, that is explicitly designed to fully automate production of cell and gene therapy? It seems like NWBO will need to hire people who are really smart in one area (science and laboratory techniques) and really dumb in another (their own long-term self-interest).
12) Financial risk. Don’t even get me started here. NWBO has been running on fumes for years. Many of these risks have been known for a long time, and, to management's credit, they are disclosed at length in the latest annual report. Perhaps the best example is the $15 million loan (or was it $16.5 million?) borrowed from Streeterville Capital. If memory serves, the loan proceeds became available to NWBO in November, with a term of 22 months, but the first payment would not be due for 8 months. So that means the first loan repayment would be due this month (July). That’s more than $1 million per month in principal, not counting interest, on top of all the other ongoing expenses associated with personnel, production, etc. I’m guessing this Series C preferred stock is being authorized now to help ease the pressure from this debt. Has anyone seen an income statement that shows meaningful sales revenue from vaccine doses sold?
13) Regulatory delays are par for the course. Does NWBO have the financial stamina to withstand one or more regulatory setbacks caused by, say, heavy caseloads at MHRA, human failings by Advent staff during a Sawston site inspection, or (heaven forbid) a complete response letter from the FDA? Does NWBO have any cushion or room for error in its commercialization schedule? If so, it’s not obvious.
14) NWBO has an unpleasant history of dilutive financings. Hate to say it, but Scotty is right on this score. Thanks to Jerry Campbell for doing the research and coming up with this history of financings that have diluted the value of common shares. In the left column you see the date, and in the right column you see the number of shares outstanding. The Series C preferreds may have a similar effect, or they may not. At this point they’ve been authorized, but not yet issued. And whatever dilution may take place could be made up for by a bump in the share price (or not). In any case, another serial dilution remains a risk.
15) NWBO is traded over the counter (OTC) and its chances of ever “graduating” to a national exchange like the NASDAQ are slim. Hate to sound negative, but the odds are against us. An SEC 2016 white paper titled “Outcomes of Investing in OTC Stocks,” available from the SEC website, stated that companies traded OTC “rarely grow into a large company or transition to a listing on a stock exchange.” This is not to say that it never happens; it does. But it’s rare (less than 1% per year based on SEC figures) so that’s why I include this among the risks that give me pause. Here’s a data table from that paper:
So there you have them: 15 reasons to worry. Please tell me why I'm wrong, and include any evidence you may have handy. If you convince me, I may resume buying shares.
Thanks!
--OJ
(OncoJock on iHub, @Onco_Jock on Twitter)
Agreed. NWBO senior leaders have an exit strategy.
And I think we're beginning to see it unfold.
To add to your point, Jerry Jasinowski was born in 1939 (according to Wikipedia), which means he turns 83 this year.
Awesome analysis, BB. Thank you!
I commend this clear, coherent post to all my fellow NWBO shareholders.
Will soon do the same for my followers on Twitter.
-- OJ
OncoJock, @Onco_Jock
With all due respect Flipper44, I'm persuaded by arguments put forward by Poor Man and CrashOverride that VC nomenclature (series, rounds, etc.) does not apply in this situation.
Key fact: We have already IPO'd.
Thank you for your humility, BB. It's refreshing.
Thanks flipper for posting this link to the StartupFreak website, but not sure it applies 100% in this situation since the IPO is long past.
Here is the part that grabs my interest:
"Series C round of funding can also take place to prepare the company for an acquisition."
Seems like a deal of some sort might be coming soon. Of course I'm not the first iHubber to say this.
Is it even better than Brunello di Montalcino?
Did series A and B have voting rights?
I'm really focused on the voting rights piece, since it seems so unusual.
Reviewing the pros and cons of preferred stock.
I imagine I'm not the only shareholder here in need of a refresher.
Here's some background from Investopedia:
https://www.investopedia.com/articles/stocks/06/preferredstock.asp
I note with great interest that these preferred shares are unusual in at least 2 ways:
1) they carry voting rights
2) there is no mention of any dividend
The conversion feature seems pretty standard.
Apparently the minimum 3-month holding period is laid out in the prospectus, not in the 8-K. Many thanks to iwasadiver for that nugget of info.
Could the 25X voting rights be a way for NWBO management to give a favored buyer/partner/angel investor a louder voice at the upcoming annual shareholders' meeting?
Yes, agreed, but normally common shares carry voting rights but preferred shares do not.
Thanks BB I'm liking this surprising new development more and more as I learn to wrap my mind around it.
Seems like it could be a savvy defensive play against abuse by the market makers.
Since you are so bright (!) what do you make of preferred shares with voting rights (unusual) and preferred shares that pay no dividend (also unusual).
--OJ