Replies to post #25097 on Avid Bioservices Inc (CDMO)

[djohn]

I don't think "That's it"


I think we will see more in the next two weeks. Don't know if it will get us over $1 for 10 days, but in my opinion this is just a start. PPHM has too much for someone not to put up some money.

[cjgaddy]

1967SJ, I assume you noticed that “that PR” to which you were referring was issued by DSM & Crucell and not PPHM/Avid.

[keep_trying]

Sofourner, you wrote: "That's it! That PR is supposed to bring us out of this incessant tailspin.".

I don't think a PR about an Avid agreement of this nature was expected by the market. At least, I didn't expect it. Being designated as a US source for the DSM/Crucell production is a good thing, which as Jazz notes, can fully subscribe Avid production capacity.

There were posts a few years ago about how if PPHM got Avid production fully subscribed under contract that Avid revenues could fund PPHM's trials without their needing to go to the financial markets for more private placements and such. We also know that Avid has the capability to expand. Wasn't it the poster GreenGrine who noted that he had been involved with the last Avid expansion and had figures about potential revenues per batch that can be generated?

What has not been said with this PR is how much revenue might be expected for Avid by being designated as the Western US supplier of "PER C6". Is production of PER C6 for customers already happening as part of the Crucell, Avid review process or is Avid production going to be linked with development of new PER C6 sales? How long will it take for Avid production to get subscribed to filling orders? How much of a cash advance does Avid/PPHM need to cover the production costs of PER C6 while awaiting payment for customers? What is the profit margin? Will Avid need to add those other two 1000 liter reactors that it has expansion prospects for in order to fulfill PER C6 demand and if so, where will that capital investment funding come from?

I think the above questions reflect good developments for Avid/PPHM and I am certainly not disappointed. It would have been nice if this sort of contract could have been established a few years ago, but it is certainly nice to see this happening now.

What about the Avid Halozyme production contract that Avid is currently filling? Will the July 7 earnings release show a boost in Halozyme production related revenue?

I just posted yesterday that I didn't expect to see PPHM release news this week and here we have what appears to be a very important Avid deal announced. What will PPHM be announcing through July 21 that can bring the pps above a buck?

If this PER C6 agreement is to significantly help the PPHM, pps recovery process, PPHM should assign a contract value estimate and timing for expected cash flows for this Avid deal. For now, investors don't even know for sure if there will be significant PER C6 related revenues in the 2008/2009 time frame, when it can make a difference in supporting ongoing trial plans. It would seem so, but something like a conference call characterization of what this means for PPHM in terms of revenue potential would be helpful.

Best wishes and IMO.
KT