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He seems to be a CYDY promoter, based on his posts on other boards. Good luck to him/them. The silence from CYDY management has been deafening, and perhaps informative.
I had been "approved" the night before, then cancelled by email 5 minutes before the start. I did not see the email until after I tried to sign in and was "rejected" with no explanation at all. So I felt your pain. Why invite people if you are going to reject them for not being a client? That was handled very poorly.
He was talking about his own product I believe. I did not hear him react at all to Humanigen comment by Cramer, other than to use it as an intro for his own self-serving comments. He just wanted to talk about his own therapeutic products (Plasma based polyclonal antibodies) in development at that point.
My guess is that CYDY was told to do another study, like Merck, and they are arguing with the FDA about it right now. They are talking with Canada and the UK in hopes they will be more lenient. Just a guess.
If they had good news, it would be out by now.
I believe you may misunderstand what these numbers are. They are not related to short interest data that many investors are concerned about.
They simply represent whether transactions were initially sales by someone or instead were initially purchases by someone. They do not distinguish between sales by someone who already owns the stock or sales by someone who is borrowing the stock and has to (theoretically) buy back stock at some future date to "cover" their borrow.
In the simplest sense, they represent down transactions (vs bid and offer) against up transactions. When they happen, the stock usually goes up or down in synch. Other than the fact that the stock has moved (which we already know), this data appears to have minimal value to me. Some people like to look at how much the stock prices move up or down in reaction to volume movements like this (and related inconsistencies), but that is a different kind of analysis that I do not think you are talking about.
If you believe that these numbers cumulate to change "short positions" -- a completely different animal -- you are mistaken.
Nomis still has over 5.5 million shares. I don't think they are the enemy. They sell small amounts -- not enough to move the needle much on the stock price. Often they report 3 days of activity at a tme, and the total for the three days looks bigger in terms of daily volume, but if you look at the detailed report, you will see that the individual days are not all that big, and the average Nomis selling prices on those days don't really correspond to significant points in the day where the HGEN stock price dropped.
I have posted before about why Nomis may be selling, so I won't repeat them. For whatever reason, their actual sales seem reasonably constructive in avoiding dropping the price. Remember that Humanigen itself is selling 5 times more shares a day than Nomis starting from December 31st with their $100 million ATM share offering that may still be ongoing.
Assuming, of course, that the IRB is the actual source of the mistake. I thought the IRB was supposed to issue a halt determination for a safety issue -- which was done for one specific study (not ours) at one trial location. What followed may well be someone else's mistake in follow-on reporting as it moved along within government channels. But I am not an expert on this, so please don't yell at me by using ALL CAPITAL LETTERS.
Whoever made the mistake, a witch hunt followed by a public mea culpa is not necessarily followed in situations where government bureaucrats are involved. There is too much likelihood of bruised feelings, careers damaged or destroyed but not entirely eliminated, etc., with the possibility of severe payback someday. People make mistakes. Even very costly mistakes. Asking for further corrections may not benefit remaining stockholders all that much, and may be risky for ongoing relations -- HGEN has many future trials yet to be approved.
Just my opinion.
Looks like KNSA may have a weak study. 573 participants in Phase 2/3, but the patients are split into six groups. Half are already ventilated, with a 3-way split between placebo and either 6 or 10 milligrams per kilogram of body weight. The other half are not yet on ventilators, but require supplemental oxygen.
So they may get an approval for vented patients (Lenz is intended for pre-vent, and if successful, there may be few vent patients left to serve!). For the non-vented, the study looks underpowered (size of study for statistical significance), and lower dosage (maybe half the HGEN dosage?), so it may not be competitive with HGEN.
Cross your fingers.
You should read HGEN chart on competitors -- page 44 of their Featured Presentations on their Events and Presentations page. The page number is from the February 1 version of the presentation. They will probably update it as of March 1 when they do their next presentation in a few days.
Mavrilimumab is one of the key GM-CSF competitors still standing. It targets a slightly different point on GM-CSF (the alpha receptor) which may or may not make a difference. The Gilead/Kite study that is testing Lenz with Car-T therapy also includes Mavrilimumab, so Gilead and/or the government may have an idea of who is better. At least Gilead thought they were in the running for Car-T.
They may have made a similar mistake as other competitors have done with low dosage, however. The old rheumatoid arthritis studies for this drug used 50 to 150 milligrams, which is way too low. An earlier Italian study for Covid used a dosage that was per kilogram of body weight, so they may be using 500-600 milligrams in their study. HGEN is using 1800 milligrams (600 per infusion).
The short issue may not have been posted here, but it has been posted big time on Twitter by people with thousands of followers. People are highlighting that KMPH is the second or third highest shorted company in the country, with the March 2 PDUFA coming up as an inflection point. They may not understand where the shorts are coming from. Because of the Gamestop real short squeeze, novice investors, and many experienced investors, are looking for an easy way to make big bucks -- identify highly shorted stocks and play them. This may attract very soft hands into the stock before March 2, who will sell pretty quickly if their short term hopes (one or two days) do not pan out. This may depress the stock price rather quickly, and it will take a while before long term investors such as yourself are rewarded (I'm assuming you won't sell during the first few days with the company outlook you have laid out).
By the way, it does not make sense to me for a normal short seller to take on a drug approval where there is a long-established safety and efficacy for the underlying drug, but there may be some who hedge their positions with offsetting calls.
I am just trying to point out that there may be no short squeeze, and why that is the case. That will allow other investors that may read my posts to adapt their investing strategies as events unfold -- this will hopefully save them money or make them money.
Here is my prior post edited to meet guidelines:
“However, it appears they were trying to get the convertible bond holders to change to preferred shares that also were convertible to common stock at $6.50 a share. Since the bonds may have been convertible at $5.85 a share, and in any event are due to be paid out in full on March 31, 2021, I don't know how much actual conversion to preferred shares took place. But even if it was successful, the bondholders were offered boatloads of preferred converts and warrants for more common shares as well.
Which is my point all along -- there is a tremendous overhang of warrants and converts to common stock in the $5.85 to $6.50 range, and these parties may well have already sold these shares short into the market at prices between $8 and $10. If so, these short sales and short positions can never be "squeezed", as some parties elsewhere are advocating. The holders will simply convert to cover.
It would take at least half a day of research into all the KemPharm SEC filings for the past four months related to the capital raise and the restructuring in order to get a better handle on all this. Since I do not plan on investing in this company, I will not be doing it. I recommend that anyone who is planning on investing do the work -- do their own due diligence -- because some of the quantities are frightening.
I am not saying that the company cannot be a success (although their business model is a strange one), I just don't think any pops in the stock on FDA approval will be very sustainable.
Just to be clear, I am only disputing the short covering potential for this stock. I have no problem with the science or market potential of the drug.
People should be aware, however, that KMPH has already sold the rights to the drug to a private company. KMPH will be entitled to royalties and milestone payments along the way, but we don't have a lot of definition (other than the total) of the milestone payments or their timing. KMPH no longer has control of the development, manufacturing, or marketing of the drug. The bulk of the profits will be earned by Gurnet Point Capital and its subsidiary Corium International. The royalty/milestone payments may well make KMPH a winner in the future. It's just hard to value it at the moment (for me).
Some food for thought, from KemPharm SEC documents:
"As of January 31, 2021, we had outstanding (i) 18,849,983 shares of common stock, and (ii) 31,476.98412 shares of Series B-2 Preferred Stock."
"As of January 31, 2021, we had outstanding warrants to purchase up to 14,360,807 shares of our common stock at a weighted average exercise price of $7.31 per share and which expire between October 24, 2023 and January 26, 2026. The warrants include a net exercise provision and contain provisions for the adjustment of the exercise price and the number of shares issuable upon the exercise of each warrant in the event of certain stock dividends, stock splits, reorganizations, reclassifications and consolidations."
At June 30, 2020 KemPharm also had $67,271,000 outstanding convertible debt with the following conversion price:
"In connection with entering into the January 2020 Exchange Agreement, the Company entered into an Amendment to Facility Agreement and December 2019 Notes and Consent (the "December 2019 Note Amendment") with the December 2019 Holders that, among other things, (i) amended the December 2019 Notes to (a) reduce the Conversion Price (as defined in the December 2019 Notes) from $17.11 to $5.85 per share"
I could not find more current information on the convertible debt, especially what happened to their conversion rights after the reverse split, but it is still a red flag issue, along with the warrants.
For example, the short sale positions in the stock could easily be the convertible debt holders already selling at "good prices". If so, these short sales cannot be "squeezed" by higher price levels. The bond holders instead would simply convert the debt into new stock shares and provide these shares to cover any borrowed shares (which they may not even have had to do legally, since they had access to the new shares). So no squeeze.
The same could be true for current warrant holders, who may also have sold stock short recently, because current prices are higher than their conversion price. So no squeeze.
Buyer beware.
I fell off my chair when I heard it. It was mentioned when they were talking about strategic partners/actions. Companies normally set up data rooms when they are for sale, or have a division for sale. Normally I do not think about buyouts at this stage, but I may change my mind for HGEN. Given the wide applications for Lenz, bigger players may step up after the EUA. It would be nice to see a bidding war.
At least you didn't register and then get an email saying you had a special link just to get in, and then be rejected (for no identifiable reason or than "rejected") when you tried to sign in at the start. Took me a few minutes to sign on to phone access, so missed the first part of conversation.
Look into "cancer clusters" to avoid the crazies. Sometimes a cigar is just a cigar.
You can now buy April options for HGEN apparently. Safer than March options IMO, and cheaper than May options.
Trying to decide if Otilimab news this morning from GSK is good news or bad news.
It's good given that one of the very few remaining therapeutic competitors has stumbled.
It's bad if it indicates that HGEN's antibody will suffer a similar fate, since they are both anti-GM-CSF.
The HGEN trial may do a lot better if their antibody is better-engineered (as HGEN claims in general), or if GSK's dosing regimen was poorly chosen due to lack of experience and risk-aversion (HGEN had a number of earlier trials supporting safety and efficacy that may have led to better dosing decisions), or if GSK's allowed use on ventilated patients horribly distorted their study (HGEN avoids giving their drug to ventilated patients), or if HGEN's endpoints are better chosen, or if .....
Any experts out there who would like to chime in?
I like that theory, but also believe Nomis management has three other possible/probable objectives:
1. rebalancing the portfolio: Nomis is an investment fund for a small number of rich investors. HGEN has become over 15% of the fund (was over 20%). Manager is slowly booking huge profits from HGEN and diversifying the portfolio.
2. Sales may be to fund minor withdrawal requests from individual members for cash flow needs (lower probability).
3. Manager is entitled to bonuses along the way, and is selling enough to pay out his salary and bonuses. He is trying to pay out the bonuses on a timely but conservative way so that he can possibly reinvest his own funds into HGEN before it gets an EUA and the price explodes (higher probability).
Average contracts may be higher given that the manufacturing steps seem to be split among various manufacturers. They each appear to have different expertise in the manufacturing and packaging process. HGEN had a schedule about this in a recent presentation. I will have to look for it.
HGEN CEO said there is a 2-year backlog for pharmaceutical grade glass products (vials, etc) last week. I have no idea how that affects HGEN, since he did not elaborate.
And yet, the CEO reconfirmed the 100,000 doses in the first year just last week. I fell off my chair and cried a little.
Sorry, I don't subscribe to a buyout alternative. It may happen, but investing with buyout in mind has cost me and many other investors way too much money over the years. I trade based on other factors, and never invest/wait for a buyout. Personal choice. I believe Jim Cramer has the same point of view. YMMV
A buyout with earn-out provisions (similar to the Merck buyout deal with OncoImmune) would be disastrous for us, in my view. The bulk of the potential payout would be significantly discounted by the market.
To defend the $10,000 price point, it seems clear HGEN has been raising money to avoid using government money with strings attached. They could have settled for a Merck-type deal more in the $5,000 range, but chose not to.
To me, this signifies smart, tough management that refuses to be pushed around by the government. It's meeting its manufacturing requirements for an EUA by raising money to commit to contract manufacturers.
Sadly, they have done it by using the ATM approach, which has resulted in strange stock price action for the past two months, and has pissed off the investment bank community (JPM in particular) by raising money inexpensively, and not by using a fat-cat underwriting commission structure. I'm not saying they are completely wrong with this, but I think there are unanticipated consequences -- including weak hands now owning a chunk of stock, which may haunt us in the future, and may already be haunting us.
A major "special" factor putting a lid on the price since December 30 has been their "unadvertised" stock sale through s shelf ATM (At-The-Market) offering of $100 million of stock. If they were targeting to complete by the end of February, that meant 40 selling days, or $2.5 million a day of stock. If full enrollment drifted a little late (which it seemed to do), then originally they may have been targeting 30 selling days until mid-February, or $3.3 million shares a day. Since the stock price was about $17.50 when they started, this implies perhaps 140,000 to 200,000 shares a day expected to be sold -- which is a wicked overhang for this stock. That's enough to trigger computer algo trading into thinking the stock is "weak", with computer-driven sales also driving the stock down in the face of good news.
Supposedly "These transactions do not involve any special selling efforts (i.e., no road show or other solicitation) or an amount of the issuer’s securities that would be considered significant relative to that issuer’s public float or daily trading volume. Similarly, the purchasing broker does not use any special marketing efforts." (generic quote about ATM's)
I think this may become a textbook case of mismanaging a fund raising by not understanding what could happen.
My understanding is that the rule applies to ATM("At-the-market")-type offerings. No difference between positive or negative news.
I suppose unblinding could be argued to be not fully indicative until the data is locked and top line results are officially known. But I doubt it. Also, there has been tough talk from the SEC about insider knowledge for COVID-related stocks, and some people are suggesting that the SEC and the Justice Dept. may raise violations to a criminal level.
ATM's also have other rules against "managing" the stock price during the offerings. So my expectation is that the Fireside Chat will either be a whole lot of nothing, or the ATM will be over, regardless of amounts raised. Given the timing of the Fireside Chat, I hope for the latter.
Fireside Chat may end $100 million shelf ATM stock offering. Either because it actually is complete or because it has to end at unblinding, when management becomes aware of material non-public information (I understand this is a built-in rule for ATM's). The timing of the chat may have been set in relation to expected unblinding date.
From a post over at Yahoo Finance board:
"Some news from RedHill Biopharma (RDHL) this morning as well as a Motley Fool user recommendation on RedHill. They have oral pills for COVID, now including one for mild-to-moderate being tested in a home environment (just dosed first patient in Phase2/3), and one for more severe (topline results expected in Q2). Different mode of action than everyone else. Just for info. A number of these Israeli stocks ride up quick on news and then taper back down almost as fast."
Their home testing appears to be nurse-supervised and electronically supervised in some way to assure accuracy. Interesting.
Great story! MWM - Massive respect!
Not just for being a big winner, but for going through the desolation and despair along the way and still believing in yourself.
I am not worthy! :)
Sorry for offending you. I appreciate your contributions here.
According to the February 8 announcement, Chappell is still CSO, as well as becoming a director:
"Humanigen, Inc. (NASDAQ:HGEN) (“Humanigen”), a clinical stage biopharmaceutical company focused on preventing and treating an immune hyper-response called cytokine storm with its lead drug candidate lenzilumab™, today announced that the Company’s Board of Directors (the “Board”) has elected Dr. Dale Chappell, the Company’s chief scientific officer, to serve as a director of the Company, effective February 5, 2021. Dr. Chappell will continue to serve as the Company’s chief scientific officer."
Has something changed since then?
Or HGEN is selling $100 million of stock, day by day, in an ATM offering where they are not allowed to smooth out the stock price effect. Wait a minute, they are doing that!
(Sorry for the repetition in response to two different posts with two different spurious comments.)
Or.... the company (HGEN) is selling $100 million of stock slowly, day by day, in an ATM offering where they are not allowed to smooth out the stock price effect. Wait a minute, they are doing that!
That was a real punch in the gut for some! RLFTF!
My apologies for a bad pun in the morning.
My sympathies for anyone still in that competitor.
Is Lenz applicable to Sepsis? One or two other competitors in Covid19 therapeutics refer to Sepsis as a very large potential market (over $30 billion a year).
Chapell also represents major investors in HGEN. With a lot of big decisions coming up, including potential buyout offers, further capital raises, etc., he probably just felt the need to sit in on all relevant discussions -- with a vote.
Short Interest Warning. Many investors either don't care about short interest, or care too much. What the vast majority don't understand is there can be a hidden landmines in the data.
The superficial theory is that a large short interest may have to be liquidated some day, and that will drive up the stock significantly if it happens. Recently, several stocks did just that, as investors "forced" it to happen. Also, many investors see a significant short interest in the stock and assume that there are investors lurking around the stock trying to drive the stock down or at least hoping that it will go down. And that can happen.
But most of the time neither of the above is true, nor will it be. Why? There are two major other reasons for short interest, neither of which contribute to the above scenarios.
First, companies that have convertible bonds outstanding will also have a significant short position existing. And this short position will never have to be covered, nor will it necessarily result in open market purchases of the stock that would drive the stock up. The holders of the bonds also hold the short positions. They cover the stock that is due on the short position by converting the bonds into stock, and they use those shares to pay off the short shares owed. The short position disappears, with no direct impact on the open market price.
Why do convertible bond holders have short positions? When they supply the convertible debt (let's say $100 million at a 5% interest rate -- for a $5 million a year interest payment), they do not want to put up the full $100 million, and they want better than a 5% yield. So they short the stock by selling it at the same time! Let's say they sell $50 million of stock and use the proceeds towards the $100 million they are giving the company. So their net investment is only $50 million, and they are earning $5 million a year on that, or the equivalent of a 10% return. Ahh, but you are going to say that they will have to pay interest for "borrowing" the stock they sell. Assuming for the moment that they have to, their borrowing cost should be really low because they have access to stock to cover ("collateral" in the converible bonds)and that stock is derisked if the price goes higher than the conversion rate (the real risk of a short position). Net, net they still make out enough to want to short stock when the company issues convertible debt.
In fact, they may not need to borrow from someone else, because they can convert the stock (at whatever conversion rate) to supply the stock, if it is needed. A number of factors then come into play (conversion rate vs. current stock price, a contingency for borrowing a small portion if suituations change, ability to short more if the stock price rises closer to the conversion rate, or goes over, etc.) I am not an expert, so can't estimate exactly how much stock is shorted, but you can see the short positions go up when convertible debt is issued by a company. In this case the issuer of the convertible bonds (the company) is the "evil doer" because they trigger the initial short selling that hampers their stock price.
The second reason short positions may exist without necessarily being associated with "evil shorts" is due to the options market. Options market makers must take a short position when someonee buys more puts. If someone is buying and selling puts as a "trade", then yes, there would be an impact on the stock prices as market makers have to adjust their short positions. The effect can be muted, however, by buyers who buy one put and sell another lower-priced put against it, significantly reducing the need for the market maker to actually sell shares short.
More importantly, a lot of puts are initiated by existing owners of the stock who are simply hedging their positions for a period of time. This may cause the market makers to short the stock (perhaps not 100%, depending on strike prices and duration, or even alternatively taking out a semi-balancing put, or selling some calls, etc.). If they do short the stock, the short sale position is a one-time event randomly selected by the owner of the stock. The duration may vary depending on circumstances, so the short position will be retained until that point (i.e., no immediate "squeeze" will take place because they won't be forced out of their position until expiration day, or the original client changes their mind and sells back the put).
Their puts may also be closed out at expiration by the owner of the stock giving up their stock at expiration (as required by the put if it is not closed out before expiration!). If so, the options maker doesn't have to buy stock on the open market to cover the short -- they have the stock from the original owner of the hedged put.
These are just some thoughts to help realize that short positions are not always intended to drive down the price of a stock, nor can they always be squeezed out, nor can a price increase be easily achieved for some shorted stocks by attempting to squeeze them out. YMMV
We should cut people some slack. If I had over 900 posts on the CYDY board, I might be heavily invested in a competitor to HGEN, and really worried about that investment right now. I think we can all appreciate that worrying about our investments can make us a little edgy. Let's all focus on the major opportunity that HGEN is right now. Remember, it's not a pump if there is no dump (or need to).
New 8K David Tousley resigns due to health reasons and Dr. Chapell joins board. Never good to have accounting officer resign, but probably not an issue in this case. Maybe someone was not happy with the way the $100 million is depressing the stock price.
Dr. Chapell was made a director but also stays as Chief Scientific Officer. Most of you know that Dr. Chapell also is a major investor and represents other investors in HGEN.
"On February 3, 2021, David L. Tousley notified the Company of his resignation as the Company’s Chief Accounting and Administrative Officer,Corporate Secretary and Treasurer. Mr. Tousley’s resignation will become effective (the “Effective Date”) on the later of March 5, 2021 or the date that the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 is substantially ready to be filed with the Securities and Exchange Commission.Mr. Tousley’s decision was based on personal health reasons and was not due to any disagreement with the Company on any matter relating to its operations,policies or practices.
Mr. Tousley’s responsibilities will be assumed by Timothy Morris, the Company’s Chief Operating and Financial Officer, upon Mr. Tousley’s Effective
New corporate presentation at Humanigen site. See page 44 -- "Competitive Landscape"
This was posted earlier today. but I have been tied up on another project.