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Jake, something in the Washington Post write up last week about the Martin Shkreli security fraud trial was interesting to me. That is, one charge was that this hedge fund manager had on multiple occassions acting alone or on behalf of his investor group, taken a position for shorting a stock, then proceeded to post anonymously or provide for others to post anonymously on public message boards numerous statements maligning the stock.
In turn, I look at PPHM trading and anonymous posting since the Ronin SEC position disclosure that suggested accumulation started before March and that more recent, after the Ronin letters to shareholders calling for a shake up of the current PPHM Board of Directors emerged and were filed with the SEC. Trading behavior seems to indicate to me that there is at least one more party or interest involved beyond PPHM, Ronin and Dart that is acting to establish or divest of a position in PPHM, using short sales and naked short sales as a tool to suppress the PPHM pps as a means for furthering their objective. That is my perception (of the obvious?), viewing developments as a long time long investor since the TCLN days.
Perhaps, this is just noting the obvious that emerges after a stock pps has risen and there is a reported period of time (like the gap between now and PPHM's October SHM vote for new BOD members) before new information might formally be revealed that will change investor perceptions about PPHM stock value. We can't know if recent trading is influence by Ronin or a third party whose interests are not being advocated by Ronin fully enough to their liking or is just doing a "Shkreli maneuver", hoping they won't join the ranks of those getting caught by the SEC.
It does strike me as ludicrous that these new developments are being communicated formally and through anonymous message boards at a timing when PPHM was supposed to be on track to deliver cash flow net positive standing due to Avid improved sales. It seems even more ludicrous to me that the actions predated the public revealing (all investors can now know) of how PPHM Avid sales goal achievement for making PPHM net profitable or self sustaining is being delayed due to delays in sales to Avid's key customers, maybe temporary delays, maybe not. In turn, we are hearing, through recent PPHM conference papers and Posters that there are still significant Bavi results being drawn from technical review of Phase 3 Bavi trial results for certain patient groups, coming around the same time Ronin is calling for a shake up of PPHM leadership that has a Ronin revealed intent to halt PPHM outlays to pursue PPHM technology value development, so that resources can focus on Avid development.
Having watched with high interest the whole CSM revealed problems of mislabeling of the Bavi Phase 3 trial control group doses, plus having become aware that a major pharma partnership with PPHM was said to have been "spoiled" as the mislabeling was revealed (consider how the run up of pps to $5 1/2 pre split before that news announcement would equate to about $38 per share now), I have come to the conclusion that my holdings are being pressed in two directions. First, encouragment through negative messaging and with what I consider to be an incomplete characterization of PPHM prospects, to sell my position in PPHM. Second, to use the voting power of my shares to change PPHM's business plan, using a change out of PPHM Board of Directors as a tool for doing so.
PPHM now has about 45 million shares outstanding, such that it takes only about 2 1/2 million shares to have an SEC disclosure required 5% share of ownership. Maybe 20% +/- of PPHM shares are affiliated with known disclosing parties. I wonder, what additional portion of non-SEC disclosed holdings (like mine and other long investors with smaller positions) need to come under the control of a third party agenda to further delay PPHM technology from going to commercialization?
It seems that, if the technology were truly dead ended or "worthless", there would be no need to act to halt PPHM funding for such things, as tech development would wind down on its on merits or lack thereof while current PPHM research engagment commitments run their course. It also seems that, if PPHM's business plan for Avid driven self sustaining revenue is needing bolstering by development of new Avid customers, Avid capacity enhancements already delivered resources sufficient for serving current customer demand and those measures announced as positioned for expansion when customer orders materialize have that covered, leaving Avid situated to deliver $100 million to $300 million annual sales if there truly is customer demand for such services. Thus, PPHM achievement of the Avid goal as an artifact of third party customer or potential customer business situations and decision making (like Halozyme). Avid expansion is ready to serve customers when customers are ready.
It also seems that the Ronin letter to shareholders needs some demonstrated follow through beyond a sharing of their vision that I perceive is situated to piggy back on what current PPHM managment has set up for enabling Avid sales goal delivery. Ronin establishing a position that helped raise the pps for a while followed by an erosion of pps due to unknown agendas does nothing to persuade me of the merits behind giving Ronin leadership authority to substitute for PPHM leadership.
What separates Ronin from a PPHM piggy back delivery from momentum under the current PPHM business plan?
Best wishes and IMO.
KT
bfiest, you mention agreement about BOD membership. A few things come to mind.
First, PPHM is expanding the BOD numbers to seven and Ronin proposed three new board members. Whomever PPHM leadership proposes is situated to retain control. Did that PPHM move send Ronin packing? Not likely. So what is Ronin going to do to attempt getting an upper hand?
Second, Ronin started accumulating shares back in March, after which they announced their intentions to lead PPHM to an Avid-centric company business plan, setting aside R&D at least near term. A Seeking Alpha blog from an unfamiliar group even voiced the Ronin outlook from their letter to shareholders into a kind of sort of, but not really, stock analysis of PPHM. I wonder who the target audience for that SA blog would be, other than maybe trying to dissuade new investors?
Third, The pps started rising at timing when Ronin was establishing a position in PPHM, but it seems Ronin would need to preserve or expand their position between now and the October ASM in order to carry any sort of positive credibility with shareholders being asked to vote their shares for Ronin board candidates. Yet, the pps has recently been falling off on relatively low volume with some on this board claiming the pps is going to drop to pre-Ronin pps.
Considering these points, I am left with doubts that Ronin has what it takes to deliver on their objectives in their letter to shareholders. I am now even more inclined to wait and observe new developments between now and October's SHM and decide who gets my BOD vote. If status quo we observe now is still the same come October, there is no clear reason why a Ronin BOD vote would be desirable for my investment. The pps is swinging around in a way that suggests shorting and unknown agendas.
Considering the lack of pps support, among other matters, what is Ronin delivering besides their announced interests in putting PPHM proprietary tech on the storage shelf? Shelving PPHM proprietary tech development helps.... who?
Regardless, it looks to me like a third player besides Ronin and PPHM management is starting to show their hand with PPHM trading. Maybe a small hedge fund opportunizing a speculated ninety day waiting game? I suppose an investor who overextended themselves by purchasing shares on margin will get shaken out if the pps drops low enough, enabling a third party to accumulate shares-- Ronin or ? The three month outlook before the ASM is looking interesting.
Best wishes and IMO.
KT
Corporal, LOL! Or the going concern might have something to do with PPHM's status for NASDAQ delisting, absent implementing the reverse split. Things need not be made more complicated than that.
Best wishes and IMO.
KT
CG, that carrot is available for everybody, just it as has been observed by Ronin and motivated them to invest. If Ronin decides to divest now, it would suggest their intentions were different than outlined in their letter. It is what it is, just as PPHM management progress on their business plan is what was shared with investors last Friday.
The reverse split is done now. Per my previous note, current Avid sales appeat to support the current pps.
Best wishes and IMO.
KT
Bio, that list of iHub Ronin supporters is an interesting dynamic when you think about significance. Common affiliation of shareholders for ASM voting purposes gives cause to group into the count of percent of shares held for Poison Pill purposes. This anonymous message board has a list of anonymous poster names declaring support for the Ronin letter. If the iHub list tallies up to 6% of outstanding shares to mate with 9% held by Ronin, it seems meaningless for Poison Pill purposes, but then again, there are no assurances that parties on that list don't develop an affiliation with Ronin as a voting bloc. Whatever the case may be, I remain watchful of these new developments. On a lighter note, if some parties on the iHub Ronin support list are holding short positions, does that deduct shares from the voting bloc, LOL!? Seems it should...
Best wishes and IMO.
KT
Investorcg, You raise a good point about Ronin regarding the prospect that they become disenchanted with Avid prospects and decide to exit their position.
My observation is that the analyst one year price target of a post split adjusted $14 pps (or higher) falls into focus with a combination of four factors exhibiting their influence:
1. Growth in Avid sales as the Myford facility capacity gets fully subscribed and the third Avid mabufacturing facility gets enough order interest to be built (on Friday, PPHM told share holders that this development is taking longer due to existing customer need changes but there are developments with new customers that might accelerate progress).
2. The market decides to value Avid at more than a 4X price to sales ratio or PPHM proprietary tech at more than zero. (note that Avid annual sales at $60 million applied across 45 million shares with a PS of 4 translates to about $5.33 per share valuation, or about what shares are trading at today).
3. PPHM reduces its research technology development budget to fit under the $20 million in net Avid earnings (1/3rd of sales), or whatever value follows after Avid sales growth. (currently, Avid earnings are covering PPHM research plus PPHM is still posting losses, albeit, smaller losses, as they spend cash raised from ATM sales to support the wind down of PPHM research obligations or initiate new research).
4. PPHM establishes commercial value for some of its proprietary technology, such as new cash flow from an Exosomes test kit or whatever. (The investor call last Friday suggested this is a viable possibility but, as usual, was tentative and inconclusive). Does PPHM tech really warrant a zero valuation in the pps?
All four of these paths have been announced as a work in progress as part of the PPHM business plan-- obviously, progress towards analyst target success is to be determined and warrants an update after Friday's investors call.
Exiting their PPHM position such that the pps is driven down would appear to have Ronin leaving money on the table for another party to just step in and pick up. Current Avid earnings about balances support of the current share price. PPHM delivery on any of items one through four above to support achievement of that analyst price target suggests that PPHM pps could about triple over the next year or two. That seems to be a big carrot for Ronin to hang around for, regardless of whether they win Board seats or management control of PPHM.
Best wishes and IMO.
KT
James, the "why" for naked shorting doesn't need an answer, because suppressing the share price can serve agendas for several factions on that list. Considering the high volume, the naked shorting was likely a violation of market rules. The key question is, which faction(s) did 51% naked shorting today? Then there is the three shares trade after hours that drops the posted trade price close a dime lower. That came right after a large trade so the chart looks like it was large volume at the lower pps. Yikes! Do such things matter?
Best wishes and IMO.
KT
Ku, the large portion of short selling last week as a percentage of volume that James shared with us also left an impression on me, as did the blitz of posts that seemed designed more to confuse than inform. There are agendas in play by various factions, as always, but I don't know where Ronin aligns within all that. Perhaps, new information will come forward that will help reveal intentions more as we approach an October shareholder meeting vote.
Best wishes and IMO.
KT
Oops, the faction on Item T was for that Phase 2 study where the dose switching left PPHM retail shareholders "at the altar" after the run up to over $5 1/2 pps, pre split. The Phase 3 trial halt was on its own path. There were at least three unusual trial results related events that left expectations for PPHM successful commercialization with a set back, by my recollection:
1. the unusual control group performance that showed the placebo group outperforming previous trial control groups by a large margin.
2. the Phase 2 trial dose mislabeling that resulted in some control group patients being administered Bavi. Intent behind that CSM fiasco remains a mystery.
3. the Phase 3 trial halt, which was announced on Friday's investor call to have provided stat sig results from a patient subgroup.
These don't even address the China TNT fiasco where Avid was supposed to be given orders for production that never happened.
Best wishes and IMO.
KT
Ku, That would be "k" on the list. Pick your issue for friend or foe, LOL.
It is not clear to me which factions are aligned with Ronin or were involved with Ronin's acquisition of an SEC >5% reportable position. It is also not clear to me what factions received support from or provided support to Ronin. Yet, Ronin has announced they are looking for retail investor support, including mine, in voting for an agenda at the ASM in October that would place his investor group leaders in charge of PPHM. My providing such support is not something I do without careful consideration of faction alignments. What are the Ronin affiliations?
Perhaps, more information will be revealed that helps reveal the hand of factions influencing what has been made known over the last week or two? For now, Ronin's focus on Avid value extract while suggesting that the PPHM proprietary tech no longer warrants funding has me nervous. That is a huge paradigm shift for those retail investors who have held or expanded their long position in PPHM for years. Yes, that is while experiencing those two reverse splits, through assignment of options and compensation and through Friday's announced extraction of statistically significant positive results showing Bavi value drawn out of the halted Phase 3 trial. I observe that Ronin may not have known of this newly announced Bavi value component when his letter to shareholders was released. Yet, he may have been very much aware of this or other Bavi success being indicated in trials before those highly unusual events suppressed their role in supporting PPHM technology commercialization. Yes, it does matter, to me at least.
Best wishes and IMO.
KT
There have been interesting interactions on this PPHM board in recent months. Here are some observations, all IMO of course.
Who are the players? Let's not forget that there are many more players involved with PPHM than the PPHM BOD and investor groups with a desire to acquire management control of the company (like Ronin and ?)
A. PPHM management guiding Avid production and growth and those directing PPHM research (like President Steve King).
B. Ronin and new entrant large investors who recently announced via their letter to shareholders their intent to invest in PPHM for purposes of maximizing Avid value for return on their investment.
C. Dart and institutional investors with holdings, pre 2017.
D. Pharma contracting with Avid as their supplier.
E. Pharma with "friendly" interests in PPHM technology, be it for partnering, technology rights or collaborative development.
F. Retail investors holding shares of PPHM hoping for a return on investment commensurate with the risks and opportunity costs they experience through their investment.
G. Investors with short positions hoping that lower PPHM pps advances their investment interests.
H. Parties engaging in naked shorting of PPHM stock to suppress the pps or drive it down.
I. PPHM and Avid employees whose success and dedication drives Avid sales and PPHM technology development.
J. PPHM and Avid Knowledge Leaders (scientists, technical)
K. PPHM's Board of Directors
L. Investment analysts covering PPHM
M. Companies and organizations with whom PPHM collaborates for product development or provides PPHM with services.
N. Litigating parties from period after the PPHM Bavi Phase 3 trial halt whose settlement is scheduled to be finalized on July 27, 2017.
O. Regulators like the SEC (financial) and the FDA (technical).
P. Patients suffering from maladies for which Pharma like PPHM is developing treatment, along with their friends and family. The hope is that these patients experience improved quality of life, prolonged life and healing as a result of the medical research, development and commercialization efforts while they personally incur sacrifices to participate in trials.
Q. Doctors and medical staff providing patient care, prescribing treatment and assessing and reporting on patient responses.
R. Research Doctors and technical staff designing and providing for the research.
S. Pharma who might see their products displaced, reducing market sales or who are developing competitive products that might be displaced due to Bavi or PPHM technology in the future.
T. Parties at CSM who made Bavi Phase 3 trial, dose labeling errors and those responsible for the problems discovered as PPHM reviewed unblinded information in advance of their presentation of Phase 3 Bavi study interim findings at a European conference (the pps dropped from $5 1/2 pps to below $1 pps during premarket trading, or about $38 pps down to about $7 pps, post the 1:7 reverse split.
The A through T list tallies to 20 factions with interests in PPHM that extend to recent events. I fall into the retail long investor faction "F", motivated for the sake of faction P (patients and their families while seeking a good return on investment. Notably, not all the A through T faction's interests are aligned and success of some of these factions can preclude the success of others.
What is the situation? Complicated. I observe that Faction "B" (Ronin) has stepped forward and made public to all parties their intent to take control of PPHM managment and strategic leadership through placement of three directors on the PPHM Board. Ronin success, for now, depends on enough parties from Faction "F" deciding to weigh in their support by voting for the Ronin agenda at the October annual shareholders meeting. Avid sales have grown to about $60 million per year, the reverse split adjusted outstanding shares to about 45 million and institutional and large investors now hold about 1/3rd of shares. Avid is situated to deliver enough growth in sales to make PPHM overall profitable, but existing Avid customers are said to be reforming their mabufacturing needs while additional customers are preparing for production of more sales. Absent new customer contracts, Avid is projected by PPHM management to just match Avid's good 2017 FY performance for 2018, not expand sales. During a July 14 investor call, PPHM technology development was said to have shown stat sig successful results for a subgroup drawn from the portion of patients whose results were not impaired by the mislabeling of medication by CSM during the Phase 3 trial.
Why should the retail investors align their shares with Ronin's to enable Ronin control of PPHM? I have not yet been convinced that I should. Rather, I look at the factions with agenda's contrary to my best interests as a long retail investor and wonder if or how those "contrary factions" might have affiliation with Ronin? Factions with interests contrary to long investors might clearly include factions G, H, S and T. Ironically, all the factions listed might have interests that run contrary to mine, depending on the issue being considered.
For now, I continue to watch, read and learn, trying to figure out what is going on with my investment that I had thought would need to stay long on for another six months or more while Avid sales pick up enough to turn PPHM net profitable or while PPHM finds a partner to support their technology commercialization. Ironically, over the last week the PPHM BODs announced they are considering breaking off Avid as a separate business unit while the management takeover candidate (Ronin) wrote they plan to focus on extracting value from Avid growth, discontinuing outlays that support PPHM technology development. Avid's $60 million in annual sales with a 33% profit margin plus prospects for more growth is being recognized, but as a long investor, I know that it was PPHM's BOD that guided action to enable that Avid growth. Making things yet more complex, it is PPHM's BOD that has guided about $300 million in research and development that has not yet delivered a commercial product that can enable some return to the long investors who provided most of those funds. Is stat sig benefits data recovered from the halted PPHM Phase 3 Bavi trial going to translate to helping deliver that value recovery?
It was nice to see the pps recover most of the price dip after the July 14 PPHM investor call. One might presume that Ronin purchases contributed to that. However, it looks like some of those factions whose interests are likely contrary to my retail shareholder interests also benefited from the pps movement from Friday to Monday's close.
So "who's who"? LOL!
Best wishes and IMO.
KT
CJ,
Excellent summary. Thanks!
KT
PD, well said. My take on recent action can be summarized in a good news bad news context.
The good news is that a pharma appears ready to show their hand to acquire PPHM's technology rights. The bad new is that Ronin has emerged saying PPHM value equals only Avid value such that Ronin is riding with company control demands, in behind the now $14 price target by analysts doing valuation based on projected Avid sales.
I perceive what is in play now as running parallels to the study group dosing mislabeling trial sabatoge during the Phase 3 Bavi studies. I observe the manipulative nature of the Ronin proxy statements seem designed to end run around a managment team that values the PPHM tech at more than the pharma wants to pay whereas Ronin is writing in their proxy how they consider the tech value is at zero.
PPHM is set to announce a shift to net positive earnings this fiscal year, per announced plans. Anyway valuation should bring a $14 pps plus PPHM still has its technology rights intact for negotiations with Pharma. We don't need a Ronin BOD change to extract Avid value out of PPHM. The build up of Avid valuation is already a work in progress under current BOD leadership plus PPHM is preserving tech value for prospective tech rights agreements
Of courss, all IMO.
KT
CJ, E Trade waived the fee for the RS processing when I asked this evening.
KT
James, Isn't time to clear trades being reduced to two days soon, down from 3? Might that limit ability to naked short?
Best wishes and IMO.
KT
Loot, Can't give you an answer after a long pause sounds pretty short. The Friday. C will be pivotal, it seems. Updated info is needed.
Best wishes and IMO.
KT
Sulaco, to stay on point, the cancer screening effectiveness identified for the small sample size for Bavi detection of cancer was 100%, was it not? The weak dynamic is the small number of patients in the trial that had bloodwork for post Phase 3 trial halt evaluation. Not a lot, but enough to turn heads at ASCO, it seems.
Best wishes and IMO.
KT
Hi Geo,
Some observations from the SEC filing- The movement of shares was from Ronin Capital to Ronin Trading on a zero cost basis. Perhaps, the trading branch move from the capital branch (recall some shares appeared to have purchase from PPHM's ATM sales), both owned by Stafford, implies preparation for movement of shares ownership to third parties, or perhaps nothing?
Regardless, a different entity is now listed as the holder of about 23 million shares or 7.8% of shares outstanding. That apparently requires new SEC disclosure.
It is also noteworthy that the Ronin purchases had been instrumental in moving the pps from about $0.30 to the current trading range at timing when PPHM had announced prospective net profitability from Avid Sales in FY 2018. I believe the first quarter of PPHM's FY 2018 started in May of 2017. The reporting of FY 2017 results for the quarter closing April 30, 2017 might be expected in the next three weeks or so. Perhaps, that will show good progress towards the FY 2018 profitability goal?
Perhaps, some biomarking collaboation/partnering interest might be ripe for announcement after the ASCO presentations earlier this month?
Best wishes and IMO.
KT
Sulaco, there is a lot going on so I am just getting back to your note about the PSA test having become controversial. The point I was making about the Bavi diagnostics is still valid, however.
I went to what I consider a trusted source (the Mayo Clinic) and found that the Mayo staff posted that about one out of four people who test positive with elevated PSA levels actually have prostate cancer. Consequently, a person testing positive will likely want to pursue follow on testing available to confirm their cancer risk. It is much more rare that there are false negatives, which are due to fast progressing cancers being present. Thus, taking the PSA test can screen for cancer risk but there are risks of false positives, due to factors unrelated to cancer that warrant caution for treatment regimine.
Now consider the indicated positive association from Bavi marking and there being cancer cells present. A small group of patient's data presented earlier this year (ASCO) was showing 100% association between a positive test result and cancer being present. Consider how Mayo suggests there is value in doing a screening test for prostate cancer for men in a certain age range using the PSA test, knowing it delivers about three false positives for every real cancer presence detected. Compare that with a prospective 100% positive test result with Bavi for other cancer type detection. Prospective improved effectivness for survival or prolonging life from earlier treatment of cancer enabled by the screening test is TBD but imputed.
The relevant Mayo article excerpt is cut and pasted below from their web site.
Best wishes and IMO.
KT
Prostate cancer screening: Should you get a PSA test?
Making the decision to have a PSA test depends on a variety of factors. Here are some tips that can help you make a good decision.
By Mayo Clinic Staff
Multimedia
Prostate glandProstate gland
Cancer screening tests — including the prostate-specific antigen (PSA) test to look for signs of prostate cancer — can be a good idea.
Prostate cancer screening can help identify cancer early on, when treatment is most effective. And a normal PSA test, combined with a digital rectal exam, can help reassure you that it's unlikely you have prostate cancer.
But getting a PSA test for prostate cancer may not be necessary for some men, especially men 70 and older.
Professional organizations vary in their recommendations about who should — and who shouldn't — get a PSA screening test. While some have definitive guidelines, others leave the decision up to men and their doctors. Organizations that do recommend PSA screening generally encourage the test in men between the ages of 40 and 70, and in men with an increased risk of prostate cancer.
Ultimately, whether you have a PSA test is something you should decide after discussing it with your doctor, considering your risk factors and weighing your personal preferences.
Here's more information to help you prepare for a conversation with your doctor about PSA testing.
Simple test, not-so-simple decision
There are a number of pros and cons to the PSA test.
Pros of PSA screening Cons of PSA screening
PSA screening may help you detect prostate cancer early. Some prostate cancers are slow growing and never spread beyond the prostate gland.
Cancer is easier to treat and is more likely to be cured if it's diagnosed in the early stages of the disease. Not all prostate cancers need treatment. Treatment for prostate cancer may have risks and side effects, including urinary incontinence, erectile dysfunction or bowel dysfunction.
PSA testing can be done with a simple, widely available blood test. PSA tests aren't foolproof. It's possible for your PSA levels to be elevated when cancer isn't present, and to not be elevated when cancer is present.
For some men, knowing is better than not knowing. Having the test can provide you with a certain amount of reassurance — either that you probably don't have prostate cancer or that you do have it and can now have it treated. A diagnosis of prostate cancer can provoke anxiety and confusion. Concern that the cancer may not be life-threatening can make decision-making complicated.
The number of deaths from prostate cancer has gone down since PSA testing became available. PSA testing has lowered deaths, but the number may not be substantial enough to justify the cost and possibility of harm to the person undergoing the testing.
What is PSA?
Prostate-specific antigen (PSA) is a protein produced by both cancerous (malignant) and noncancerous (benign) prostate tissue. PSA helps liquefy the semen. A small amount of PSA normally enters the bloodstream.
Prostate cancer cells usually make more PSA than do benign cells, causing PSA levels in your blood to rise. But PSA levels can also be elevated in men with enlarged or inflamed prostate glands. Therefore, determining what a high PSA score means can be complicated.
Besides the PSA number itself, your doctor will consider a number of other factors to evaluate your PSA scores:
Your age
The size of your prostate gland
How quickly your PSA levels are changing
Whether you're taking medications that affect PSA measurements, such as finasteride (Propecia, Proscar), dutasteride (Avodart) and even some herbal supplements
When elevated PSA isn't cancer
While high PSA levels can be a sign of prostate cancer, a number of conditions other than prostate cancer can cause PSA levels to rise. These other conditions could cause what's known as a "false-positive" — meaning a result that falsely indicates you might have prostate cancer when you don't.
Conditions that could lead to an elevated PSA level in men who don't have prostate cancer include:
Benign prostate enlargement (benign prostatic hyperplasia)
A prostate infection (prostatitis)
Other less common conditions
False-positives are common. Only about 1 in 4 men with an abnormal PSA test result turns out to have prostate cancer.
When prostate cancer doesn't increase PSA
Some prostate cancers, particularly those that grow quickly, may not produce much PSA. In this case, you might have what's known as a "false-negative" — a test result that incorrectly indicates you don't have prostate cancer when you do.
Because of the complexity of these relating factors, it's important to have a doctor who is experienced in interpreting PSA levels evaluate your situation.
What's the advantage of a PSA test?
Detecting certain types of prostate cancer early can be critical. Elevated PSA results may reveal prostate cancer that's likely to spread to other parts of your body (metastasize), or they may reveal a quick-growing cancer that's likely to cause other problems.
Early treatment can help catch the cancer before it becomes life-threatening or causes serious symptoms. In some cases, identifying cancer early means you will need less aggressive treatment — thus reducing your risk of certain side effects, such as erectile dysfunction and incontinence.
Sulaco,
Your statement is making the assumption that early detection of cancer via a positive test result like Bavi might help provide carries a parallel to a mammogram positive detection. I disagree.
More relevant is real family experience. My brother in law passed away due to progression of prostate cancer. A sad dynamic is the prostrate screening, PSA test had shown elevated levels, but the lab and clinic did not forward the results (clerical error sent results to file without a report being issued) to the attending doctor or my brother in law. A routine screening three years later showed positive PSA, follow up was expedient, but treatment was too late. Three years later, my sister is a widow, despite trial participation that was credited with prolonging life.
Early cancer detection matters- it can be a life and death difference. Detection of lumps via a mammogram (imaging detection) and positive labeling of the presence of cancer (biochemical marking) is an apples to oranges comparison.
Best wishes and IMO.
KT
It looks like the Russell 3000 cutoff was at 143.6 million. Of course, pls was under a buck.
Best wishes and IMO.
KT
CP, I find Clay Traders analysis very interesting and listen to it whenever he posts for PPHM. Identifying points of support and resistance is the stuff of technical analysis to inform trading. However, presenting the analysis does not strike me as a cue for shorting any more than oberving that a stock bounces off resistance or support does that. It works both ways.
I cost averaged into my current long position in PPHM over several years so the TA is more interesting to me as a means for understanding the recent pps movements. Since the Avid sales growth has been affirmed with expansion plans, there is now company events that should drive the pps to its shareholder value realization. The technical analysis is like describing some of the scenary along the way, LOL.
Best wishes and IMO.
KT
Corporal, as a memory jog, the $600 million math goes like this:
Avid sales potential rises to $100+ million annually AFTER the two, 2000 liter reactors are operational. During the cc, PPHM said they have the order book set for the production for those new reactor vessels, due to install and start up over the next year. Then a sales to price ratio of 6 (refer to previous posts as to source of this ratio) applied to $100 million gives a valuation basis of $600 million, which divided by 300 million shares works out to about $2 pps value basis if/when Avid delivers its planned growth increment.
For now, PPHM indicates FY sales target was increased to $60 to $65 million, applicable to the quarter ending April 30, 2017. That $100 million in sales is in the works for PPHM's next fiscal year. Referencing $60 million and multiplying by 6, valuation "about now" is $360 million or about $1.20 per share. If a low multiplier of 4 is applied, the pps rating drops accordingly and if diagnostics value gets realized, the value rises accordingly.
All quite interesting for a biotech company that has also shown documentation of naked short sales in the period running up to NASDAQ listing dates and the emergence of Ronin facilitating significant accumulation while PPHM preserves cash levels using ATM sales. PPHM reducing their R&D costs to fit within self generated funding is also a factor, where the conference call affirmed the PPHM fifteen month outlook to achieving net profitability. That projection aligns with the $100 million sales potential in the works but doesn't assign value to the third Avid production facility PPHM indicated on the call is also in the works. I suppose that would take another year and deliver growth for the increment beyond $100 million.
All in all, the PPHM argument that Avid sales progress and growth affirms PPHM is undervalued gets reinforcement.
I look at things like Russell index rebalancing coming up in June and laugh a bit, because with or without a reverse split, growing Avid sales based shareholder value probably situates PPHM to get picked up on the Russell again. In past years, last days short selling was in play to try to keep PPHM out. Drama to continue, LOL?
Best wishes and IMO.
KT
CP, I am not clear on how to interpret the Regulation SHO data from FINRA, but here is what posted for the NASDAQ (Q) and NYSE (N). There were no over the counter market postings for PPHM. I am curious about the NYSE volume, as it is a relatively small amount compared to PPHM trading on NASDAQ, but posts a lot of short volume as a proportion of total volume, similar to the NASDAQ. How can one identify what involved naked shorting? Is it the difference between short volume and short exempt volume?
It also seems that, by relative volume, the At the Market Sales by PPHM roughly align with the establishment of a reported position by Ronin. Perhaps, PPHM facilitated the ATM through that path, transferring shares to a single party through the markets?
Best wishes and IMO.
KT
Date| Symbol| Short Volume| Short Exempt Volume| Total Volume| Market
20170315|PPHM|288,394|21,980|1,243,019|Q
20170315|PPHMP|3210|0|4270|Q
20170315|PPHM|17,110|1960|138,544|N
20170315|PPHMP|250|0|250|N
2017-03-15 Open 0.69 Hi 0.71 Low 0.67 Close 0.6987 Volume 2,620,461 From NASDAQ
20170314|PPHM|1,054,600|70,643|3,622,130|Q
20170314|PPHMP|2264|0|2395|Q
20170314|PPHM|82,944|4094|211,181|N
20170314|PPHMP|800|0|1100|N
2017-03-14 Open 0.692 Hi 0.71 low 0.62 Close 0.71 Volume 6,705,477 From NASDAQ
20170313|PPHM|871,131|81,683|3,183,126|Q
20170313|PPHMP|2121|0|2947|Q
20170313|PPHM|71,849|50|261,177|N
20170313|PPHMP|28|0|28|N
2017-03-13 Open 0.655 Hi 0.774 Low 0.65 Close 0.7628 Volume 6,370,291 From NASDAQ
20170310|PPHM|473,080|5502|1,765,204|Q
20170310|PPHMP|3626|0|4286|Q
20170310|PPHM|13,008|2203|67,946|N
20170310|PPHMP|310|0|310|N
2017-03-10 Open 0.6 Hi 0.6549 Low 0.575 Close 0.651 Volume 3,324,248 From NASDAQ
20170309|PPHM|192,894|49,226|2,123,280|Q
20170309|PPHMP|4076|220|10,436|Q
20170309|PPHM|43,038|14,249|166,118|N
20170309|PPHMP|100|0|725|N
2017-03-09 Open 0.651 Hi 0.675 Low 0.6015 Close 0.6106 Volume 4,187,141 From NASDAQ
Shipbuilder, you raised some good, sincere points. Seeing as how I have the same sort of access to information as everybody else, I can only speculate where PPHM is at with their behavior, regarding the support of stock price. Here are some thoughts in that regard that you might want to critique.
1. PPHM has a history of taking measures to preserve cash on hand, presumably sufficient to resist hard ball tactics they may encounter if they run short on cash and need to engage hardship fund raising. The At the Market placements continue to occur when investor interest is up due to pending PPHM business plan activities. We heard this happened again over the last quarter. I consider how the markets would respond if everything else was the same except PPHM had not done the ATM placements? Absent the ATM, levels of cash could be considered at a threshold unsuitable for supporting Avid business operations while the PPHM R&D expenses continue to post while PPHM is winding down trials etc. I view that as a basic rationale for continuing the ATMs while PPHM moves over the next fifteen months to their targeted profitability.
2. PPHM defines their targeted fifteen month outlook profitability as reflecting a version of living within the means of their Avid generation revenues by scaling back R&D work while expanding Avid production.
3. It looks like an $80 million annual Avid sales threshold will make prospects of PPHM self-funding going forward a more "black and white" successful delivery. PPHM just updated that sales are expected to close out the quarter ending April 30 with $60 to $65 million in estimated sales. They also indicate their addition of the two, 2000 liter reaction vessels as setting their two existing mabufacturing facilities as being able to generate $100+ million in Avid sales. That suggests the black and white threshold is set to happen over the next twelve months or so, since PPHM also said they have an order book set to support the two, 2000 liter reactor vessel additions.
4. Diagnostic potential for PPHM technology is getting shared with the international community by respected scientists over the next four weeks or so. The apparent consolidation of the pps we are now observing may need the successful delivery of this information and follow on technical peer acceptance to give a pps boost while the Avid earnings are positioning to cross over to the $100 million plus annual sales threshold.
5. $60 million in sales with a 300 million share count and a 6:1 price to sales ratio works out to be supportive of a share price of about $1.20, to be confirmed when the next PPHM quarterly results are posted. A $100 million sales threshold would support a $2 pps, with the current share count.
Add it all up and I see why PPHM would take measures to preserve cash reserves while at the cusp of posting results like described in 1 to 5 above. Of course, there can be more glitches. PPHM is famous for showing glitches that disappoint, LOL. For example, a collapse in Avid's customer base would be a surprise of that type that, while I don't expect it, could happen. Who knows?
Best wishes and IMO.
KT
Little change? Six years ago, Avid sales were minimal for contributing to PPHM financial strength. Now, $60 to $65 million in Avid sales projected for the fiscal year ending April 30 is a shareholder value game changer.
If there is some "invisible hand" seeking to drive PPHM into the ground, this Avid game changer puts a floor on how low the pps should go if market fundamentals are recognized. A floor? That sixty million is situated to grow to $100+ million after the two, 2000 liter bioreactors go in service and PPHM just told us on the CC yesterday that the production capacity has a supportive order book (yes, I listened to the call). The floor at status quo sales considering Avid only is above a buck pps and is structured to increase in the next fiscal year.
Corporal, there was a segment in the CC where margin for Avid production was explained in a manner that makes sense. That is, the expanson integration is weighing against margins. Their facility that is at full utilization is presenting the larger margin. The newer facility is projected to inprove margins as demonstration runs are confirmed with lab results and they shift to production runs. If you read the transcript, you will see your declining profit margin theory for Avid is not supported.
Best wishes and IMO.
KT
CP, well said.
The growth in Avid sales and the booking of corroborating sales was identified during the CC as substance to justify a 180 day NASDAQ time extension. Will PPHM need to do that?
I observe that PPHM made it clear that they plan to resist doing a reverse split by emphasizing how Avid sales alone should support a pps above a buck and how the NASDAQ petition process allows PPHM assurance of more time than April 10. The NASDAQ documentation of short sales lags a couple weeks and the documentation of naked short sales is a fairly recent tool available to financial investigators, but the existence of both shorting methods was confirmed as in play over the last few weeks. In a practical sense, PPHM has the time needed to wait out the pps to catch up by recognizing Avid sales, for technology presentations at ASCO and elsewhere to demonstrate their value and for appropriate investigation of trading practices to weigh in.
Best wishes and IMO.
KT
Realist, I like the $60 to $65 million updated Avid sales projection for the fiscal year, didn't you? That is up 20% from previous estimates. A price to sales multipler of four to six places shareholder value at $240 million to $390 million. When? The current PPHM quarter that end in April, so about now. Nice huh? The value translates to about $1 pps to about $1.50.
Then there is the two new Avid 2000 liter expansion modules that bring commercial potential of existing Avid production to $100+ million annually, targeted for next year or about a $2 pps equivalent basis. Nice, since that doesn't even assign any value at all to the exosome and diagnostic value you mentioned is set to follow Avid growth contributions to sales. As PPHM managment said on the call today, growth in Avid sales alone gives support to NASDAQ listing being retained without a reverse split. So the April 10 deadline moves to early June and can be petitioned to extend another 180 days if Avid growth value is not being recognized right away ib market valuation.
Developing the mabufacturing capabilities of Avid is contributing a payback to the parent at good timing, isn't it?
Best wishes and IMO.
KT
Couch, when we went through the last RS, there was no guide book about accumulation or exit strategies that made sense to me. I don't see one now either, LOL. I laid out some observations in my earlier posts and am looking to more information being revealed by PPHM that will bring things into better focus. I consider Steve King's statement that PPHM is way undervalued if the Avid sales and diagnostics potential etc. are considered and observe investors are set to get information from PPHM today and over the next couple weeks that should show if there has been substance backing the statement.
Best wishes and IMO.
KT.
N3, at the annual meeting, shareholders gave permission to PPHM to do a reverse split to retain NASDAQ compliance. I am not aware of any permission given for a forward split and it is my understanding that shareholder approval of a FS would be needed.
Best wishes and IMO.
KT
CP, there are indications of major events in the works for PPHM for which I don't understand the implications. Some of this might be due to how I sat out the reading of over 40,000 posts on this board over the last couple years while awaiting for PPHM to reform its fundamentals, LOL. Doing catch up, it appears to me there is an apparent positive change with PPHM's prospects, more impacting to long shareholders than the prospect of a NASDAQ reverse split.
I will summarize what I think I know to be true:
1. Avid sales are on track to post at $80 million annually. They are targeted to continue growing with yet another Avid certified laboratory production capacity expansion in the works. Applying a 6:1 price to sales ratio and dividing by about 250 million shares puts an Avid contribution to PPHM at just under $2 pps-- and growing. The valuation would apply once there is not a quarterly drain on cash due to continued accumulation of losses due to ongoing research expenses and general Administrative overhead, the cessation of which can become the case over the next year.
2. Therapeutic value of PPHM tech like Bavi has gone back into a "black box" since the announcement of the Phase 3 Bavi trial halt. No need to expand on that until PPHM brings forward new information.
3. Diagnostic value of PPHM technology has delivered a successful proof of concept outcome that can expand to multiple indications, TBD. PPHM getting established at supplying less than 1% of that diagnostic market can deliver $500 million to $1 billion plus in annual sales (based on research shared by posters on this board. Prospectively, such sales translated to shareholder value can be equivalent to $12 to $24 pps, but apparently, PPHM needs a partner to help realize that potential. The need for a partner is not a given.
4. At sensitive timing for retaining PPHM NASDAQ listing, the presence of a > 10% shareholder has been announced. The timing also predates a PPHM quarterly earnings call (on Monday) that long investors are looking to for information affirming Avid and PPHM diagnostics prospects (items 1 and 3). There are also upcoming technical conferences at which recent diagnostics testing results are being shared.
5. PPHM has accumulated about $550 million in operating losses. Tax value at a 30% Federal rate and 14% California rate is 44 cents per dollar or just under the equavalent of $1 pps to PPHM if acquired by a Pharma with net earnings.
6. PPHM Short interest had been running very low for about a year until the latest Nasdaq update for the end of February. The reemergence of significant short interest coincides with a pps up movement from below 30 cents to as high as 76 cents per share. Indicated naked shorting has also shown spikes in activity when daily trading has suggested continued up trending of the pps to levels high enough to retain NASDAQ listing compliance without a reverse split ($1 pps), contributing to a Friday, March 10 close at 65 cents pps after the pos had been pushed down to support levels.
This all has me thinking through accumulation and exit strategies.
Best wishes and IMO.
KT
CP, perhaps, the recent 10% of shares accumulation is for purposes of being resold to a, to be announced, collaborating pharma? The trading of last week displayed an early market day concentrated sales volume that dropped the pps, followed by millions of shares traded at the lower pps held in a tight trading range most of the day, followed by a shares purchase and pps rebound that looked like short coverage. That seems like it could fit someone's accumulation pattern.
Might the NASDAQ listing threat simply be getting used to loosen hands while accumulation is underway-- on behalf of others with undisclosed interests at timing when PPHM is not quite ready to announce news that reveals unrealized shareholder value?
Should longs care if a hard ball move is underway to place someone on the PPHM Board in advance of PPHM being able to regain its financial strength to continue operating independently? Of course, yes. Do longs know for sure that PPHM is so situated? No... but.
There are too many tea leaves still needing to be read, it seems. Will PPHM clarify by revealing some cards in their hand next week? If a reverse split is to be averted, it would seem that is necessary. Is it correct that the pps needs to base at above about 80 cents for the pps be able to reverse split its way above the $5 pps threshhold needed for some funds to engage? Should holding a $5 pps enabling Institutions to enter even be a concern for PPHM?
Lots of questions before the cc on Monday, LOL
Best wishes and IMO.
KT
CP, I observe we are at an exciting time as long term PPHM investors, as to me at least, it looks like PPHM managment has helped set up that critical mass where significant shareholder value will soon be realized--- or not. The last time I recall a situation like this is in that pps run up leading into the European Conference where the virtues of Bavi was scheduled to be revealed to the world. Trial mischief was revealed and PPHM went into recovery mode. It is time for PPHM to deliver, as they are able..
Best wishes and IMO,
KT
Cheynew, I count the ten days as being March 27 through 31 and then April 3 through April 7. That would deliver ten trading days that could close above a buck a day before the timing out of the 180 day extension. However, the NASDAQ guidance indicates ten to thirty trading days reestablished at trading above a buck. Thus, I consider March 27 as the start of the last moment for the ten trading days above a buck to fit within the 180 day extension. The NASDAQ letter specifically cited October 10, 2016 as the end of the period originally cited, so the 180 days should count from there.
My observation is that the pps started moving steadily upward after the announcement of the diagnostics study proof of concept success. Why did it move to the upper $0.60s and retreat to where we are now? Considering the significance of value being indicated, I see today's trading range as relatively arbitrary and no reason why the pps should not continue to climb if there is investor buying interest being precipitated by the 100% effectiveness in proof of concept news. I was impressed by the detail provided, where it was clear how there was a clear dissemination between the different categories of benign, malignant and no cancer, but that was for 44 subjects in a proof of concept study.
How does it matter for my investment if PPHM goes through a reverse split in April or not? I don't know what I don't know about undisclosed agendas, but by math, a reverse split should calculate out to the same market value in my account. I don't want a RS to occur because I like having lots of shares. Is that a good reason to not RS, LOL!? I would expect that mischievous trading during a ten day period that would reflect an attempted spoiler outcome through targeted shorting would be the sort of thing that would have the NASDAQ reviewers accept a petition letter for more time. Illegal naked shorting is just that. Otherwise, it is time for PPHM to stand and deliver... My guess is they are ready to do that. We shall see.
Best wishes and IMO.
KT
Hornet Driver,
To clear up calendar count misunderstandings, attached below is the relevant excerpt from the PPHM 8k that reports the NASDAQ delisting warning. It mentions the date for the ongoing 180 day extension as being from October 10, 2016. By calendar counting, the extension appears to time out around April 8, a Saturday (my quick count should be confirmed for correctness). The ten business days with a close above a buck would then need to start by March 27, if reverse split "brinksmanship" is involved.
It is noteworthy that PPHM has a quarterly earnings report and investor update due in mid-March that would provide a good news opportunity to move the pps above a buck if PPHM has the goods to support that. A segment I put in bold in the 8k also indicates that the company may submit a letter of petition for additional time from NASDAQ staff before delisting, but approval of same may not be granted. Regardless, the 180 schedule currently in play is not necessarily the last word for schedule but PPHM has indicated their intention to implement measures to meet the NASDAQ minimum listing requirements.
Another reference is that PPHM had a close at $1.07 on February 25, 2016, after which news about the Phase 3 Bavi trial being halted precipitated the pps drop below a buck. Thus, most of the period below a $1 pps for 30 trading days occurred in March 2016, leading into the April 12 2016 NASDAQ letter notice.
Considering the April 12, 2016 8k release, your point that the first six months grace period goes by unannounced isn't supported. Also, PPHM is currently in their first 180 day extension of the original notice that the share price needs to be brought above a buck with 180 days. Your one year below a buck status comment could prove correct come April 2017 if PPHM trading doesn't rebound above a buck before then. While NASDAQ staff may accept a PPHM request for more time, PPHM is cautioned that there is no guarantees of another extension and PPHM has done the set up work for a prospective Reverse Split, per NASDAQ protocol.
Good luck with your PPHM investment.
Best wishes and IMO.
KT
April 12, 2016 PPHM 8k excerpt:
Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.
Peregrine Pharmaceuticals, Inc. (the “Company”) received a letter from the staff of the Listing Qualifications Department (the “Staff”) of The NASDAQ Stock Market LLC (“NASDAQ”) on April 12, 2016 providing notification that, for the previous 30 consecutive business days, the bid price for the Company’s common stock had closed below the minimum $1.00 per share requirement for continued listing on The NASDAQ Capital Market under NASDAQ’s Listing Rule 5550(a)(2), requiring a minimum bid price of $1.00 per share (the “Minimum Bid Price Requirement”).
The notification of noncompliance has no immediate effect on the listing or trading of the Company’s common stock on The NASDAQ Capital Market. In accordance with NASDAQ Listing Rule 5810(c)(3)(A), if during the 180 calendar days following the date of the notification, or prior to October 10, 2016, the closing bid price of the Company’s common stock is at or above $1.00 for a minimum of 10 consecutive business days, but generally no more than 20 consecutive business days, the Staff will provide the Company with written confirmation of compliance.
If the Company does not achieve compliance with the Minimum Bid Price Requirement by October 10, 2016, the Company may be eligible for an additional 180 calendar days compliance period if the Company meets the continued listing requirement for market value of publicly held shares and all other initial listing standards for The NASDAQ Capital Market, with the exception of the Minimum Bid Price Requirement, and would need to provide written notice of its intention to cure the deficiency during the second compliance period, by effecting a reverse stock split, if necessary. However, if it appears to the Staff that the Company will not be able to cure the deficiency, or if the Company is otherwise not eligible, the Staff would notify the Company that its securities would be subject to delisting. In the event of such notification, the Company may appeal the Staff’s determination to delist its securities, but there can be no assurance the Staff would grant the Company’s request for continued listing.
The Company intends to monitor the closing bid price of its common stock and may, if appropriate, consider implementing available options to regain compliance with the Minimum Bid Price Requirement under the NASDAQ Listing Rules.
CP, Impressive exosome pipeline analysis. Thanks for sharing.
Also, thanks for your answer to my questions about preferred and common. The bundling of common with preferred seems to me to behave too much like a fire sale of PPHM shares. Perhaps, I shouldn't use a derogatory term like fire sale, but PPHM would be moving their limited authorized shares to clear them out of inventory to raise funds. The bundling suggests the 8.33 shares of common conversion rate is not enough to entice new preferred share issues. That is the reality when the common is trading under $3 pps, I suppose. The 10.5% dividend doesn't seem to offset the common stock pps difference from $3, at current levels. We need to see the common stock rise above $3 pps where everyone ought to be happy with their PPHM holdings.
Best wishes and IMO.
KT
CP, you got me thinking the next step of your point again. You mentioned how PPHMP is trending up with the common this time. One reason why this may occur but didn't track before is arbitrage during a buyout would give disproportionate advantage or disadvantage to the preferred issue relative to the common if not kept in parity.
The formula for converting preferred to common is something I have to study to refresh my memory about the ratios (8.33 to 1?, $3 basis) but a buyout party would acquire all the stock issues and the bankers closing the deal and parties holding the preferred stock would expect or need to deliver conversion parity with the common stock.
Can someone refresh memories about how the preferred conversion to common would work in the event of a buyout? Perhaps a $5 pps common price would serve as an example. Would that common price have preferred valued at 5/3 x $25 or about $43 going into a $5 common pps buyout? Confusing to me... but something like that.
Best wishes and IMO.
KT
Andy, Imputed hiring freeze is an interesting observation. Of course, that is anecdotal but interesting, nonetheless. Thanks for sharing.
KT
Realist, the value to an acquiring Pharma from the book losses component of an acquisition would run the same whether the reason for the acquisition becomes number 3 on your list (the targeted company carries shareholder value of interest) or is the sole reason for the acquisition, correct?
$550 million in accumulated operating losses will get whittled down if PPHM begins to show net revenues within the next year or two, reducing the tax value to the acquiring Pharma while increasing the value the Pharma may expect to pay for PPHM. Considering time value of money, a success bound PPHM acquired near term is a bigger carrot for acquisition than waiting for PPHM to see Avid turn their balance sheet positive and for PPHM to find a partner for cancer duagnostics test deployment.
LOL! I will try to find examples of companies acquired for tax value if you can credibly affirm such tax loss value doesn't exist as part of an acquisition negotiated purchase price...
Aren't corporate tax rates targeted for being dropped by the new Administration? That would have the acquisition tax loss value drop, starting the tax year when the change applies. The window of time between PPHM profitability coupled with timing for reduced tax loss value on one end gets bracketed by the February PPHM, research findings announcment of 100% success in the cancer detection proof of concept paper.
Best wishes and IMO.
KT
Bungler,
That explanation is helpful. Thanks!
KT