The good news is the following statement:
-- The outlook is stable, reflecting our expectation that MEMP will
continue to maintain "adequate" liquidity and FFO to debt of 10% to 12% over
the next three years thanks to its solid hedge book.
This almost ensures a div cut, which should now be priced into the stock. This management team needs a shake up/new COO or CEO or President, someone that can drive operations savings. The treasurer is the only hero.
ARNA has been a weight on my portfolio that I would like to lose at about 200% heaver than the current weight. Big volume today, something's happening.
if the CEO had a spine it would have been done 12 months ago, at least! The recent cut was less that half of what is needed. I say we might need 40-50 people MAX.
fine with me if they acquire for a low price with a promise to pay later, or if they strike a deal with milestones that leads to an acquisition in 12-24 months. Either way ARNA must make much larger cuts to the burn rate NOW!!!
and down, so it's not a good combo. Maybe a take-under? Maybe a back-loaded deal where they give us the cash and payments in the future if certain milestones are met? That's one way pharma M&A are dealing with risk. I would take some cash now and promise of future payments if certain milestones are achieved. That might be a little trick with taxes.
today, probably not more than $4-5. If they cut costs and then provide more data in 12 months it might be $8-10, or more depending on the data. I just want my $4-5 back to invest in other companies at this point.
Hiring a whole new team would be too expensive, they have to offer big packages to all of these new people and pay for the current employees to go. Just fire almost everyone, keep only about 50 people that can advance the pipeline, maybe advance anything near the end in pre-clinical, the top bean counter and a few others. Hire a turnaround person, put the company up for sale and when they find something of value, or have a decent offer, sell. I don;t want them wasting any more shareholder money on new research and I don;t want to continue paying for their 250-300 failed Directors and VP's. They are way to top heavy with sub-par talent.
If they would do a better job of running the operations and cutting cost, they could keep the distribution up near the current level. This company needs to be sold to a stronger operating firm, or to a larger company.
I'm also concerned that management would like the stock price low because they are hoping to get a new pool of free options to give away. I hope shareholders say H-No!
I'm not interested in any more partnerships, any definitely now any debt, or low-priced secondary offerings...ARNA management needs to cut costs to the bone and put the company up for sale. When they have some phase II evidence and acan strike a reasonable deal, just get me out. They have wasted enough money and time and I don't trust ARNA management to run a pharma business. If they cut deeper and faster, they have 2 years of cash without the need for dilutive offerings or risky debt financing.
I'm guessing you're not an attorney because that is a very weak argument. Eisai made a terrible decision and I don't think there will be another chump or greater fool. Someone might pay $750 or $1BB for the entire company, but nobody will pay $750 up front for this drug unless/until they have serious data on large numbers of patients.
1) more, deeper and faster cost cuts and 2) an acquirer.
Unless the make a serious dent in the burn, another partnership deal will not be enough, the cash is being spent too fast.. Issuing debt would be the beginning of the end of the company.
Fool, Spencer, yes I know that's redundant... What is this BS statement about needing $100MM to maintain a going concern status? There are many companies that have well less than $100MM, but not many that burn as much as ARNA, hence the need to make much deeper and faster cuts.
I think Eisai would give their deal away to get out of the required ongoing trials cost if Pfizer would offer them something, maybe some deferred revenues if certain sales milestones are met. ARNA sum of the parts should be worth at least $4-5 now if they would stop burning the cash so fast. Then of course we have to pay these people who have created no shareholder, really destroyed value for years to leave, it's ridiculous. It's past time to put the shareholders first.
if they don't cut the costs faster we will get zero because this drug is 3-4 years away from the market at least. ARNA has 2 years of cash, we need faster, deeper cutting. Hixson was about as impressive as JL, NOT.
that's basically what I've been saying fire almost everyone and have consultants manage the clinical trials.
their "off the shelf" technology sounds more similar to CEGE, which went down faster than DNDN, but it sounded exciting. Someone may want to lock them up, or partner.