Just trying my best to poke holes in the poly story and having trouble doing it. The data looks so good. Does anyone know of there's been info posted on what the cost to manufacture 63 will be relative to other antibiotics? Or someone with a chemist BG know how simple it is to synthesize such small proteins? I can't find any reasons why it's not a buy at these leeks other than ignorance and fear. Even with lots of dilution this baby looks like a huge winner come 2015 which I am willing to wait for and I'm looking for anyone to help me see if / how I am wrong. No one seemed to bite at my last topic asking how this would not be a winner even with dilution. Just want to get some actual
Fact based discussion going rather than all the bs and negativity. Anyone? Bueller? Brock? ; )
Pharma margins are huge - but getting a drug to market require overcoming nearly insurmountable odds and requires loads of cash. The hole is that PYMX is in a tough spot now: how can it raise money at today's valuation - with a 60 million makt. cap the Company would have sell a 1/3 of itself to raise $20 million, while a lucrative deal with a pharma company is going to be dicey as well - why pay big dollars for a company whose total value is $60.0m. Who cares about the margins on the finish line if you can't get there. Now tell me - why do you say that the data "looks so good" - everybody is repeating what the company has said, but the fact is that when data came out the stock dropped over 60.0%. Rule of thumb is that good data gets rewarded bad data gets you punished...
The data isn't bad, just the data presentation (and presenters). Nic was a scientist first (for a whole year) before he got into business. See his linkedin profile here http://www.linkedin.com/pub/nick-landekic/5/119/aab. He hasn't lost that mindset.
In later jobs, he was in pharmaceutical product planning and business development. There, he likely dealt with people who understand the subtle nuances of science-speak. Now, as CEO, he should be promoting his company to a broader audience but I don't think he understands how to "dumb down" his presentations to reach the general investing public.
I have my doubts he'll ever learn to, either.
bry, maybe you need to be a scientist to understand why. Perhaps that was managements fault for not making it clearer to lay people. Maybe the fact that you are seeing the data as not good is exactly why the stock price has gone down. People are perceiving it as bad who don't understand science and statistics. Perhaps since this is being traded by non-institutional investors, they don't have access to real scientist investors who know what they are doing. One big investor panicked when the stock price didn't skyrocket, and then everyone else did in a very thinly traded otb stock. Thats why the stock is now a buying opportunity. Not because the data is actually bad.
Ok tell me this... Even assuming more dilution which everyone is crying about. How much more dilution do we really need to fund until 2015? Two more dilutions? Three? So even if that scenario played out and the drug was a success, wouldn't this still be a home run from these levels? Not being a financial guy, i'm not quite sure how to fully determine that but maybe some of you guys can help?
First this is by no means exact, but more back of the envelope to help answer your question..
So if you assume for 2013 -2015 the company spends:
8 million per year SG&A
5 million per year on R&D efforts
5 million per year for early stage trials
They would need $54 million to get through 2015.
Now add to that the cost of 63 phase 3 if going it alone, call it $50 million.
This would mean the company would need to come up with funding of something on the order of $104 million.
I'm excluding warrants to keep this simple and more conservative, if there are 110 million shares outsanding which get reverse split at 6 for 1 the stock price would increase to roughly 3.40 and reduce the outstanding shares to roughly 18 million shares.
If the company prices a secondary at say 3.50 they would need to issue an additional roughly 30 million shares to get the $104 million which would put the outstanding count at roughly 50 million.
If 63 is able to generate revenue of say 800 million a year (pretty similar to dapto), and the company sells at a 2x sales multiple it would value the company at roughly $1.6 billion (or roughly $6.40 a share) or an upside of about $3 per share post RS (roughly $0.50 pre RS). Put in a risk fact or and we're probably about $0.20 below fair value in my opinion so I think your right (not even taking 56 into consideration at all)..
So yes I think from here there is good upside (but also a lot of risks/unknowns), but I still like the company and have added a little to my position on this weakness. I'm now long 18k shares at an average of just over $0.70
You're looking in the wrong place for the hole in the PYMX story.
The science is excellent, all the technical and production aspects are fine.
The hole is the financial and management team. It's like Dilbert - smart techies working for pointy-haired morons.
Nic is a hole.
Something I looked into about two years ago and was convinced the production cost would not be a problem, nor would the manufacturing. Unfortunately, I seem to have forgotten the whys and wherefores so this response isn't much help!
Small molecules like PYMX has are cheap to produce compared to proteins/peptides, MABs, enzymes, etc.
Nic has buggered things up lately, but the science is as promising as ever. Hopefully the recent R/S debacle will produce a change in Nic toward partnering. That's the way to turn this ship around -- get big pharmas advancing PYMX's programs on multiple fronts.
Look at the partnering possibilities -
- Heptagonist - anticoagulant reversal
- Oral Mucositis (keep in-house)
- Blood Stream Infections, Bacteremia, Endocarditis
- Lung Infections, Pneumonia
- Gram Negative Infections
Hey E. The only holes I see is the dilution factor which is and has always been a concern of current and older shareholders like myself. I have been diluted twice in the four or five years I have owned the stock. We have not had any bad test results to date (Knock on wood). The antibiotic is cheap to make. I think it takes three steps. That is just one of the great benefits besides, little chance of bacteria resistance, one to three doses, fast acting, anti-inflamitory, and few side effects. Brock
I feel so diluted I don't know which hole to cover when I sneeze, cough or hiccup.
This is becoming a nighmare and nothing but sellers after sellers out there picking away at the even lower PPS. Where are Ironman, MG and others I haven't read much from of late. I would have entered Brock, but he just said something.
My point is a larger corporation would not need to worry about dilution. They have the muscle to do it if they have control so, at this price or even !.50, why not take it if everything is as positive a it looks to me. Just wondering. Admittedly, I usually invest in other types of businesses, but was drawn to the amazing LOOKING future for this company. But to quote Soros "I MAKE MISTAKES" and when something doesn't smell right, there is usually some piece of the puzzle that I don't have.
I am not sure anybody on these boards really knows anything pro or con but there are people that REALLY KNOW. Those work at larger biotechnology companies. At this stinking price $31 million buys control. And yes that would push up the price but a hostile offer @ 1.50 is still only $159million. If this is as good as we think the smart money should be on the move. I worry that we are missing something.
I'm under the impression that manufacturing is relatively cheap, but can't lay my hands on sources. The company presentations typically include boilerplate about the superiority of defensin mimetics over those found in nature, including expense of manufacture:
" Given their broad activity profiles, amphiphilic HDPs appear to be ideal therapeutic agents, however, significant pharmaceutical issues, including poor tissue distribution, systemic toxicity and difficulty and expense of manufacturing, have severely hampered their clinical progress. We have developed a series of non-peptidic mimics of the HDPs that have distinct advantages over peptides for pharmaceutical uses. The approach is to capture
the structural and biological properties of HDPs within the framework of inexpensive oligomers.