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The market cap, fully diluted, is over $2.0 billion today. I would say that's a pretty high valuation for a GBM only drug that hasn't released Phase III data yet and with some doubts about how clean the data may be and what the ultimate patient population may be based on biomarker data.
Compare this to the $750 million market cap for CVM, which is also about to release Phase III trial results, also has a potential platform technology, and can scale much faster with their off-the-shelf immunotherapy. Oh yeah, CVM is listed on an actual exchange.
LP has mentioned plenty of times that NWBO thinks DCVAX-L may be a platform technology. She's not going to miss the opportunity to tell that story if it's warranted, based on the Phase III results.
No, there is not a lack of understanding of the alleged process. There is doubt that the alleged process is actually what is causing the delay and criticism of the process if that is actually what the company is doing.
No biotech has ever waited to release TLD in connection with a journal article. You know why? Because the journal article will contain a full analysis of the data! So what the company is doing by implying that they are waiting to release TLD until a journal is ready to publish is that they aren't giving us TLD, they are really giving us the full data. But since I don't think that is what is actually happening, I'm frustrated/angry because they are misleading everyone by allowing investors to think that that is what the hold up on TLD is all about. The idea that DI has allowed to take root, that they are holding on to TLD to release in connection with a journal article, is total BS.
I can assure you, without a shadow of a doubt, that if TLD is positive, the valuation will immediately reflect something beyond GBM and the market will put at least some value on the platform potential of DCVAX-L. That's how biotech stocks work. And everyone already knows it's a potential platform technology.
For all of their shortcomings, NWBO certainly understands the potential of DCVAX-L. The key is clean data that leaves no doubt that the various RAs will approve it. If they have that, the stock price will take care of itself, although the company probably needs to get uplisted first to maximize it's market cap pending FDA approval.
Physicians prescribe off-label uses of medications and therapies all the time. The issue is whether insurance companies will cover off-label uses, and they usually don't.
I don't have any insight on how likely it is that a physician will recommend DCVAX-L for another solid tumor besides GBM, but at least some patients will ask for it. I know I would if I had the funds and thought there was any chance it might extend my life.
I think there is a distinct chance that something is really wrong, but I'm hopeful the delay is something along the lines of getting feedback from the FDA that they have "enough" to submit a BLA for rGBM in addition to nGBM. Or something like that...even then, those kind of discussions don't justify delaying TLD, in my opinion.
I will always be in the camp that you release TLD when you have it and let the data speak for itself. Trying to time the release for the benefit of the stock price in the short term just doesn't make any sense. Too much can go wrong. There is a reason that no other biotech has ever released TLD in this manner.
This is a really weird situation, in so many ways. Hopefully it has a good outcome for both future patients and investors.
The 10-K deadline is March 31 since NWBO is a smaller reporting company (revenues of less than $100 million) and had a public float of less than $700 million on June 30, 2020.
I agree that mid-March would be, at this point, an ideal time to release TLD. If they don't get TLD out at least a week before they file the 10-K, then they can't do an equity offering with their existing S-3 because of all of the late 10-Qs last year. The company would prefer to do an offering with the S-3 because it's easier and the transaction costs are less. I also know they would rather release TLD before filing the proxy, which will almost certainly seek shareholder approval for a reverse split to deal with the current issue surrounding their authorized share amount, which most retail investors will be angry about, even though they shouldn't be in this particular instance.
The thing is, if they are waiting for a third party for something, which is what I suspect is the case (i.e., feedback from the FDA), then March will pass without TLD and we will be looking to the next potential date that we think will correspond with when the company should release TLD. This is getting old, and every time I think about it, it makes me angry, because their supposed timing of the release of TLD in connection with a journal article is totally ridiculous. It's so ridiculous that I can't believe it is true. So if that's not the real reason for the hold up, what in the heck is it? It has to be that they are waiting on the FDA to bless something they want to say in connection with the data release...that has to be it, otherwise they would move forward since they've likely been unblinded since November.
Well, studying and treating GBM is what she's dedicated the majority of her professional career to, so even though she may not be "expecting" a cure for GBM at this point in her career, you can bet she's still trying. Also, we've made tremendous progress on the treatment of many different cancers. I have 2 members of my family who have been in remission for over 20 years...I would call them "cured" from cancer, even if there's not a universal silver bullet to cure cancer. I think you know what I'm getting at.
With respect to this statement:
This is a confusing statement to me as well. She definitely seems jaded by the clinical trial process, and it's also a reasonable inference to conclude that she's become jaded with NWBO specifically. Her statement regarding NWBO's patent strategy certainly suggests that she's not a fan of the company. But is that really all that surprising? She's trying to cure cancer, not make money. I think it's safe to say that Dr. Liau is the most frustrated person in the world over the delay in getting DCVAX-L approved...she's bound to place at least some of the blame for the delay on NWBO, rightly or wrongly. And as others have pointed out, she's not a patent attorney. So even though she may have some kind of moral objection to NWBO's patent strategy, that doesn't invalidate their existing patents.
At the end of the day, I think what she's getting at is that DCVAX-L is not a cure for most people and thus, her mission is not complete and she's still searching for an answer. However, if DCVAX-L is a cure for some people, and if it extends life in enough other people, then DCVAX-L will get approved and if the patient population is large enough, it will be a home run financially, especially if it works for other indications, which it should.
Fun fact of the day: Malloy's wife is still alive 2 years after her diagnosis, which is 16 months longer than she was originally told she had to live. How wonderful for the Malloy family! I pray that she continues to stay healthy.
NWBO's 10-K is due March 31.
No, I did not know those things. I've never heard of a CDMO owning a patent jointly with a client...I would think that would be verboten, since CDMOs should be agnostic with respect to their clients' products, and a financial interest in a client creates an apparent conflict of interest. I don't know much about the CDMO world, so maybe this kind of thing happens all of the time and I'm just unaware?
I don't believe there is any risk to sharing the DCVAX-L secret sauce with another reputable CDMO, as guarding its client's secrets is paramount to the success of every CDMO. But again, I don't know the CDMO world so maybe there are instances where a CDMO stole a client's IP?
I can't opine on whether the patents NWBO and Cognate jointly own would require NWBO to stay with Cognate. It seems reasonable to think that NWBO would stay with Cognate anyway, at least for the foreseeable future, just because I'm sure that it would take a lot of time, money and effort to move, but if that relationship is so critical, I'm surprised that the 10-K risk factors don't address the joint IP issue specifically. But even if NWBO has to stay with Cognate, I still don't think the valuation of Cognate has anything to do with NWBO, just because without knowing the results of the Phase III, you can't justify a premium for DCVAX-L, or at least a sophisticated buyer wouldn't put a premium on it. I guess it's possible that DCVAX-L is the big upside they are counting on. Regardless, I'm sure Charles River is rooting for DCVAX-L, just like we are.
Y'all are BOTH dead wrong, for I am the trigger and I'm close to ejecting as well. It's not the opportunity cost that bothers me, it's the possibility of a huge decline in the stock price when we do get TLD (assuming we ever do).
Something seems very wrong here. How can smart people think that it would be a good idea to try to time the release of TLD to coincide with a journal article, conference participation, etc., when to do so means delaying the release of TLD for months? I just don't think that is actually what is going on. They can't be that stupid. There are many reasons that no company in history has ever done it this way.
You should release positive or negative TLD within days of receiving it. Timing the release of TLD to try to manipulate the stock price is a terrible idea and it won't work. The data is the data; they can't manipulate it or spin it...it is what it is and a journal article won't do anything for the stock price. If the data shows that the drug is approvable and the patient population is high enough, then the price will rise. If the data shows that the drug is approvable, but the patient population is too low to support a $2.2 billion market cap (fully diluted), then the price will fall. If the data shows that the drug is not approvable, or there are serious questions about whether it will be approved, or whether they will need to do another trial, then the stock price will drop like a rock back to $0.20s or lower.
A journal article isn't going to do squat when it comes to the AFs of the world. Similarly, investors aren't going to make an investment decision because of a journal article. Peer reviewed scientific articles are incredibly important, but NOT to investors, not directly at least.
To use the Amarin example that Senti gave, it wasn't the lack of a journal article that caused the decline in the stock price...it was questions about the trial design (i.e., the mineral oil issue) that could only be definitively answered by the FDA. Also, it took about 4 months for the FUD to clear...NWBO will have to go through something like this too, no matter what a journal says. Pretty much all small biotechs do, unless they are acquired first. Amarin was able to do their post-data offering at a good price, so the 4 month dip in the stock price was nothing but a chance for people to load up on the stock, which they did, until that pesky IP issue reared its ugly head. Would NWBO really delay the release of positive TLD because they were afraid of a short attack and a temporary decline in the stock price from its immediate post TLD high? Surely not...especially if they are sitting on a game-changing platform technology they know will ultimately be worth billions.
I'm telling you, the delay in TLD is related to something else besides waiting on confirmation of journal publication. Maybe they are still analyzing. Maybe they are waiting on the FDA for something before they make a statement, like maybe it's related to questions about the appropriate Phase III trials to use as real world control groups...I don't know. I just know that I'm having a hard time ignoring the multiple red flags with this company.
Investing in NWBO is like eating at a dive restaurant that you know is going be a little dirty, but you are OK with it because it's part of the charm and you've heard the food is delicious. Then, we you get there, it's a little dirtier than you were expecting, but you order anyway, because the food is supposed to be delicious. Then, while you are waiting, you see a couple cockroaches scurrying around...then later, a couple rats running around in broad daylight. Do you stay for the food you ordered and already paid for, or do you cut your losses and get out of there?
pqr, I respectfully disagree with you. As for their securities counsel, and I'm assuming you mean Gibson Dunn, rather than LG, what they would "sign off" on and what they wouldn't is totally irrelevant. I can assure you that if LP wanted to issue a letter to shareholders as I generally described, she most certainly could have, and Gibson Dunn would have been more than happy to assist in that endeavor.
Look, I don't need a letter. But I'm not the normal retail investor, either. I recognize that they have done a terrible job in the past of updating shareholders and meeting timelines that they themselves established. So I don't think it's too much to ask for them to be considerate to their largely retail shareholder base by providing some kind of an update, even if it's just to say we remember you guys and we're working hard. It's cool if you disagree and think a letter or some other form of communication isn't necessary or appropriate. Reasonable people can disagree on this subject. I understand why they haven't communicated since the Oct. 5 press release (other than to certain individual shareholders like the whole December warrant extension debacle), I just don't agree with that decision.
Well, since you have multiple important calls... ;).
All that I'm saying is there is a big distinction between their advisors guiding them on the interpretation of the data and management's responsibility to determine when and how to inform shareholders...as a public company, that's a fiduciary duty that can't be outsourced. If the interpretation is not complete, or they are waiting on 3rd parties for something, which is what I suspect, then fine. But if they let their advisors tell them when and how to release TLD, that is just ridiculous.
Waiting for a journal to publish the data just won't move the needle when it comes to short attacks. It's crazy to think otherwise. The results will speak for themselves, whether released in a PR or journal article. NWBO is not special...there is no reason they need to be the first biotech in history to release TLD through a journal article. Management knows this...they're running with the journal publication excuse while they wait on whatever the real reason is. Hopefully it's like Flipper thinks and they have submitted an application for approval in the UK or maybe it's confirmation from the FDA that they can submit a BLA for rGBM or something like that...I think those things are unlikely, but they seem way more likely than waiting for publication of a journal article.
Please point me to the press release where they indicated that their "advisors" were responsible for determining how and when TLD would be released.
Relying on experts to provide guidance on regulatory matters and the SAP is absolutely something they should do. Especially since they don't have anyone on the payroll that has ever brought a drug this far, at least none of their top management has ever been involved in a BLA filing, as far as I can tell.
But relying on medical and regulatory professionals' advice with respect to how and when to release TLD is not something that a reasonable investor could ever anticipate because, to my knowledge, it's never happened before.
I mean, if they are waiting to hear back from the FDA or something, because they don't want to say something that creates a regulatory problem for them, OK, I get it. But that's not the same as delaying TLD until a journal article is published, which is what the backchannels have suggested is what the company is doing, at the advice of their "advisors."
Again, it wouldn't be hard to calm the masses. A basic shareholder letter that says nothing material, but gives comfort that they are still alive and working on something important would have done the trick.
Look, we as shareholders have a right to be angry about how management has treated this company. 37 late SEC filings, 1.4 billion shares and derivative instruments outstanding when only 1.2 billion are authorized, being on the OTC with no chance of uplisting in the next couple months, etc. These are all unacceptable things that they are responsible for. It's a very poorly run company, and it's not all the fault of short sellers.
I think the hardest thing about holding this stock and not selling for a modest gain is that if this turns out poorly, I will have known better. It is the platform potential of this stock that is keeping me here...the understanding that if DCVAX-L works, it will work for other indications, and that should give us a value of at least $8.0 billion, as that should be a floor for any potential acquisition. But there are so many red flags that I know and understand are HUGE red flags...I'm going to be very mad at myself if I ignored the obvious warning signs and this turns out to be a bust, or the patient population is too low to justify what is already a very high pre-data release market cap, etc. My guess is that many other investors feel the same way. It is this emotional component of investing that is so tough for us retail shareholders in this particular investment, or at least it's tough for me. Something just doesn't add up here, but as I've said before, I don't think it's actually fraud, so I'm still betting that there is a small chance they have hit a home run and that whatever the delay is related to the spectacular nature of the data and not the mediocre...if TLD was a total bust, we would know.
This is a very curious post...I have 2 questions if you would be so kind as to answer.
First, why are you stating that you believe shareholders are threatening DI's family? If this is actually happening, it's criminal and should be prosecuted.
Second, how do you know that their "advisors" are the ones that are responsible for the delay in releasing TLD?
Your post implies that you have spoken with the company and they have told you these things, or at least implied them...is this accurate?
In my opinion, the company should have put out a letter to shareholders that gave some guidance on the process. The October 5 press release is too vague, and it doesn't jive with earlier statements from the company about date release. It wouldn't have hurt to say, for example, "We have decided to delay the release of TLD while we explore publication of the data in a peer reviewed journal. However, there is no guaranty that such publication will occur, or that it will occur on a timeline that is acceptable to us, in which event we will move forward with a standalone TLD release. For this reason, we cannot give guidance on a timeline for release of TLD. We want our shareholders to know that while you are waiting for TLD, we at the company continue to work tirelessly to advance DCVAX-L and are excited about the future." Then, DI could point to this communication instead of whatever the October 5 press release was intended to convey. They have made this waiting process needlessly difficult and anxiety-inducing for many. It has been a disservice to shareholders. I'm hoping it's just paranoia and not something more desperate or possibly nefarious. They didn't have to say anything to pump the stock, but reminding everyone that they are still alive and that they remember this is a public company with largely retail stockholders that they owe multiple fiduciary duties to would have been a nice gesture.
Understood marzan and thank you for your perspective. I'm certainly NOT a scientist! This is why these boards can be so useful...lots of different people with lots of different backgrounds.
By the way, I'm sorry about your recent loss of your mother.
Do you understand that Multikine and DCVAX-L are not competing products?
Multikine is given pre-surgery. In theory, a patient could get Multikine prior to the resection surgery, then DCVAX-L after. They are both non-toxic and have not had any reported safety issues.
If both Multikine and DCVAX-L hit their primary endpoints, both stocks are going to go nuts because each of these treatments should work for all other sold tumors. They are both platform technologies that would likely become SOC across many indications.
One big advantage that Multikine has over DCVAX-L is that it's way easier and cheaper to manufacture than DCVAX-L, since it's an "off the shelf" compound. Another big advantage is that CVM is in much better shape financially and is ready to go into overdrive on data release, while NWBO has a number of housekeeping things to take care of before they can uplist and the stock can realize its true potential.
I own slightly more NWBO than CVM, but I think the market potential is higher for CVM and that CVM's market cap will exceed NWBO's in the near term, assuming both release positive data. Today, CVM's market cap is $890 million, while NWBO's is $1.3 billion. In my opinion, CVM is a way better value. The patient population for H&N cancer is way larger than GBM and they have their manufacturing squared away and are ready to scale.
Thanks for sharing this, hope4. Go Linda, GO!
No, I don't think a lack of cash will be a driving force behind their decisions on when to release TLD. That doesn't fit with their narrative regarding "one shot" to get it right and the idea that they are waiting to release TLD in connection with a journal article.
They are running on fumes, but they are used to that. And yes, between warrant exercises and personal loans to the company that executives regularly make, I'm sure they can make it for a couple more months at least.
With respect to timing, I think they want TLD out before their 10-K is due so they can use the S-3 they have on file and take down whatever is left (I can't remember off the top of my head). If TLD isn't ready by then, then they would have to go the S-1 route, which is more expensive and will take more time. Not the end of the world if they can't use the S-3, but I would think they would push for that, if it's possible. They will definitely raise capital shortly after TLD. That's a given.
I find it hard to believe they would share TLD (or full data at this point) with a potential partner or purchaser without disclosing TLD to the public first. So much could go wrong with that approach, and it wouldn't let them get full value for the platform. So any partnership or buyout will likely be months away from TLD, at a minimum. Which means they will need to hire a bunch of people and spend a bunch of money getting ready for approval and commercialization. This would be a monumental undertaking for a company with approximately 10 employees, none with experience in this phase of a biotech company. Hopefully LP will step down from the CEO role and handover the reigns to someone that is experienced in building a team from scratch and that has a history of successfully launching new products. She should remain Chairman and sit back and watch her baby grow up.
DI is right about CVM.
I LOL'ed at this: "I thought we talked about this type of email."
NWBO has basically no outstanding short interest...it's less than 1% of shares outstanding. There won't be a short squeeze here.
No. They won't be uplisting anytime soon. They would have to increase shareholder equity by something like $300 million...and the only way to do that soon is to issue more equity, which they wouldn't do and isn't even possible in the near term.
It's going to be interesting to see how they address the uplist problem. Good data will give them options, but even then, it can't happen overnight, or at least I'm not aware of a way that it could. I think it's more likely that the company is sold prior to uplisting.
Agree 100%. But if they aren't going to be clinical for much longer, why hire them now? I guess it's not that big of a deal to dump them next year or the year after. I'll refrain from speculating further about this.
Thanks for responding.
This is possible. I don't think it's likely, but it's certainly possible.
I like this potential scenario way more than thinking about the other potential scenarios that needing to save a couple hundred grand suggest to me (when they are on the eve of revolutionizing cancer treatment).
It's reasonable to fire Marcum. It's the hiring of this particular firm that I think is strange. None of their biotech clients that I looked at have any revenues...their other clients that I looked at that do have actual revenues are small. Like below $50 million. I didn't check them all, but I checked a good number of them.
Well, that's encouraging, Poor Man, thanks. I agree with you 100% RE quality of the local office and individual partners. I'm sure they are competent, but in my experience, it's unusual to choose a small time firm if you are big time (or you are about to be).
At least this is consistent with management's trend of being "unusual."
@kabunushi, sorry for the late reply to this and apologies in advance for bringing up a subject that's been beaten to death and that everyone has moved on from, but you asked, so here you go:
Example of Form 4 showing gifts and trusts
Another Example
There are very good reasons for insiders to disclose the specifics with respect to gifted securities and securities held in trusts. I'm not going to make any more comments about the situation, other than to say that the filing indicates to me that we are still weeks to months away from TLD, which fits with other posters' comments regarding the company choosing to release TLD in connection with a journal article, and them having at least some rough idea of the timeline for that.
If by interesting, you mean incorrect, then yes, it is interesting.
I know Gandalf isn't trying to mislead anyone, but it's clear from the Form 4 filing that he is transferring ownership of options granted to him in 2017 to someone/something. He was not just awarded those options...read the Form 4.
Like I said earlier, the problem with the Form 4 is it doesn't explain in the FN exactly where the options have been "gifted." Typically, if an NEO transfers shares to a family trust, that specific information is included in the FN and the NEO will continue to report on the securities via a separate column in the Form 4 noting that these securities are held indirectly in a trust and disclaiming beneficial ownership of such securities (if that is appropriate given the nature of the trust). The transfer of options to the trust is the "gift" for Form 4 reporting purposes.
100% correct Gus1212!