Avid Bioservices Inc (CDMO)

[JamesGMS]

CP, thank you for your response as excerpted in relevant part below:

So if that is the goal, and it surely also is for GILD, PFE and JNJ/J, then what component would you go after FIRST? Well I would go for the one of which there is only one. And that is Bavituximab. It doesn't has its comparable. If I have that one I can start buying other molecules or make deals if needed. A PD-1/PD-L1 program is not so hard to come by. AstraZeneca for instance is an AFFORDABLE target for GILD, PFE and JNJ/J.

And WHEN would I do it? Well I'd wait until my competitors and those with less pocket depth spend there money to others, bying 10 companies in the hopes one of them has the anti-body that brings something extra to the table. And HOW would I do it. I would make an offer to PPHM that is sufficiently HIGH to keep the smaller players away and only allow my direct 'pocket depth' competitors to compete BUT that is to low for PPHM to accept it. In this way I can stall them while the others spend and I can see WHO has WHAT and what combo I need to beat.

CP, I would agree with your assertion in your first paragraph - However, your second paragraph - not so much.

As time is most certainly of the essence in the sprint to lead the I/O charge, there is no way GILD - or any other truly serious BP - would wait to make their move once their DD is complete. As that would only invite an eventual bidding war as more and more public validation continues to emerge re the breadth and depth of Bavi {and very importantly, its progeny}. And to "make an offer" - knowing PPHM could not accept it - to "stall them" {meaning other BP's} would most certainly NOT be an approach GILD would pursue. As once they identify a molecule they want - AND NEED - they will move with breathtaking speed to either acquire it outright - as was the case with Pharmasett - or they will partner - as would be the case here - to get as big a piece of the Bavi pie - perhaps up to 50% - as possible NOW - with a likely option to purchase more - maybe all - in five to seven years - but of course at then prevailing market value.

Other BP's may not move as rapidly as GILD, but they are not stupid. Should GILD in any way publicly demonstrate their interest and likely intentions in an effort to "stall" other suitors, they would accomplish nothing more than to dramatically increase the cost of any deal they could eventually make with PPHM.

And one last thing - PPHM wants the "right partner" - one that can not only offer them fair value now - and down the road - for what will likely constitute the next "Transformative Cornerstone Molecule" in the I/O space, but also a partner who is enterprenurial, quick footed, and most importantly not wedded to the traditional Big Pharma approach to developing and marketing new drugs. That is not JNJ - that is not PFE - but it fits perfectly with the current reality at GILD.

Thanks again for all your contributions.

James