Replies to post #75023 on Ariad Pharmaceuticals Inc fka ARIA

[Whosetosay]

Sikm, Interesting references you have brought back. The 2015 post in particular points out how little credit should go to Denner and PP for their 6 month gestation of a strategic plan. It is almost word for word identical to the one HB presented in 2015.

The one thing that Denner did do was hire Elona. That had a $1 speculation impact. The rest was '113 advancing, something that Denner didn't have a single thing to do with.

br, thanks for reminding folks I have been hammering Ariad for years to raise prices on Ponatinib. Now that they have finally seen the light I showed them again in late 2015, Pona revs will play a more significant role. Back in 2014, the BoD flat out rejected my call for price rises. From the 2014 AGM, I updated this ihub community
:

Management rejected my call for Iclusig true-orphan-drug pricing much higher than $125,000/year. They had studied the issue extensively before commercial availability, and do not want to alienate doc and patient communities with high prices, even temporarily (while we have the limited US label and continue the earlier line pursuit.)

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=103734317

Back then, I hadn't yet figured Denner out. I have his number now. For those that wonder, I'm no fan of Denner's.

Over the past 3 years I have hammered Ariad management to get rid of the legacy BoD, much less dump Maria Cantor, change compensation policies, and increase Pona's price.

In October of last year, I wrote a detailed letter reiterating all these topics. It's as if Denner in 2016 went point by point down the plan and executed every suggestion. As for the pricing one:

7. For the BoD. At the 2014 Ariad AGM, I had a conversation with a BoD who I believe was Wayne Wilson. He rejected out of hand my suggestion to raise Ponatinib prices to true orphan status pricing level, instead claiming reliance on consultants the BoD utilized in determining pricing. Given the recent developments around Turing Pharmaceuticals and Valeant and the emerging politics, the window for that sort of move may have closed somewhat. Still, Ponatinib is still limited to very small patient population and that won’t change for several years. Fortunately, it is still on patent. On a recent piece about Turing, CNBC published a list of more than 10 on-patent orphan drugs (not compounds), each purported to serve many more chronic patient populations than Ponatinib, and costing in the neighborhood of $500,000/year. In the nearly 2 years that have passed since the more limited Iclusig label, $50M-$100M or more revenue could have been achieved by Ariad.
• Given that Ariad can always lower the price, why hasn’t Ariad yet raised significantly the price of Iclusig in the U.S to higher permissible orphan drug levels?
At the 2014 AGM in the same conversation, the BoD member also said that the company would again raise more funding through equity sales as the pps was expected to rise with news on ‘788 and ‘113. Those rises have clearly not happened. There has been no news on either drug that has moved the needle. Our WACC is not really calculable, but we must pay for funding and debt at effective rates far in excess of 10%. Yet the company has announced it sees b/e in 2018 primarily on the back of Ponatinib, whose sales numbers are sluggish at best, to be boosted presumably in 2015 by an unsustained, one-time recognition of past European sales.
• Is the company goal truly to remain independent? If so, what is the long term funding plan? (Please be specific, because the math and current path suggested by Ariad just doesn’t add up for seasoned financial analysts who see a buy out as the only hope for survival.)
• The CEO has claimed no more equity dilution will occur in raising cash. Has the plan as related by the Board Member changed? If not, how is the CEO correct?
• The CEO has claimed no more equity dilution will occur in raising cash. How are the shares from the exercisable warrants to be considered as somehow “not dilutive?”

Full letter here.

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=117438535

Note the equity concerns, still on the table.

I don't just post here for fun, I took action to benefit shareholders. I think those efforts had a big effect. Trust Denner paid attention then and still does. BoD gone, Cantor gone, Pona price raised, compensation plan changed (somewhat). Denner stays plenty concerned still, especially since he recently spent $100,000 to try keep me quiet because I had turned my attention to him. It's going to take more than his efforts to date. Of course they hired more lawyers, too.

BTW, Denner shouldn't think that he's 'off the hook' quite yet. Other things are in play still. They take time to materialize, but they do.

Stay tuned.