Volgoat, Thanks for sharing the poison pill article. There are a few things that the article didn't address.
For example, the writer (Dan Caplinger) indicates how a takeover party might offer a small premium against the current share price "benefitting" current shareholders, that a poison pill might prevent. What wasn't discussed is how a reasonable premium can be figured if illegal naked shorting has suppressed the share price in the period leading into a bid or if a recent financing has depressed the pps while funds from the financing are progressing trials that are creating significant new shareholder value.
Dan mentioned how long investors would have missed out in the case of Microsoft if they had just accepted a large percentage premium compared to trading price rather than sticking with the company and reaping the benefits of far greater value released as Microsoft began to achieve its potential. For PPHM, an exclamation mark could be placed here, since PPHM has Bavi, 2C3 and Cotara proceding through trials and is anticipating phase 2 trial results "in upcoming months" (LOL!). Why would PPHM seriously consider a bid referencing current pricing if trials are going well? There certainly is incentive for a pharma interested in PPHM to take measures to suppress the pps while they make their overtures to PPHM management however.
Dan mentioned that a poison pill is very effective in preventing a hostile takeover. Bingo! In PPHM's case, where time is needed to progress trials and cash burn for trials keeps PPHM hungry for operational funding, the poison pill can help assure that a third party doesn't disenfranchize current investors from realizing the shareholder value that has been under development with the funds that long investors ultimately provided.
Dan mentions that the power given to management through a poison pill to interact with a potential buyer without being bypassed in an unfriendly way can bring benefits to management, employees or investors, with any bias reflecting the integrity of management for fulfilling their duties. Bingo again. Negative posters have been bashing PPHM management from various angles, including unsubstantiated (and operationally infeasible) allegations about management seeking to suppress pps for their own benefit. If indeed, there is serious buyout interest in PPHM as the Phase 2 trial results for Bavi, favorable resolution of CTL litigation is imminent and so forth, it might be fully expected that buyout parties and related stakeholders with questionable intentions would anonymously post on message boards to play with the uncertainty and related anxieties carried by long investors awaiting news and watching the pps be manipulated.
Perhaps, the illegal naked shorting evidenced when PPHM was on the Regulation SHO list at timing when pps was recently walked down from the low $0.70s combined with the regular, unsubstantiated PPHM management bashing are telling long investors hungry for news something? What if there are "fish" seriously nibbling on the PPHM technology bait but they are trying to work the bait off the hook before committing to taking a bite? If some or all the "bait" is effectively worked off the PPHM hook, it means that the unrealized shareholder value from Bavi, Cotara and TNT is at risk of being taken by third parties, not the current PPHM longs.
I am glad that PPHM has that poison pill in place. It tells potential buyers that they need to deal with management if they want the benefits of PPHM technology. I would rather trust in PPHM management to make the call in the best interests of my long investment than anonymous prospective buyers and parties taking license with anonymous posting on message boards. If indeed, the billions in unrealized shareholder value that PPHM longs are anticipating are soon going to be sorted as to who gets to participate in the end game when value is actually delivered and distributed, the current share price is providing opportunity for late comers to get in cheaper than most longs have been able to do over the last eight years. That is, at least while quantities of shares purchased are small and don't tip the trading balance or trigger disclosure requirements.
Very interesting times. Now if PPHM releases news ON SCHEDULE THIS TIME! in April and May, as per plan, uncertainty for long investors should reduce substantially and the opportunity for parties to play off uncertainty will diminish.
June brings timing when the conference presentations and related news will be past, a Duke paper should have been released (if it is going to be released at timing that matters for NASDAQ listing pps) plus PPHM needs to take measures that bolster pps to address NASDAQ listing concerns and restock accounts to support operational funding. It has been a long winter and I hope PPHM delivers a very nice spring to PPHM shareholders.
Best wishes and IMO.
KT
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