Replies to post #64257 on NorthWest Biotherapeutics Inc (NWBO)

[Doc logic]

exwannabe,

All evidence points to synergy between checkpoint inhibitors and DC vaccines. That said, those tax writeoffs might be looking good to several companies don't you think? If bankruptcy became a legitimate topic of discussion might someone break ranks and bid before any bankruptcy proceedings could be approved? Based on Wall Street MO, I am guessing that someone would do exactly this. Hence, the tax write offs have more value than those of DNDN.

[Poor Man -]

Why do almost all failed bios with these TLCFs not provide any shareholder benefit on such? - Ex

That's your narrative, not mine. You want to make a case for bankruptcy, which is an entirely different analysis that also applies to DNDN. My premise is that NWBO continues as a going concern, and thereby retains significant value in what it holds in NLCF to a potential seller.

The statutory rate when including state taxes is closer to 40%, which for some reason you don't care to include. With $446 million in NLCFs (net of $12 million in tax credits), that provides $178 million in savings. Then add the tax credits of $12 million to the $178 million, providing for approximately $190 million in tax saving based on losses through FY15, about $1.85 a share. Now, we can assume another $30 million to $50 million in loss carry forward in FY16 (we're already approaching the end of the 2nd quarter) that would provide another $12 to $16 million in tax savings, which gets to the $2 per share.

Given that the company can use the carry forwards against all taxable income starting in year 1, NWBO might actually fully utilize those losses and tax credit within just a few years of commercialization. In fact, another biotech might be able to apply those immediately, depending on what eligible offsets to income would be available in a merger. In that case, the discount would be minimal.

It's not a reach that those carry forward could be in the neighborhood of $2 a share. The $3 figure is too much of an estimate, but the point is as a going concern there is realizable value to NWBO (or potential buyer) as a going concern. Frankly, even $1 share is significant value given where the stock is trading now.

Although dilution is a real concern, the bankruptcy narrative is nonsense in my view.