Replies to post #59149 on Avid Bioservices Inc (CDMO)

[jakedogman1]

As I said earlier, this has been a game of transferring ownership from shareholders to mgmt. In most all other cases, the mgmt starts off with owning the company and slowly dilutes it as capital is raised and at the end of the day, mgmt still owns a significant amount or they have gotten rich selling along the way. In pphm's case, mgmt owned virtually nothing (when sk and crew took over a faltering company) and found the shareholders have some very valuable assets (bavi and other mabs) of which mgmt owned nothing. So mgmt has slow played progress in share price and actually crushed it on several occasions and granted themselves significant ownership stakes via options. And they have entrenched themselves with a team that has zero biotech experience but allows them to continue transferring ownership.

The failure to get the going concern issue is exhibit A. Removing that hurdle would have allowed many institutions to jump in but that would have caused the share price to go up which hurts mgmt.

Right now mgmt is in the process of giving themselves 8.5 mil shares or 13% more of the company. Every dollar increase in share price costs mgmt $8.5 mil. So a $4 swing costs mgmt $34 mil. Divide that amongst the chosen few and you can see why the games are played. In the meantime they are content to sell shares for pennies on the dollar to keep the lights on. But it is not their money and they have 250 mil more shares to play with.

I'm just hoping that once dartman gets his fill, he puts a new team in place. Love to see the slimeballs get booted at the goal line.

[Thurly]

Of course mgmt does not care because they are not the ones being diluted. It amazes me that this has gone on another two years! Heads should be rolling!

How do you know that they haven't maximized the financial benefit of AVID despite its not being profitable? And isn't that their current strategy as stated in the last several CCs? Wouldn't you prefer them to look at their businesses as part of a whole with an overarching corporate strategy? If the strategy has changed since 2008, why do you assume that it has changed for the worse? A lot has happened -- a lot changed -- since that CC in 2008.

This stock is what it is at any given moment -- and at this moment, it's hugely speculative. IMO, you're most likely looking at dilution for the next four years.

There are catalysts that could change that: A Cotara partnership (or anticipation of a partnership) after a successful PII could help us by 2013. Partnering Bavi ROW after successful PIIs could help. The animal studies in anti-viral could help in a couple of years. Additional government contracts are possible. A buyout is possible... But, not counting chickens, dilution until 2015.

We have a lot of science we're trying to advance clinically with very little money. We have nothing in PIII.

The entire management and corporate strategy has changed since Garnick & Co. came on board. Why would you want to hamstring the company with a old 2008 strategy when, since 2009, they've gotten more experienced management in place and obviously improved their strategic plan?

I hope they always have the flexibility to go with their best strategy at any particular point in time if it maximizes my long-term return.