Replies to post #12929 on GTC Biotherapeutics (fka GTCB)

[biopearl]

Dew, Thank you for this analysis. While not too attractive it beats bankruptcy and preserves some value of the stock for existing shareholders. My initial impression of a reasonable marriage between these two looks a little more like a Hollywood prenup than a marriage of equals. Its a shame since GTCBs IP seems by far and away more valuable than Pharmings. I guess we continue to hope the Red Sea parts and a partner for CD 137 emerges, Dr. Ready wants to make FOBs in goats, Bill Gates makes good on his commitment for a malaria vaccine, goats cure Alzeimers, or an existing partner extends a line of credit. Maybe all at once! Again thanks for answering my questions. Regards, bp

[alertmeipp]

>Pharming had $78M of unrestricted cash, $16M of restricted cash, $110M of convertible debt, and $10M of other liabilities.

Net net, Pharming has -ve cash balance, i.e. Pharming is in worse shape than GTCB.

[alertmeipp]

I bet merging with Pharming will not help the share price. Indeed, it will probably crush both. As noted by Dew, Pharming has negative cash balance (i.e worse than GTCB). Plus Pharming's pipeline is not as robust.

And its convertible debt will create pressure on the share price as well.

A buyout would be nice, a partnership would be nice. But merge with a somewhat inferior company will suck.

[alertmeipp]

> obviate the need for financing transactions during the next two years

Dew, I just don't see that, each company is going to spend close to 25-30millions per year. Looks to me the merged company will need to access the capital market by the end of 2009 if they want to have one year cash buffer.