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Nobody ever said that they're discussing "how to analyze the data", those are your words. They said they were going to discuss "data analysis", which I read as getting FDA sign off on closing the trial and unblinding the data prior to moving ahead. This seems prudent to me, since so much is riding on the trial, and has nothing to do with asking the FDA to change anything.
Your recent experience with IPCI (I was on the wrong side of that trade as well...) should be all the evidence that you need that the FDA can be fickle, and it's far better to ask permission than beg forgiveness, so to speak.
I have no qualms about the delay in closing the trial until after the FDA discussion.
Interesting, potentially a great catch there. Thanks Craig. That would change the thought pattern for me slightly, but not too much. Does anyone else have additional information here?
I believe the rule is that you must have an official purchase plan in place to continue buying. I'm no expert, and others have alluded to "establishing a pattern of buying" and having that be a de facto plan, but I'm not sure that this is an accurate representation of a legitimate way to continue insider buying through a material event. If my understanding is correct, Mann would have to stop buying due to a material event since Collier was clear that no official purchase plan is in place. However, the company has about four business days (again, in my understanding) to PR a material event. Compare that to the timing of the Form 4's we've seen filed for months, and...
You're not going to have a definitive stop in his buying before a PR. So the entire issue is sort of moot, except for the fact that Mann continues to buy, and apparently with his own money while deferring a salary. On the surface, that appears to be a good thing, and one of the reasons I remain here.
No, we can't simply agree to that. Because they can't have the data until the FDA agrees to unblind the trial. Then they actually have to analyze the data once they have it. On top of all of that, they're certainly playing a strategy game (well or not, I can't say at this point) to maximize the impact of any positive news that they could have.
You assume that their current silence means too much.
I disagree with you pretty strongly on this. At no point in the PR does it reference discussing trial protocol with the FDA. It references patient enrollment and data analysis. Patient enrollment could easily be CYDY asking for expanding the trial to 33 since they have those patients - not discussing the need to find more patients. Data analysis is crossing t's and dotting i's with the FDA on locking down and unblinding data. Nobody mentioned trial protocol.
Once more - and as you alluded to - the firm cannot have the data for primary endpoints, therefore any discussion about the data being good or bad and influencing company strategy is completely irrelevant. The only data that the company has and may act on is the open label portion of the trial, which is nowhere near complete and does not provide a primary endpoint anyway. It's largely for safety data, and it's very likely that the company would have had to disclose any serious adverse events encountered. All we know of the data from that portion of the trial is that at one point, eight out of nine patients who had completed that arm were on rollover treatment. That sounds pretty positive to me.
As I mentioned in my previous post, any company in their position would have to begin the process of raising additional money unless they had literally inked and finalized a sale, at which point we would know about it. They're pre-revenue, everyone knows they need to raise money regardless of if the data is good or bad. It feels like you're reaching pretty hard to spin this negatively, and I'm not sure why.
True. Plus, let's not forget that they were easily raising at .75 when the SP was well below that level. There's no reason to believe that the market - if and when it occurs - thinks that the raise will be below .75.
Also, on the surface, floating the possibility of a raise in the future is neither good nor bad. It's simply running a business. Even if they're currently in the final stages of negotiating a buyout (not suggesting they are or aren't), management still have to plan though the company is a going concern. That's no reflection on if data is good, bad, or indifferent - if they even have the data at this point.
To me, the price drop is all based on fear selling. We'll find out soon enough whether they had anything to actually be afraid of.
The firm did give numbers for expected remaining trial and operating costs over the next two years, I believe at the last investors call. I don't have access to my notes at this point, or I'd provide the figures. I bet someone has them...
Don't believe so. Standard part of behind the scenes negotiations. A bored lawyer could confirm.
Not really for you gestalt, just responding to your post...
Let's not forget that as long as the trial enrollment is open, the PE data cannot possibly be known to be bad. It is literally impossible, because nobody can look at the data until the FDA signs off on locking down and scrubbing the data prior to unblinding it.
I'll repeat that: IT IS LITERALLY IMPOSSIBLE FOR THE PE DATA TO BE A KNOWN NEGATIVE FOR THE COMPANY until the trial closes and the FDA signs off on unblinding the data.
Fred just seems to have a different risk tolerance for his investments, nothing wrong with that. It's not my risk tolerance, so I make different investment decisions. To each their own.
The important thing to remember is that mono is an open label trial. That means that data can be viewed in real time, and gives credence to the idea that BP could be considering mono valuation. By year end 2017, we'll have no less than five months data on no less than 100 patients in this mono trial. They'll have a VERY good view of if the drug is safe and effective or not, and they'll have it long before the P3 mono trial is completed. Any potential suitor could see data for negotiations with proper NDA in place, which is standard M&A practice.
I'd be over the moon for $20, and my expectations are lower. But I'm absolutely of the opinion that any suitors will be forced to value mono VERY soon in any offers, assuming real time data is good.
I also strongly believe that they'll sell the whole bit instead of licensing piecemeal, so I don't think that discussion is all that relevant to be honest. But that's just my opinion. Licensing may turn out to be more salient if data comes back effective, but leaving something to be desired.
Microcap, that's also the beauty of it.
I appreciate the post. I certainly understand the realities of investing in pre-revenue biotech companies. I also understand all of the relevant findings, the deferment of executive pay, the fact that nobody hits timelines, and the potential payoff if this thing were to hit.
I actually like biotech in the OTC world, as opposed to other sectors, for one big reason: there's plenty of verifiable data once you're in clinical stages that you can reasonably assess when making an investment decision, and there's a lot of structure to the path that a company must follow in order to make money. It's easier to put the pieces together in biotech than in other spaces, in my mind. However, this isn't clinical stage obviously, and they've been VERY tight with information on pre-clinical trials. This is the part of the game that I'm new to. So again, the question is: for others who have invested in pre-clinical biotechs, is it standard practice for a company to provide no updates whatsoever on the actual progress of or protocol for pre-clinical trials? Or is ENDV being abnormally tight-lipped on these matters?
That's the only thing that worries me. I have no data to look at, and they've given zero information on the pre-clinical trials they're working on.
I'm not willing to equate low post count on a given day to definitely being a pump and dump, but I've started to have my doubts here. To others who may have dabbled in preclinical companies in the past, is it typical to have such little information available about the progress of preclinical work? How would one go about verifying that any of this work is actually ongoing, etc?
Not suggesting that I don't believe that it is, but some evidence would be nice. Basically the one thing keeping me here at the moment is Mann's buying, because I can't figure a rational way that this could be done with company money that wouldn't be blatantly fraudulent and serve as a one-way ticket to federal prison for these guys eventually. Logic tells me that if he truly is buying with his own money, which by all accounts he appears to be, then there must be something to this.
Still... some evidence would be nice.
While that's true, I see another angle to that. If you PR enrollment, you might reasonably expect a jump in share price. However, that could lead to some gains taking by long holders, while there is also a window of time for shorts to jump in and exacerbate that selling knowing full well that if they're out in, say, two weeks, they won't be blindsided by good data. That's how I can see a PR on enrollment only allowing for erosion of any immediate share price appreciation prior to a results PR, and how shorts could play a role. That's how I'd play it if I were shorting, I know that. I can understand the company wanting to avoid that if they believe results will be positive.
I'm not well-versed in the ins and outs of M&A discussions, but I think that if there were something considered material that they would otherwise have to disclose to shareholders, they would have to disclose it regardless of ongoing buyout discussions.
Mostly true. The FDA has to sign off on the un-blinding of the data. The data would exist 7 days after the last patient is/was injected, but they may not have immediate access to it. I'm assuming this is part of the 2-4 weeks of compiling data prior to releasing results.
I agree that maybe the PR on enrollment would have built momentum, etc. The way I can see management not wanting to PR it ahead of (presumably) good news is that it would risk a run up in share price... only to see profit taking and retrace prior to the endpoint results, which might kill the momentum. Maybe they think it's better to have it sit steady, then bombard with one big PR on combo enrollment/PEs as well as an update on mono enrollment, and try to get the SP as high as possible in one big push.
Not saying that I agree with it, or this is the only way to rationalize the decision not to PR enrollment, but I'm sure that they're being rational about it. Their money is in this too.
Either way, can't wait til that PR. Count me in the same "sick with anticipation" boat that we were filling up yesterday.
I'm not trying to argue that point with you - in fact, if you recall, my original post was reminding everyone that they plan to exit after P2. I'm just supporting why that might be a good idea instead of trying to take it all the way to market and grow into a pharma giant. The trial plans in the investor deck shows that they believe that they'll be granted a pivotal efficacy trial for P2b (which actually looks a lot like a P3, following a sizeable P2a safety/efficacy trial...), which would be wonderful and would make a post-P2 exit both likely and very lucrative. All I'm saying is that having ODD doesn't guarantee you anything from the FDA in terms of the trial protocols that they will agree to along the way, or the evidence that they will accept for efficacy.
You may be of that opinion, but the FDA clearly has the final say. Check this article/paper on the regulatory framework involved. Scroll down a little more than halfway to the header titled "Evidence of Efficacy Accepted by FDA".
https://www.ncbi.nlm.nih.gov/books/NBK56185/
Fact is, the numbers suggest that we're likely to need a P3. Not guaranteed, but the unadjusted odds are against getting by with a single P2 trial to show efficacy.
Again, not trying to be a downer, just bringing real talk to the table here. I believe this is why management plans to exit during/after P2.
True, but only partially. Oncolix will be dependent on the FDA to accept the efficacy results from P2 in order to forego a P3 trial. Again, a variable that includes the regulatory (and ensuing financing, etc) risk that management appears to wish to avoid.
Not saying that can't happen of course, just that it's far from a given. Even if a P2 shows some level of efficacy, it's all up to the FDA. And it's dangerous to trust the FDA to act rationally.
For everyone discussing the possibility that Oncolix could be like an Amgen/Biogen/Jazz, that would be fantastic. Truth is that this won't be the case, as management has stated very plainly in their investor materials (available on the website) that they will be angling for an exit strategy (i.e. sale) somewhere in or after phase II trials. While that likely precludes the stock ever hitting $150 (although one can dream!), it also provides a much greater probability of a very significant return from current SP levels. Phase III trials are very capital intensive, as are the machinations that the FDA can require, sometimes seemingly at random, for the approval, labeling, and marketing of a new drug. Let's not forget the reimbursement process, which has also tripped up a number of very promising drugs when the chips didn't fall properly.
For me, I'm quite happy that management is planning to avoid all of this entirely. They want to develop the drug to a point of obvious viability, then sell for a very nice return. Not only will this significantly cut down on time and capital required, this should also include some level of valuation for future indications, which hypothetically will have been derisked to some degree through safety data from the ovarian cancer trials and proof of efficacy of the mechanism. Let some big pharma deal with P3 and beyond, and all that comes with it.
Not to be a downer on those dreaming of a $150 stock, it just doesn't appear to be the plan so I wanted to make sure that the record is straight. Don't worry, if the drug works, we're all going to make plenty of money.
Thanks for the quick tutorial in the PM's, Zen.
Hey woodenbear, good question. All I can do is give my opinion on it, and the way I've thought about it for the last six months.
I think that the company will be able to ask/receive a significant portion of the value for mono within six months. They need 24 weeks of data from 100 mono patients to provide the safety data for combo, per FDA requirements related to reducing the number of patients for combo. Since the mono P3 is an open label trial, there is no issue with blinding the data, so real time results will be available to both the company and any prospective buyers who sign an appropriate NDA. If the FDA is receiving combo well, and the interim mono data at the time is strong (I think we have every reason to believe that both efficacy and safety will be solid), then mono will start to look derisked. Not completely, of course, as the FDA can do many illogical things. But if there are multiple potential suitors looking at it (as I assume there will be), then it begins a game of chicken over who is willing to pay the asking price earlier than the others. My guess is that management is assigning GvHD some value as well, and the "offer" will be "if you want to buy it for HIV, you're going to pay for it for GvHD as well." I think that the 24 weeks of mono data on 100 patients time frame is the inflection point where the risk becomes worth the reward for a buyout partner.
Completely my opinion, of course, but that's how I've always seen it. Interested in what anyone else thinks.
To be fair, if all we're doing is taking everyone else's word for it, who knows who actually has what invested here? :)
I think it was a reasonable line of questioning, if an unlikely thesis, and his responses have been plenty reasonable. And if he's not invested, there's nothing wrong with doing your due diligence and trying to get questions resolved prior to buying in - or choosing not to.
Plus, if you check his posts on other boards, he's adding value. I don't think the questions were an attempt to poke the bear.
Fair enough. I was about to post back to you anyway - after talking with the very bored lawyer that I keep on retainer, he has zero concern over the use of convertible instead of stock. Says it's extremely common, and he writes up convertibles and participatory promissory notes all the time for his clients. That's enough for me, but then, I know my lawyer and your mileage may vary.
Don't blame you for noodling though, I certainly sit around and do the same.
Fred, I think the line of reasoning that says they went with debt and sold to insiders in order to secure the assets of the company in the event of a bankruptcy is faulty. While you are technically correct, there is one big issue that I see...
The assets of the company are essentially the intellectual property for PRO-140. The only reasonably likely (and I say that with no belief or indication that this would happen) way that the company would file bankruptcy is if the P3 trials fail due to more than a poorly-designed trial protocol. If the trials fail due to more than a poorly-designed trial protocol, then the drug is not very good, and the assets of the company are not worth anything. Or at least they would be worth very little currently, and would be very capital intensive to make them worth anything. For this reason, the only way I can see insiders putting in their own money is because they believe they'll see a return, not because they're concerned about viability and want to secure the company assets.
That said, I do not have a real theory for the debt vs. stock question. It's interesting, but doesn't keep me up at night.
Your thoughts?
Nobody is arguing that the company balance sheet is flush with cash at the moment - the responses were pointing out that they could easily raise funds on the terms of the recent offering even if Caracciolo and, more recently, Dockery, had not put up money themselves. There was no fear that they could not raise the funding as a company. Therefore, most take it as a sign of confidence in the health (pun intended) of the product that something like $1.4mm has been put up by insiders very recently. That indicates to me that, at this late stage, they are VERY confident that their investments will be rewarded.
Hi all,
Just starting research here, and the flow of information seems a bit limited. Two quick questions that would be very helpful if anyone were to have insight:
1) Has the company ever stated an end goal or exit strategy? Are they actually looking to take BIV201 to market, or are they trying to get to a sale/partner arrangement?
2) What in the world is going on with the trading volume? Average volume of less than 7k shares daily? I understand that it's a clinical stage, pre-revenue biotech... but it's also in P2 with a drug that has ODD. Seems odd.
Anything I should know off of the top of your collective heads?
A while ago, I may have agreed. After they just raised about another month's worth of funds and then terminated their offering... I'm convinced that soon we'll think management is worth whatever they're paying themselves. There is no defensible rationale to close the offering at this point unless you are positive that any funds that you may need in the very near future will be raised on substantially better terms.
That's an incredibly inane comment given the current expected proximity to a pivotal PR on Phase 3 trial results.
My pleasure... I try to add some value back from time to time!
While that's true, it's also completely inappropriate to view all reverse splits the same. The majority of reverse splits occur when a company's stock price has fallen to extremely low levels. This is often due to massive amounts of dilution through selling shares in the open market, thus driving the price down while simultaneously increasing outstanding shares, and not having a healthy business or a real path to get to one. Yes, most of these companies will fail, because they are not viable businesses to begin with.
However, reverse splits can also be an effective management tool for managing share price or outstanding shares for any number of legitimate reasons, including as a tool to facilitate uplisting to a major exchange. The difference is that the company has to have actual business prospects in order to sustain any perceived or actual benefit from the reverse split. I won't speak for you, but most of us here believe that CYDY has a future with PRO 140 based on previous trial results. In this case, a well-managed and timed reverse split could absolutely help the company. Am I suggesting that it's necessary or that I'm in support of a reverse split? No, only management has the information necessary to make that call. Am I confident they'll make the correct call on whether to split or not? Not as confident as I'd like to be, but I'll give them the rope, because I believe that the company has a bright future.
The simple moral of the story? Please don't throw the baby out with the bath water. Most companies that do reverse splits fail because they are already failing companies. They don't fail because they did a reverse split.
To be fair, the bar there is relatively low due to the nature of the ODD program - the FDA is trying to incent companies to develop drugs for these conditions. HOWEVER... there is a similarly low efficacy bar for approval for the same reasons, which obviously plays to our benefit in the longer term. And regardless, they couldn't/wouldn't grant it without positive indications. I wouldn't be here if they didn't have ODD.
Not to mention, the pre-clinical results are clearly positive, or the FDA could/would not grand Orphan Drug Designation...
Strongly doubt that was the case. The very bored lawyer I keep on retainer remarked that the 2B number caught his eye yesterday - not so much for the number, but for the fact that it had subtle markers of a carryover or placeholder that never got properly finalized. Lack of capitalization of Common Stock, in contrast to the rest of the document, for instance. As usual, the simplest solution is probably right - they just missed this in final revisions and had to amend. It happens sometimes.
In other thoughts, I was looking back over the investor materials that they have on the website, and a few things caught my eye this go round:
- Oncolix estimates a future funding requirement of less than $30mm for the next several years, specific to taking Prolanta through P2 trials for ovarian cancer. This is also where hey look for an exit strategy. That is not a lot of cash, especially if there is SP appreciation on interim and/or final P1 results.
- The chart of institutional ownership in Oncolix has some commonalities with groups that they've received grant funding from. It may make sense for some of those groups to continue funding through grants, as possible, to avoid dilution of their ownership. Particularly over the next twelve months.
Looking back over those slides made me remember why I felt good about this investment to begin with.
That's huge...
Did somebody drop a pin? Thought I heard something.
That's my point - just demonstrating what a ridiculous, slanderous, and baseless theory it really is. Appreciate you adding details on the actual acts that require them to be audited, etc.
Correct me if I'm wrong, but wouldn't #1 be outright fraud? As I understand it, all of the principals are deferring salary, which would make using proceeds of corporate stock sales to purchase stock into a personal account clear misappropriation of funds. People keep mentioning that they believe that this is what is happening, but they provide no proof whatsoever for that theory. That would be pretty brazen of Mann, as the paper trail would not be buried that deep in the event that this company were to come under investigation. And it would almost certainly come under investigation eventually if any of the things that many people have "alleged" here are true.
In short, it would be monumentally stupid for the company to misappropriate proceeds from stock sales to allow Mann to purchase shares in a personal account. That's an easy way to a fraud conviction and a nice prison stint for all involved. Therefore, I don't buy it.
That said, there is likely at least some truth to your second premise. I haven't run the numbers, but it's obvious that the share price has fallen over the last couple of months, meaning that he can buy more for less. I know I have been. I'm not sure how the math on dollar amounts per day would shake out - someone else can do it - but 60k+ at $0.02 is definitely still more than 2k at $0.05 for what that's worth.
Saltz or others - any insight or opinions at this point as to whether or not you believe the company will PR last patient injected or just wait and PR the results?
Glad I'm not missing anything obvious. Perhaps the FDA felt that with the concession of bringing the n down to 30, they needed the higher bar as a balance? Not sure we'll ever get the answer to that one. Hopefully the company has had these discussions and may, at some point soon, be in a position to openly discuss the labeling they'll be pushing for.