AFFY has about $10 million Liquidity (maybe less) and Chap 11 Bankruptcy Appears Imminent
As per Affymax's Form 8K, filed March 18, 2013, it appears that there is about (and probably less than) $10 million in cash remaining net of current obligations. Let's do the math
$67M cash as of Feb 28,2013
Less $33M current liabilities and commitment to 3rd parties
Less $11M outstanding debt obligations under existing credit facility
Less $8M to $10M costs/expenses related to reduction in force
Net $15 to 13M cash as of Feb 28, 2013
Less $ unknown amount of expenses to continue Takeda collaboration and conduct
investigation and support the recall of Omontys
Less $ unknown amount to conduct ongoing business operations as a significantly smaller public
Looks to me that Chapter 11 is imminent and likely IMHO. As Affymax itself concludes:
In view of the Company’s limited resources and funds, it plans to explore various strategic alternatives, including a sale of the Company or its assets or a corporate merger. The Company is considering all possible alternatives, including further restructuring activities, wind-down of operations or even bankruptcy proceedings.
All of the pumpers on this board would have you believe AFFY is a buy at these prices, but nothing could be further from the truth. I post FACTS not HYPE.
A Chapter 11 would only occur if an agreement could not be struck with creditors. Chapter 11 would just reorganize the debt and buy the company time. In either event, the company will continue in a non-production mode pending the outcome of the inquiry. As long as the patent has value the company has value. It is the only asset other than some cash. Certainly, an acquisition of the company or its assets makes more sense.
In my opinion, this patent is valuable. I just don't know if this management has enough talent to have a good outcome given current circumstances.
moron you left out that 8k (which for lrgal purpases states worst case scenerios ) says potential fuure contract manufcturing obligations...now if they sell the company as the stated fiirst and appears what they a preparing to do..how much cash per share will they have?
It looks to me that you are either a psycho or an angry ex-employee who got fired. The $33M is a manufacturing contract obligation for future drug manufacturing. A savvy CFO should be able to negotiate a new term that is contingent upon the reintroduction of Omontys. The $11M debt obligation under existing credit facility is not due imminently and can be refinance with the bank (especially in today's credit environment). The $8 to $10M severence is an one time hit.
Affymax has turned over the investigation to Takeda, so Takeda will be incurring the cost of investigation and the cost of product reintroduction!!
So, the $67M should last a long long time, if Affymax management conserves.
You sure like bringing up stuff from 8K with your own twist. Here is an excerpt from Feb 13, 2013 8K that you probably missed and it is from Franklin W. Maddux, MD, FACP, Chief Medical Officer Executive VP For Clinical and Scientific Affairs from Fresenius Medical Care North America:
"We have accumulated experience in more than 56,600 administrations in over 18,000 unique patients. Two months into the FMCNA pilot program, the FDA released revised product information that added language similar to the prescribing information for EPOGEN® concerning the risk for allergic reactions, which we communicated to you in November 2012. To date, we have seen infrequent allergic reactions in our patient population receiving their first dose of OMONTYS®. Most of these reactions have been mild, but a small number have been serious. The rate of allergic reactions has been on the order of 1:1000 patients receiving a first dose of OMONTYS®. The vast majority of patients who are receiving the medication on an ongoing monthly basis are tolerating it well."
We have seen INFREQUENT ALLERGIC REACTIONS!!!!! This is from the Chief Medical Officer from Fresenius!!!!! And not some Godwinpeak talking head on Yahoo message boards!