BOOMER: In analyzing whether to bail on this stock I personally concluded that the intellectual property of the company was not as valuable as many believe it to be. Their only US Patent on ssDNA would run out by the time CYGX ever got around to trying to exploit it. Let's say they filed an IND for Simplivir tomorrow. Assuming the best case scenario it would take 5 years just to get it through Phase I and Phase II studies. (Of course their financial picture makes the best case scenario a distant dream at this point.) Then they would need a well funded partner to do Phase III studies. What deep pocket BigPharma would invest hundreds of millions on partnering a drug whose patent would expire before it could be marketed? Patents are nice to have. But there is a defined window within which to exploit the exclusivity. CYGX has been sitting on the ssDNA patent for years now and has failed to even file an IND. The window of exclusivity is closing.
Then there is the issue of the synDNA patent that has been filed. I continue to believe that they will never gain patent protection for synDNA. In my opinion it is only a refined and expanded form of PCR which was discovered in 1983. It is open technology now. Vical, which is a much more advanced company with far greater resources has also developed a similar process. I took a course in Patent Law. I got an "A" in the class in fact. CYGX did not discover a novel process. They took a well known process (what is termed "prior art") and they refined and expanded upon it. A Patent Examiner will conclude that the CYGX enhancement was a forseeable expansion of the prior art and the vast majority of CYGX's Patent application will be rejected. I have bet money on it by selling my shares in CYGX. Once Vical came out with their announcement of a similar process I concluded that it was "game-set-match" with this company and resolved to look reality in the eye and sell out.
( From Wikepedia:
"The polymerase chain reaction (PCR) is a biochemistry and molecular biology technique[1] for exponentially amplifying a fragment of DNA, via enzymatic replication, without using a living organism (such as E. coli or yeast). PCR can be used for amplification of a single or few copies of a piece of DNA across several orders of magnitude, generating millions or more copies of the DNA piece. As PCR is an in vitro technique, it can be performed without restrictions on the form of DNA, and it can be extensively modified to perform a wide array of genetic manipulations.
Developed in 1983 by Kary Mullis, PCR is now a common technique used in medical and biological research labs for a variety of tasks, such as the sequencing of genes and the diagnosis of hereditary diseases, the identification of genetic fingerprints (used in forensics and paternity testing), the detection and diagnosis of infectious diseases, and the creation of transgenic organisms. Mullis, who won the Nobel Prize for his work on PCR, credits the psychedelic drug LSD for his invention of the technique."
So the intellectual property is not as valuable as many here hope, at least in my opinion. My best guess is that there would be a merger or buyout before full bankruptcy would occur. The PHD's would follow the remnants of the company and Malcolm would get some payout for his troubles. I don't see him taking the remnants of the company to start anew under an corporate alias. He couldn't pull this thing together the first time. He'll take a payout and be gone. The scientists will try their luck under new management. They certainly couldn't do any worse.
