Outlook Therapeutics Inc (OTLK)

[Mionaer1]

Unfortunately, not a word about the pink elephant in the room. The upcoming financing. I have enquired via Zoom but have not yet received a reply. I think they are in negotiations, as Thermo has indicated. I hope the dilution will be small. The PPS indicates a financing around $6.

[OGBritbox]

So strange they would need 180 days to review the one new trial data and CMC issues considering everything else was checked off

[H2R]

Today's Conf. Top Line data Q4/Resubmittal Q1 2025

* https://us02web.zoom.us/webinar/register/WN_HkXmgGkFQNaAx0JfHjtrmw#/registration

This was a two-part presentation, an overview with slides from Russ Trenary, then a Q&A session. The questions segment is the more interesting one. It starts around minute 24.

The mantra du jour was "maximizing shareholder value".

1. OTLK Overview

The slide deck is pretty much the one we've seen a few times now. The emphasis this time was on:

* FDA Track, Norse 8: Top line data in Q4; Resubmittal in Q1 2025
* 10 years market exclusivity in Europe
* 12 in the US.
* highlight the off-label Avastin repackaging process and why it's suboptimal
* Engaging with potential commercial partners in Europe

2. Main points from the Q&A session

*Roll out: it sounded like OTLK is going to roll out Germany and the UK earlier, and most likely by themselves, and potentially relying on a partner for other European countries. Russ would not say if any conversations were happening or with whom, but you could get a sense that the Company is engaged and looking at what a deal could look like, including profit-sharing arrangements, joint commercial/marketing activities, and pricing discussions.

* No IP: Russ said that for any biologic, the market exclusivity is based on the first Company to get approval for a molecule for an indication. Russ does not pretend to have a portfolio of patents, he does not need that.

* CRL CMC findings: the Company has established a working relationship with the FDA. During the type C and D meetings, OTLK went over each of the CMC findings and how they are/will address them. The FDA expressed agreement with OTLK on how to resolve the CMC findings. Russ seems confident about the resubmittal. He insisted on the "Complete" word in the CRL: the CRL is supposed to provide *all* the findings that need to be addressed. N8 is one aspect, the CMC is the other. OTLK does not expect to have to address anything else. Russ went over the SPA again.

* 180 day clock: A major amendment to a submittal (OTLK submitted and received the CRL) means a 180 clock upon resubmittal. Russ repeated top-line data in Q4 2024, and resubmittal in Q1 2025.

Russ has done that type of presentation many times. He seemed a bit on automatic to start with and got more enthusiastic with the Q&A session.

Nothing really new for me, except maybe the 180 day clock. Still vague on partnerships for my taste at this stage, but I get it.

Best of luck with your investments!

[H2R]

Active, not recruiting

https://clinicaltrials.gov/study/NCT06190093?term=norse%20eight&checkSpell=false&rank=1 finally reflects that the enrollment is officially complete.

Other changes:
Primary completion date: 2024-10
Study completion date: 2024-11

The change happened today, even if the update is date 9/11.

Best of luck with your investments!

[H2R]

Not yet. Work gets in the way :)
Cheers!

[OGBritbox]

Get a chance to listen?

[H2R]

3rd investor conference in September

Russ Trenary wants to the word to get out. The "Closing Bell Series" presentation will be his third. I'll be looking for new tidbits, but I think it's more to get the word out about approval, enrollment, plans, that we already are aware of. I'll be curious in particular about partnerships.

Best of luck with your investments!

[thermo]

If the original terms were "above market" then repricing the warrant would violate NASDAQ rules. However, since the company received shareholder approval for a below market deal, they may be able to make it a little more below market without S/H approval.

But I'm not 100% sure of my opinion. One needs to check with counsel.

[Mionaer1]

What a great buying opportunity. I bought on Friday and plan to buy tomorrow. OTLK virtually derisked IMO.

[HyperPhoenix1]

I.do not think warrant can be repriced without sharholder vote

[OGBritbox]

I also thought it would be highly irregular to sell the ATM at these levels. I just didn’t know what else it could be, so I appreciate the other possibilities !

[H2R]

Hi Thermo,

Would you elaborate on a scenario around European partners? There has been a change in tone and in slides around the European launch. Earlier in the year, Russ Trenary was highlighting the number of sales people in each country, the launch in Germany and the U.K. without much talk of partnerships.

This changed over the last couple of months. Even in today's recorded segment (Chardan, https://ir.outlooktherapeutics.com/news-releases/news-release-details/outlook-therapeuticsr-participates-2nd-annual-chardan-virtual ), again, talk about partnership in Europe, not in the U.S.

What could that look like and why would the PPS take a hit?

Many thanks! As usual, I look forward to your thoughts,

Best of luck with your investments!

[thermo]

I'm of the opinion that one of the investors in the March capital raise got nervous and rushed out the door.

Consider this:
- an investor holds 100 shares of common + a warrant exercisable for 150 shares.
- stock is trading $7.50
- the company offers to reduce the warrant strike to $6.50 for 1 week and the investor will receive 1 replacement warrant for each warrant exercised (the company will generally try to negotiate 1/2 warrant per warrant exercised, but it's negotiation, so it depends on leverage).

One trading strategy: sell 100 shares of common, exercise 100 warrant shares. The common held is unchanged (still 100 shrs), the warrant shares are unchanged, but one also has $100 extra cash. The major negative is the acquisition date was reset, so long term capital gains is pushed out into the future.

If one fund is worried the company will make the above offer, then a rush to the door ensues (sell before the other guy does), which is what this looked like to me.

I'm not saying the company made the above offer. They didn't make it to me, and they would. But investors forecast and this is a possible scenario. Other possible scenarios are an EU partner, or a royalty financing tied to EU sales, etc ...

I don't think it is sales off the ATM, since the company would be crazy to hit the market so hard.

[onebadz68]

Ah ok. Thanks for the explanation. Learn something new everyday. 

[OGBritbox]

OTLK has an outstanding at-the-market [ATM] agreement with BTIG that allows it to issue up to $100.0 million in stock to access capital. They’ve done so before, I believe in 2022, and I was only guessing that perhaps the reason for the increased volume and declining share price was the ATM.

[onebadz68]

Sorry newbie here. Explain ATM if you could? All I know is it's approaching RS price of $6.46. 

[OGBritbox]

ATM being sold is my opinion

[onebadz68]

What's with the price action the last two days?

[OGBritbox]

Looks like they may have sold some ATM yesterday.

[H2R]

September Corporate Presentation:

1. Enrollment complete confirmation



Slide 5: Indeed, enrollment is complete as of the first week of September.

Slide 20 puts a checkmark next to enrollment complete.

That's more like it!

2. No more launch map

In August, the launch map focused on Germany and the U.K.. The September presentation only talks about potential partners. I wonder if the 'potential partner' would have the ability to expand the launch regions substantially faster.

Best of luck with your investments!

[OGBritbox]

It just dropped

[Mionaer1]

I am pretty sure this was recorded before the Sept. 4th announcement. We’ll get the revised September company presentation soon.

[H2R]

Thinking a bit more about it, I'm wondering if this was recorded before the Sept. 4th announcement. Russ T. is not at the conference, only one question, from the M.C., nothing else.

Just a thought.

Best of luck with your investments!

[H2R]

Sept 9, 2024 investor's conf

H.C. Wainwright 26th Annual Global Investment Conference - September 9-11, 2024
https://journey.ct.events/view/58e0675c-73a3-47d6-8ff8-03ab41bb5581

1. Enrollment complete?
The usual spill, very much based on the Aug 2024 corporate presentation. However, one thing bothers me. I did not hear from Russ T. that the enrollment was complete. On the contrary, it sounded like it would be complete in Q3. This seems to contradict:
* https://ir.outlooktherapeutics.com/news-releases/news-release-details/outlook-therapeuticsr-announces-completion-enrollment-norse

Russ T. may not have updated some of the slides from Aug. :


and



Neither says 'enrollment complete' .

2. European Partnership

Russ T. says that OTLK can be launching in Europe by themselves or with commercial partners and that is still not decided. It's a bit more vague than I would like, which may be by design. It sounds like the cost of launch could be one of the main factors, as opposed to the reach, the market access, and other criteria which could help accelerate OTLK's ramp up. We are only a few months from 2025, again, I would have expected this side to be ironed out.

All in all, the same premise as the typical presentation, with a slight negative on those two points.

I'm still very bullish.

Best of luck with your investments!

[Monksdream]

OTLK under $10

[H2R]

European Partner Deal Getting Close?

A paragraph in the enrollment completion PR mentioned a European (and potentially other regions outside the US) for commercial purposes:

If approved by the FDA, Outlook Therapeutics plans to commercialize ONS-5010/LYTENAVA™ (bevacizumab-vikg) directly in the U.S. and is also assessing partnering options for LYTENAVA™ (bevacizumab gamma) in Europe and other regions outside of the U.S.

I had seen a reference to a potential partner in the August corporate presentation:
https://ir.outlooktherapeutics.com/static-files/d9b068b8-621b-404f-ac70-d63ae51c0c53 , slide 25

Engaging with Potential Licensing Partners for Commercial Launch in the EU and UK

I would expect language around commercial partners after any deal is done, not before. That leads me to wonder if a deal is far along and details are being negotiated. Should we expect another PR this month, this time around commercial partnership?

Best of luck with your investments!

[H2R]

NORSE EIGHT Topline results expected in Q4 24!

https://ir.outlooktherapeutics.com/news-releases/news-release-details/outlook-therapeuticsr-announces-completion-enrollment-norse

This is excellent news. As usual, they plan, they execute.
Best of luck with your investments!

[H2R]

Thanks OGBritbox Excellent!!! Norse 8 enrollment completion PR here

https://ir.outlooktherapeutics.com/news-releases/news-release-details/outlook-therapeuticsr-announces-completion-enrollment-norse

ISELIN, N.J., Sept. 04, 2024 (GLOBE NEWSWIRE) -- Outlook Therapeutics, Inc. (Nasdaq: OTLK), a biopharmaceutical company that achieved regulatory approval in the European Union and the United Kingdom earlier this year for the first authorized use of an ophthalmic formulation of bevacizumab for the treatment of wet age-related macular degeneration (wet AMD), today announced the completion of enrollment for its NORSE EIGHT clinical trial evaluating ONS-5010 in wet AMD patients. NORSE EIGHT is the subject of a Special Protocol Assessment (SPA) agreement with the FDA, and, if successful, is the final anticipated clinical trial required before expected resubmission of the Outlook Therapeutics’ Biologics License Application (BLA) for ONS-5010.

NORSE EIGHT is a randomized, controlled, parallel-group, masked, non-inferiority study of newly diagnosed, wet AMD subjects randomized in a 1:1 ratio to receive 1.25 mg ONS-5010 or 0.5 mg ranibizumab intravitreal injections. Subjects will receive injections at Day 0 (randomization), Week 4, and Week 8 visits. The primary endpoint is mean change in best corrected visual acuity (BCVA) from baseline to week 8. Outlook Therapeutics remains on track to report NORSE EIGHT topline results in Q4 CY2024. The resubmission of the ONS-5010 BLA is planned for Q1 CY2025.

“We are very pleased to complete this important milestone in our effort to resubmit our BLA for ONS-5010. On behalf of Outlook Therapeutics, I would like to express gratitude to the patients and dedicated teams at the clinical sites, as well as our clinical and regulatory staff, who enrolled this entire patient population in less than 8 months after our SPA agreement from FDA,” commented Russell Trenary, President and Chief Executive Officer of Outlook Therapeutics. “We remain confident in the potential of ONS-5010, if approved, to meet the needs of retina specialists, patients, and payers. With enrollment now complete, we plan to report topline efficacy results in the fourth calendar quarter of this year.”

As previously announced, following Type A meetings with the FDA in Q4 CY2023 to address the ONS-5010 Complete Response Letter (CRL), the FDA informed Outlook Therapeutics that it could conduct a non-inferiority study evaluating ONS-5010 versus ranibizumab in a 12 week study of treatment naïve patients with a primary efficacy endpoint at 8 weeks (NORSE EIGHT) to support the resubmission of the ONS-5010 BLA. In January 2024, Outlook Therapeutics received written agreement on the NORSE EIGHT trial protocol and statistical analysis plan from the FDA under the SPA. The SPA also confirms in writing that if the NORSE EIGHT trial is successful, it would satisfy the FDA’s requirement for a second adequate and well-controlled clinical trial to fully address the clinical deficiency identified in the CRL. In addition, Outlook Therapeutics has completed Type C and Type D meetings with the FDA to address the open chemical, manufacturing and control (CMC) items in the CRL and expects to resolve these comments prior to the expected completion of NORSE EIGHT.

Best of luck with your investments!

[OGBritbox]

Enrollment now completed

[H2R]

OTLK at H.C. Wainwright 26th Investment Conference

Russell Trenary, President and CEO of Outlook Therapeutics will present at the H.C. Wainwright 26th Annual Global Investment Conference being held September 9-11, 2024 in New York, NY.

https://ir.outlooktherapeutics.com/news-releases/news-release-details/outlook-therapeuticsr-present-hc-wainwright-26th-annual-global

Norse 8 enrollment numbers may be updated for that conference, given how close it should be to completion, if not completed. The Corporate presentation may also be updated. And hopefully, the video presentation will be easy to access.

Best of luck with your investments!

[Mionaer1]

Thanks Thermo. Very interesting. Always appreciate your posts.

[thermo]

I described by Plan C to management. But they told me they didn't need to consider it because they had things under control.

My Plan C:
a. For a one-week period, reduce the strike price on 20% of the warrants from $7.70 => $6.00 [may have to be a bit lower, but the holders are polled first to know]
b. Sell off the ATM at 5% of daily volume until data in hand [this won't impact the stock price much]

This is combination is the least dilutive approach -- no new warrants are issued. As a holder of some of the warrants, I would exercise early for that inducement.

I'm still not 100% convinced they don't need a Plan C but, as I said, they believe they have it under control.

[H2R]

This month: Norse 8 enrollment completion expected.

This month, we should have news that the enrollment is complete. From the August 14th CC, https://seekingalpha.com/article/4714514-outlook-therapeutics-inc-otlk-q3-2024-earnings-call-transcript:

NORSE EIGHT is progressing as planned, and we currently have 359, that's 359 of the planned 400 subjects enrolled. We continue to expect a complete enrollment before the end of the third quarter. Top line results from NORSE EIGHT are expected in the fourth quarter of this year and if positive should provide sufficient clinical data to resubmit our BLA with the US FDA in the first calendar quarter 2025. In addition, we've completed our planned Type C and Type D meetings with the FDA and believe we have addressed the open CMC items that were received in the CRL.

we believe that right now [Note; August 14th] we've got enough in screening to take us to 380 patients. On top of, and of course today or yesterday we were at 359, so we continue to see a good level of screening and expect that to continue so that we can comfortably finish enrollment before the end of the third quarter.

Best of luck with your investments!

[Mionaer1]

Plan C. Shouldn’t this be a smaller capital raise if catalysts like FDA filing and first EU sales are coming up in the first half 2025. Assuming of course that Norse 8 is successful. Maybe 5M shares including 5M warrants?

What surprises me is that Russ Trenary was actually very confident at both the quarterly CC and the HC Wainwright event that OTLK would be fully funded by the end of 2025.

[thermo]

Replies:

1. If there is a financing, is it safe to say it would be after results?
Here's what I know (or believe):
a. Active discussions for an EU partnership ongoing. Hard to gauge timing but should take care of the financing issue.
b. If "a" doesn't close soon, they need a Plan B. Some financiers in the March 2024 round are considering early exercise of warrants (w/o the need for the price to exceed $20. As I said earlier, normally the ask would be some extra economics, but that doesn't seem to be the case). They would prefer to see the data first but may have to make a decision w/o. Company cash lasts into 1Q'25, so they're cutting it close.
c. Plan C. This is the one I worry about. If "a" doesn't happen and the warrant holders don't follow through on "b", then we would see a dilutive deal. But the warrant holders don't help themselves by head faking their intentions. So, right now, I think we'll see "a" or "b".

Sorry, I wish I could describe it more simply, but I wanted to express the nuance.

2. I assume this has been expensed to R&D so will juice the GM and bottom line a bit. More importantly, cash flow. Is it enough to be material?
I haven't asked and I haven't tried to determine it from the Q. Of note, inventory stocking following launch should juice early numbers.

[exwannabe]

Thermo, a couple questions.

If there is a financing, is it safe to say it would be after results?

Also, they mentioned product already on hand for launch. I assume this has been expensed to R&D so will juice the GM and bottom line a bit. More importantly, cash flow. Is it enough to be material?

TIA

[StonkMaster]

I miss your input over on the NWBO board, especially now when things are just getting exciting (finally). You're right though, it's a cesspool of garbage. Either way, hope you're well and pop back in from time to time!

[thermo]

A word to all longs...

From what I read, some on this board think OTLK is a great investment, some think it's really great, and some think its f*cking great.

Until we get to $40+, these opinions are all the same. So, let's keep this board pleasant.

As many of you know, I used to visit the NWBO board, but I just got so tired of wading through garbage over there. I have a sizable position in NWBO but I concluded that the board was a waste. Let's keep this one worth visiting.

A word to all shorts...
I welcome skeptical opinions too -- investors who care about performance want to be challenged -- as long as they are honestly expressed.

[OGBritbox]

I would guess that with European sales beginning soon that would alleviate much of the financing concerns

[OGBritbox]

By the way, my price prediction included FDA approval and sales in US! Also your math and overall comprehension is terrible, but ok go ahead and sell at $10 then buddy

[thermo]

What makes OTLK special is how much we can predict.

- Norse 8 very likely to succeed
- OTLK will get a meaningful share of the US and EU market. Laws in both regions compel this and legal liability and the need for health care cost control will drive this outcome.
- Any reasonable assumption on price per inject ($200 - $500) yields significant revenue.
- Any reasonable revenue multiple yields a much higher stock ($40 - $400)

The risk is financing, which can be solved by those holding a significant share of the equity.

[Mionaer1]

I like your optimism. But we don't even have the results of Norse 8 yet, let alone FDA approval. Furthermore, a price of $500 per injection in Europe is completely unrealistic. Take a look at the European prices of the competitors in the OTLK presentation. A maximum of $300 in Europe is realistic.
My best case scenario: 67% of off label Bavi injections (6.3m x 0.67 = 4.22m) at $400 (USA: $500, Europe: $300) per injections results in annual sales of $1.7B.

OTLK is a one trick pony therefore a multiple of 3. So a MC of $5.1B, means a PPS of $127.5 with O/S of 40M.
Hopefully no major capital increase will be necessary in 1Q 2025, as indicated by Thermo.

[OGBritbox]

Literally what they expect to see in profit after their first year of sales in Europe and US lol. Only someone stupid would sell the company for so little when it’s worth so much more

[thermo]

"I wouldn’t call that a good investment"

okay, okay...a pretty good investment

[Mionaer1]

If all goes well, we will see a BO at $4B IMO.

[OGBritbox]

If you’re correct, let’s be conservative and cut my estimates in half, we’re still looking at $400 a share or $20 pre-split. For most a retail that is a 2000% upside! I wouldn’t call that a good investment. I’d call that the investment of your life!

[thermo]

I think the ASP on Europe should be lower (plus OPEX will be higher due to fragmentation) but the big picture is clear: get over the financing issue and it should be a good investment.

[OGBritbox]

Here’s my breakdown WITH all warrants being exercised. Prove me wrong
US - 1.75MM patients
EU - 1.52MM patients
Call it 3MM (not 3.27MM). If OTLK gets 25% of those, that's 750,000 patients/ year.
With 12 injections/year (1 per month), that's 9MM injections.
9MM injections at $500/dose is $4,500,000,000 in revenue.
If you have 75% profit margins, that's $3.375 Billion profit in the first year.
A 10:1 P/E makes us a $33.75
Billion market cap.
Figure 40MM shares outstanding (all warrants and stock options exercised plus a few extra issued in the shelf
ATM). That's $843.75/share. Within the first year after FDA approval, with only 25% of the US & EU markets (not including Japan, Australia, Asia, Africa, and South America), your share price is over $800. Bullish

[thermo]

They're still running a process for a UK partnership, in my view. A solid deal with upfront cash will alleviate the current significant risk of running out of cash in 1Q'2025.

If they don't sign a European partner in the next month or two, we may see the warrant holders exercising early (before the $20 stock trading threshold is met). That's not purely rationale (e.g. as a holder of stock, as long as I participate in a dilutive deal at my pro-rata, I'm usually okay with it). But, fortunately for the average holder of the stock, there seems to be a desire to avoid another deal with warrants (and another deal at all). This would leave the very significant return upside intact.

[exwannabe]

I am very curious to see who the licensee for Europe will be.

Per Thermo, OTLK has not said they plan to license the EU/UK markets. But he strongly believes they will do so.

That makes sense to me. Those markets are all about understanding the dynamics of the individual state payer systems. It is well worth it to let somebody who knows the business get a cut of the deal in order to avoid a failed launch.

I have better hopes for the EU/UK now than previously. Still do not see it as the US, but not something to be ignored either. My opinion change came from the review of the UK NICE decision on the space. I know it is state by state, but still ...