Pre-Reverse Split price? A few thoughts...
Folks are speculating on the eventual price of a reverse split. This is the wrong thing to focus on. The real question is "why is ACTC" engineering a reverse split at this time??? And of course the answer would lead us to understand their financial needs more clearly.
As of year end, they had cash & equivalents of $13.4 million on hand. They burnt an average of $3.4 million a quarter last year. This gives them just under 4 quarters of burn left. Assuming that they probably burned another $3.4 million in Q1, this leaves them with $10 million left.
Some have pointed out that they can tap various funds available for their lab expense. Say there is an additional $20 million through various sources. This leaves them with $30 million in funds.
Yet, the real cost of running trials is probably a million+ a month after purchasing the site's time to inject/doctors to monitor and tests required for measuring and following up on the patients.
Thus, I'd have to say that their cash projections are problematic at this point. We can't tell what is their real cash need.
Bottom line: how much cash does the Company really need to stay afloat over the next 2 years? $25 million? $50 million? $100 million or even $300 million? Now those are the kinds of numbers the Rabin has to finally decide upon with Doctors Langer and Lanza. How can they make any traction at all with so many products unless they begin to joint-develop the trials ahead with so many favorable indications.
Either we get diluted with any cash funding or we lose profits by sharing revenues. So, what's the answer?
Thus, the softness in the share price goes beyond the Annual Shareholders' Meeting if the cash strategies are not clarified.
AI
