Innovation Pharmaceuticals Inc (IPIX)

[loanranger]

"largest creditor is LEO."
As of 6/30 that was probably true but we owe a CRO SOMETHING, we just haven't been told how much. Unrelated party payables at 6/30 were about $1.5M and there could have been some money due that CRO in accrued expenses as well. We don't know how much, if anything, has been billed since 6/30. One would HOPE that whatever the liability was at 6/30 was fully reflected but the Company raised the specter of "cost overruns" which is something that is inherently unexpected (although the auditors should have seen to it that that was done).

Apart from all of that the fact that the largest unsecured creditor is an insider who isn't likely to force a bankruptcy doesn't preclude other creditors from doing so...people who have provided goods and services, large and small, expect to be paid. There are salaries due Officers that would be preference items.

This explanation is unnecessarily complicated:
"ASSETS greater than DEBT is not an entity which is subject to Bankruptcy... A company that cannot pay its bills on a cash flow basis (which has not been demonstrated) could be "insolvent" but not a bankrupt company.
DEBT greater than ASSET...is an entity subject to Bankruptcy...if they so choose. Otherwise it has to be forced upon them."

The relationship between debts and assets has a marginal bearing on the potential for bankruptcy, which is a function of liquidity. Simply put, if cash is inadequate to pay creditors then bankruptcy is a risk.

I AM NOT SAYING THAT IT IS LIKELY.

But the quality of the assets and the ability to liquidate them is every bit as important as who the creditors are. Technically the IPIX Balance Sheet shows the Company's largest asset as its Patent costs, net of Amortization. Those can't be liquidated, but the value that they represent is purportedly significant. There are no other significant non-cash assets.

So either some of that IP value has to be recognized in the form of cash or funds have to be raised some other way in order to avoid the B word...and I expect that that will need a resolution within a month based on the last known cash position. It may not be likely but it's not farfetched either. Frankly I never thought that I'd see the day.