my take on all of this, all IMO
after 2 sleepless nights and a lot of reading posts and thinking I am ready to share my thoughts. Thank you all for posting, some stuff is really useful. I place myself somewhere between MH and Realist.
I am not a scientist, I have been in trading/sales for IBs and Hedge Funds for almost 40 years.
You can tell me PS/Bavi is the holy grail worth billions or you can tell me PS/Bavi is pseudo science worth nothing. I don't know the answer. The market says the IP is actually worth less than nothing.
To say that stopping SUNRISE was a smart thing to do and that Bavi worked as expected is insult to injury.
But still, I can see the positives of what happened.
We will save a lot of money. We will have some more data, maybe useful to fine tune future trial specs. One day maybe we will find out that stopping at first look-in was a good thing.
If Bavi/IO works, why bother about Bavi/Chemo? Everybody says I/O is the future. Bavi/IO would kill Bavi/Chemo, we would be cannibalizing ourselves. And you remember DNDN? They had approval and still failed on delivering.
Now the game for Peregrine has changed.No more go alone. Back to being a "clinical stage micro biotech", but luckily with AVID.
It was a bold, courageous, somewhat admirable but also crazy move to go to a fully fledged phase III trial being a micro biotech.
I do not blame them. As we used to say in the eighties at Drexel Burnham: "no guts, no glory".
Now the interesting stuff. SP reaction on Friday was totally unusual. I posted that before and also some others realised that the sp should have traded differently. I expected wild swings between 30 and 50 with a lot of day traders and 50MM volume.
No, somebody was there bidding at around 40.
I have one explanation which makes everything understandable and could show us the way forward: Dart!
They are not mother Teresa. Their job is to be smart and make money. Look at Argentina Bonds.
They sit on a pile of shares at 107 or so. They have done a lenghty dd. They perfectly know that pphm break up value is at least what they paid. I can imagine they are buying now.
Spending another 20mm (pocket money for them) would bring them to 40mm shares at an average of 60-70.
They will not sit idle, they will be an active shareholder.
So it could well be that Dart will make sure that pphm does the obvious:
cut costs dramatically, I don't know if we can be viable on a break even basis at this point in time but I believe it's possible. We also have some cash left to bridge until Avid makes more money.
look at SUNRISE data and make the best out of it
give up on chemo altogether except if we can run stuff for little money
continue with the collaborations, they are not that costly and Birge on tour might help.
concentrate on Bavi/IO, I hope the AZN trial can go ahead as planned. It's not blinded, so we will have data soon.
End of 2016: if Bavi/IO works, we can do a deal and there is a chance sp goes double digit but no astronomical value. We have seen BP paying 5-7bln for Phase I private companies nobody has ever heard about, so there is some hope.
If Bavi/IO is not working there is still some cash, Avid and tax loss carry forward and maybe some value in IP.
That should fetch at least 1.5$ a share. So for Dart it's a no brainer. Worst case they still double their money.
Let's see what the sp will do in the next couple of weeks and what we will hear in the cc. Maybe there is a bottom at 40-50, so I guess I will buy some more. My mood is definitely better now.
Kind regard and have a nice Sunday
