Replies to post #241256 on Innovation Pharmaceuticals Inc (IPIX)

[Echo20]

NickAudenNY


The Company signed a non-binding term sheet in August 2018 with a global pharmaceutical company for the licensing/rights to Brilacidin for treating oral mucositis and inflammatory bowel diseases. Initial payments, milestone payments and royalties are being negotiated in accordance with the non-binding term sheet. The pharmaceutical company is now engaged in further due diligence. Management can offer no assurances that the parties will enter into a binding definitive agreement.
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I hope they do not look on this board for info

Echo20

[Pipilongstocking]

Nick this is an interesting point.

" If partnership negotiations did not progress THEN management would release the information on BTD for the milestone payment.:

[loanranger]

"The commitment fee as other expense with the likelihood of not reaching any of the milestones by September 30th."

I've asked before and I'm asking again. Here's the commitment fee that they're talking about:
"Pursuant to the Securities Purchase Agreement, and in connection with Aspire Capital’s commitment to purchase additional securities from the Company, on June 28, 2018, the Company agreed to (i) sell to Aspire Capital 5,263,158 shares for a purchase price of $2.0 million and (ii) issue to Aspire Capital 2,736,842 shares of common stock and warrants to purchase 8,000,000 shares of common stock, with such warrants having an exercise price equal to $0.38 per share (the “Commitment Fee”). The total commitment fee of $2.7 million was allocated to the $2 million offering first based on historical price discounts that Aspire Capital has received and the balance of the commitment fee was allocated to the $5 million of potential future milestone funding from Aspire Capital. The portion of the commitment fee allocated to the $2 million of initial proceeds was approximately $0.5 million and was effectively netted against the $2 million of initial proceeds, resulting in a discounted purchase price at $0.29 per share. The remaining $2.2 million of the commitment fee was allocated to the future milestone funding and was fully expensed under Other Expenses, because it is unlikely that the Company will achieve any of the milestones by September 30, 2018 (see Note 13 to the accompanying financial statements)."

How was the $2.7M commitment fee calculated and what was the basis for its allocation? I wouldn't be surprised to see a note from the SEC asking the same question. The charge was both created and charged off in the same reporting period.
Obviously this issue is separate from the question of "How and when did they know about the likelihood of not reaching any of the milestones by September 30th?".

[loanranger]

"Therefore IPIX and CDA holders are keen to BTD and P results but Aspire is not."
I'm not sure where in NY you're from but I'm guessing that when they say "keen to" there they mean "aware of".

"Aspire would have to wait for the announcement just like we do. IPIX can withhold that information as long as necessary and as long it is not leaked by anyone in IPIX, a CDA holder or by any other breach."
If the BTD has been or is ever granted the date that happens will eventually become known. Just because IPIX CAN delay its announcement doesn't mean that there might not be legal repercussions resulting from doing so.
Consider the propriety of granting incentive shares and options to AB and JH while withholding that information from the public, for instance. (They did make those grants according to the 10-K even though the recipients haven't made any Form 4 filings).
The issue of the Company's obligation to report the receipt of a BTD is a tricky one given its inclusion in the financing agreement.

[loanranger]

"I also feel that the P announcement is moot because the agreement states that P would have to meet its primary end point. Essentially P already met it's primary end point so they could make an announcement and trigger the P milestone to pay the CRO and get the final results."

I'm not seeing the word "essentially" here:
"(n) “Successful Phase 2b” means that the Company’s Phase 2b trial of Prurisol on psoriasis has met its primary end point, which means a statistically significant increase (p<0.05) in the proportion of patients achieving at least a 75% reduction from baseline in PASI score (PASI75) while receiving Prurisol compared to those receiving placebo at the end of 12 weeks."

[TheDane]

Excellent analysis! It’s amazing so many “Longs” peed their pants as the first reaction to the 10-k. Sober and reasoned analysis, like yours and by others, from people who know the process will help keep the less Pharma-partnership-process informed from soiling more diapers and wrecking the stock.

Thanks!

[DesireToLearn]

Nick, maybe I misunderstood but P was not a Polymedix asset.