Biotech Values

[Mpower]

Controversial Topic: MNTA Management Not Doing Enough To Educate Market about Company Accomplishments?

Until today, I have refrained from bringing up this subject, but I have become increasingly concerned about Momenta's strategy (? - if one exists) in managing market perceptions about the co. post mL-approval. Simply put, the market is severely undervaluing Momenta, and management has done little (outside of participation in a few healthcare conferences) to rectify this flawed perception. In essence, i think MNTA has a strong story to tell (and FDA's validation of their technology to accompany the story), but management is unable to effectively communicate the story to the investing public. Moreover, with insiders selling massive amounts of stock post-approval (370k shares -- approximately 7.5 million dollars worth), management has not only not helped correct market perceptions -- they are actually feeding into speculative negativity.

While I believe that management should not look to the PPS (on a daily or weekly basis) to make business decisions, I do believe managements ambivalence to the recent price decline in the poses a danger to shareholders and that shareholders should express their dissatisfaction. Why?

For one, in the event that the company needs to raise money (e.g. To fund the M118 program), dilution to existing shareholders would be far more severe at current levels than at the 52-week high. Secondly, the threat of a lowball takeover increases significantly, and could compromise those of us who recognize the true long-term potential of the company. Third, it was Craig Wheeler on the post-approval conference call, celebrating the accomplishment, and thanking shareholders for sticking with the company over the last few years -- but I ask Craig, what has he done to communicate this success and have it reflected in the valuation of the company.

What an amazing scenario: MNTA trading @ 13.70 nearly four months after receiving sole generic approval for Lovenox, in the midst of a strong end-of-year market rally.

Management needs to step up and provide some leadership. One recent win for shareholders -- management stop dumping their shares on the open market in late September -- painful to watch them sell so many shares since approval in July. Have they ever considered buying a share on the open market -- that would really be the day! Without strong leadership (good communication skills) , MNTA will have a heck of a time refuting the bear case for many years to come. Lets hope that the partnership helps!