Replies to post #347735 on Innovation Pharmaceuticals Inc (IPIX)

[Longpicker]

Totally agree. Leo is in the drivers seat and the shorts (and people who do not own shares yet) are going to be mud wrestling for shares real soon. Excellent post!!!

[falcon74]

Water with Lemon...... excellent well written thoughtful post!

My biggest concern regarding Brilacidin over the past year has not been whether or not it will be successful, but, being a potential Major Disrupter in the BP industry there are probably several BP companies that want to bury Brilacidin in order to protect their own pipelines.

I believe this is the reason why this company has been attacked so hard for the last several years by a criminal cabal that has been probably funded by a BP or BP's. Hopefully, we can find at least one BP that will want to bring this drug to market to cure people and make money doing it.

[Lemoncat]

A year ago, before COVID, we had $7M in liabilities and about $700K in cash with a stock price around $0.08.

A buyout seems foolish when success is assured. If the COVID trial fails and we are back in the position we were in a year ago, all of a sudden that $5 buyout starts looking really good.

You have to keep in mind this is a company that spent 2015 to 2020 with a stock price that closed at new lows for the company year after year after year.

Yes, if B-COVID succeeds and gets EUA and billions in revenue then things look quite bright. If a company came along and offered a few billion prior to unveiling the results, would Leo take it? What if it fails?

The buyout represents an assured win. What if you spend years developing the other indications and they fail as most drugs do? What if the company never reaches the buyout price or worse folds after another agonizing 5-10 years?

But enough about the buyout. Leo has stated his intent was to become a royalty-based company. It was also his original intent to develop Kevetrin. Perhaps if a company came offering $5B for Brilacidin he'd take it and continue developing Kevetrin full steam ahead.

Tough to tell.

Go IPIX!

[insearchof]

Excellent post!
$IPIX

[microchips]

Interesting Post to chew on Water withLemon. However, I am an old chem E who does not and has not ever worked for a BP. In fact I've been quite critical of them to friends and family because of the hold they have on the industry. Too bad about the hot women though. I suppose that they will find other jobs. LoL

[Eirrol]

Wow! So well written and thought provoking. Thank you.

[Rdunn88]

Leo is selling IPIX, all clues point that direction. Besides age, there’s been zero employee additions in 2020 including a replacement for second in charge Dr B. Most of the press releases the past year are CV-19. No replacement for the third board of director who has been gone a long time. No shareholder meetings, no corporate updates providing a financial outlook. 4 employees is a freggen joke... it’s CV19 results and what can Leo get for the assets.

[Tyrus603]

Your supposition that Leo will not want to step aside for a huge payday and let a big pharmaceutical company commercialize Brilacidin may be true but never having met him or even heard him talk I don't know his motivation. What I do know he is that he is 62 and probably on the cusp of retirement, so when I read this 2019 article, "3 Signs That Your Biotech Is About To Be Acquired," posted on the website, sickeconomics.com,
I thought it described Innovation to a "T" and checked all the boxes for the current situation Leo and his tiny staff at IPIX find themselves in:


Key excerpt from article:

"Today’s M&A landscape exists largely because it allows different kinds of people to form different kinds or organizations that  excel at certain niche tasks. There are few organizations on earth with as much financial and political muscle as a major Big Pharma concern. But these corporate giants are often poor at scientific innovation for cultural reasons.  Young upstart biotechs, often founded by starry eyed scientists looking to change the world, can be shockingly inventive in the science lab. But they simply don’t have the mental or financial resources to navigate the treacherous jungle of red tape that stands between medical breakthroughs and patients. Thus, M&A.
There are a few tell tale signs you can look for if you want to mine for M&A gold in this vein. First, look for biotechs with agents that have already passed through stage one and stage two studies. These studies are typically just designed to prove the basic viability of a concept. But they can still cost mountains of cash to complete.
When you hear about a smallish company that has attained promising phase 2, or even phase 3 results on a new molecule, immediately go to Etrade and find out how much cash they have left on their books. This can be found by quickly checking the company’s balance sheet and cash flow. If you are semi literate in accounting, the question is, “How much cash per quarter is this company burning?”  For example, if they are burning approximately $25 million per quarter, they have a good stage two data, but only $75 million left in the bank, then you know that something needs to happen. Companies with hard won good data don’t want new agents to wind up in the garbage can just because they ran out of cash at the wrong moment. If you are not accounting literate, do as much reading on the company as possible, or check an analyst’s report. “Cash Burn” is a common metric, and most analysts will point out how long a company can operate without some kind of capital raise.
Big Pharma execs really like to minimize risk. That is typically why they have built careers with big, established companies. By allowing scrappy bands of scientists to do the most risky lab work on their own, they are able to swoop in when the scientific risk is more or less controlled. Big Pharma eats red tape for breakfast. When the science is proven, playtime is over and the “adults” are ready to take over.  If you are lucky enough, or smart enough, to time your biotech investments just right, you can reap the rewards of these transactions.
 
 3) Your Controlling Shareholder is at the End of Her Career. Or the Beginning of Her Career.
The funny thing about the world of biotech is that companies can be valued at a $ 1 Billion or more without selling a single product. All of the value is in the assets that the company has developed, which will theoretically lead to boku bucks one day. Theoretically.
So you can understand why a 67 year old scientist founder might be tempted to take a giant payout from Big Pharma and move to Boca Raton.  Let’s consider the math. It’s not unusual for a biotech with a promising phase two product and good data to be valued as high as $500,000,000.  Now, at this point the founding team has probably been laboring in obscurity for years, and they likely have taken on investors to fund their expensive biotech dreams. Its rare for a founder to retain majority control throughout the product development process because it’s just so expensive. However, the founder, or founding group, could retain 5 or even 10% of the company’s shares. That may well make him or her the largest, most influential shareholder. So, if Pfizer offers to buy that company for $500,000,000, some ageing nerd with a PhD may well be walking away with $50,000,000. That is. A. Lot. Of. Money."

[LilyGDog]

100% great post!

Go Leo & IPIX!

My sense is that all these "Buyout!", "Buyout!" posts are by Big Pharma stooges. No one in their right mind would even think of selling what Brilacidin alone has to offer much less Kevetrin at this point. Your post was one of several I have seen implying Leo is old and needs to retire and so I suppose you think someone would be "doing him a favor" to buy the company out and let Leo go play in the sand and paint old people pictures or engage in some idealized retiree paradigm of worthless behavior as long as Leo "gets out of the way".

You spend decades trying to bring a great medicine to market and you get it to the point that all you have to do is manufacture it and sell it ..and then you sell the whole platform off? Why? You outsource the manufacturing ( don't have to keep up a factory or the insurance on the factory, or deal with labor or unions, etc.. ) , you outsource the advertising and the marketing and there you go. That is in fact a very good business model as opposed to keeping up multiple properties. In the trucking industry as one example, Landstar owns no trucks or trailers, leases trailers that they never own, has no maintenance facilities, and has over 10,000 owner operators maintain their own trucks to move freight that independent agents find. A very lightweight business model that rakes in the bucks. Thinking that in order to be a "proper" pharma or business at all one must have lots of real estate, equipment, lots of employees and a huge overhead/expenses is so last century if you haven't noticed. I'll take Leo with so-called 'four guys in an office' or whatever it is now over massive upkeep for lots of real estate, manufacturing, transportation and having to recruit hot looking, perfectly made up blonds, brunettes and red heads to go to doctors offices and give out free samples and make sales based on their looks and charm rather than the efficacy of the drugs.

My sense as well is that if Big Pharma wanted to buy it, they would buy it to bury it as they have whole platforms of drugs that Brilacidin seems poised to displace in the marketplace; whole budgets of advertising and lobbying and such that would be wasted should Brilacidin hit the market. I have read somewhere that there hasn't been a new class/type of anti-Biotic to hit the market since the 80's. This article is just one of many stating the stark situation and places the last new drugs since 2000:

https://projects.iq.harvard.edu/sciencepolicy/blog/less-same-rebooting-antibiotic-pipeline

excerpt

"Every drug that enters the market costs several billion dollars, from research and development through testing. When antibiotic development proved to be the arms race described above, some of the biggest pharmaceutical firms – such as Pfizer, Roche, and Bristol-Myers – dropped like flies from antibiotic research.

The few companies that continued developing antibiotics on mostly focused on this so-called “analog discovery” – modifying the chemical structure of existing drugs just enough to bypass known resistance mechanisms, as with the beta-lactams. From a business perspective, this is safe: side effects and targets have already been classified, and approval processes will be faster. From an arms race perspective, however, this fuels antibiotic resistance by repeatedly introducing modified, but similar enough, drugs."

...Only 15 new antibiotics have been approved since 2000, compared to the 63 put to clinical use between 1980 and 2000 (Figure 1). Out of these 14 new drugs, only 4 of them represent new classes of antibiotics, targeting bacteria through novel mechanisms. Linezolid, for instance, is the first “oxazolidinone,” and it entered the market in 2000. Oxazolidinones are considered last-resort drugs to be used only when every other existing antimicrobial therapy has failed. Still, bacteria resistant to each of these new drugs have already been isolated."

from GOODRx:https://www.goodrx.com/linezolid

"LINEZOLID is an oxazolidinone antibiotic. It is used to treat certain kinds of bacterial infections. It will not work for colds, flu, or other viral infections."


So on the cusp of giving the world, the very real possibility of being the new penicillin as a revolution in medicine, an anti-biotic already proven to kill MRSA, already proven to have great benefits for the whole body, and very possibly to deliver the world from a pestilence, you guys keep wanting Leo to sell. I find that bizarre. Like Wow! bizarre. The sales contracts and the financing will come when the proof is there after this phase 2.

Not to put to fine a point on it, but America needs more leaders like Leo who have stood the test of ceos-of-their-armchairs running him down. You would do yourself a favor to read Teddy Roosevelt's "Citizenship in the Republic" , which Leo, by the grace of God, has exemplified.

an except:

"It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat."

As far as money, Leo has it made no matter what happens. Why would he continue unless he genuinely had a vision to save lives that he felt no one else could accomplish? William DeGrado is the same. They both could have retired a decade ago.

message in reply to:


"My sense is that Leo is positioning for a buy-out. If he was 35 years old with a starter drug like Brilacidin I could see him building this into a major company, but the best way to make money in the next couple of years is a buyout. If investors want to stick around for everything else you keep your shares in whatever big pharma scoops this company up."

God bless all

[keltoi]

Well said.Kudos.

Kelt

[capital gain]

Great post, fully agree with the points you raise, unfortunately this is the world we are living in, corruption is going through the roof all over the place, not just in the pharmaceutical world.

Looking through the history, that is normally the end stage before an empire collapses, in this case the western world AIMO.

Leo has been very smart with his move to do some of the clinical trial in Russia, I hope that move is what will secure IPIXs success.