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VirnetX Holding Corp Message Board

duckduffer 1478 posts  |  Last Activity: Aug 27, 2015 1:01 PM Member since: May 29, 2003
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  • Reply to

    Shorts....

    by m_mccruden Aug 27, 2015 9:10 AM
    duckduffer duckduffer Aug 27, 2015 1:01 PM Flag

    "Those folks won't go anywhere no matter what happens to the SP. Risk free return on the coupon"

    Let's say the PPS goes to $15 in a buyout. The convertible holders who we are assuming are currently hedged with a short position, will then simply cover their shorts through the conversion of their convertible bonds. Makes complete sense, no risk at all to them to keep shorting....unless....you consider the upside they will leave on the table by not having covered at say $5.85. Up until the topline RCC data, that wasn't a real possibility. But today...very real. As a convertible holder, do you cover the short hedge soon, or miss the big upside? A 200% upside oppty vs a 4.25% coupon until at least 2016, the earliest EXEL could cash them out. I realize the arbitrage play it isn't as simple as that with all the options, etc, but as Snow has indicated, "The endogeneity of convertible bond arbitrage should slow (like soon) as corporate news events gain exposure."
    I for one believe the smoke will clear for a significant move in the PPS with the unveiling of the full RCC data.
    GLTA

    Sentiment: Strong Buy

  • Reply to

    Nivo continues to haunt Cabo

    by efrat99 Aug 26, 2015 10:34 AM
    duckduffer duckduffer Aug 26, 2015 4:54 PM Flag

    There is probably some truth that there are those sitting on the sidelines waiting for full data release and a glimpse at the Nivo data. After all, many agree that this stock should be trading at a risk adjusted $3B valuation. When all the smoke clears (ECC presentations) and it becomes very clear that Cabo has a $600M opportunity in 2nd line RCC....it will be very interesting to see how long it takes to reach that valuation. My guess...before the end of 2015. At the newly adjusted shares outstanding of 225M, that makes the PPS $13-14. If someone decides they want to take EXEL out, it will have to happen after we reach that fair valuation, not before IMHO. The BOD of this company can figure out a risk adjusted fair valuation so why would they sell for anything less than a premium on that value.
    GLTA

    Sentiment: Strong Buy

  • Reply to

    Nivo continues to haunt Cabo

    by efrat99 Aug 26, 2015 10:34 AM
    duckduffer duckduffer Aug 26, 2015 3:55 PM Flag

    "Nivo is at 1610 and Cabo at 1620"
    LOL! It's how things are done. Somewhat akin to how the headline act performs after the warm up act or how the winning golfer waits to putt out the winning putt until after his non winning partner finishes. Nobody wants to follow a better performance. And they wouldn't set up BMY to follow EXEL if BMY has lesser data. So they didn't, BMY is going first.
    GLTA

    Sentiment: Strong Buy

  • Reply to

    Nivo continues to haunt Cabo

    by efrat99 Aug 26, 2015 10:34 AM
    duckduffer duckduffer Aug 26, 2015 3:43 PM Flag

    "most recent B/T status drugs shows Cabo on 8/24/15 and most recent prior to Cabo was Levantinib on 7/29/15"
    What are the chances they would grant B/T to Cabo after the fact, if the data was inferior to Levantinib?
    That is your point I'm assuming and it is another good one.

    Sentiment: Strong Buy

  • Reply to

    Nivo continues to haunt Cabo

    by efrat99 Aug 26, 2015 10:34 AM
    duckduffer duckduffer Aug 26, 2015 1:04 PM Flag

    "interesting is that breakthrough for Nivo in RCC has not been announced yet"
    Very interesting. Topline announcement within hours of each other. One might assume BMY has a top notch team submitting applications for accelerated approval in a streamlined process. Could it be the data just isn't that strong or perhaps its just not as compelling as Cabo? BMY had the luxury of knowing how good Cabo's HR data was. Perhaps an application was never submitted. As noted, however, still might be on the way.
    GLTA

    Sentiment: Strong Buy

  • Reply to

    Nivo continues to haunt Cabo

    by efrat99 Aug 26, 2015 10:34 AM
    duckduffer duckduffer Aug 26, 2015 12:16 PM Flag

    Not to discount Nivo as competition for Cabo, but even if Nivo blows away Cabo's OS data, there will still be a huge oppty for Cabo in RCC. Cabo is clearly far superior to every other second line treatment based upon the topline HR data presented from the METEOR trial. Nivo only works for a relatively small percentage of the patient population in RCC. Cabo will be the treatment option of choice if Nivo fails. That is not a small opportunity. And for all we know, with BMY keeping their data under wraps until ECC, Cabo may ultimately have superior data trends in OS.
    GLTA

    Sentiment: Strong Buy

  • duckduffer duckduffer Aug 18, 2015 4:49 PM Flag

    Be great if somewhere in that mix is an announcement of a NCI sponsored Phase 3 predicated on the Study E1512 in EGFRwt NSCLC. It would be hard for the market to ignore a Phase 3 based on a Phase 2 readout with a hazard ratio of .35 and 13.3 months OS vs 4.1 months OS for the combination of Cabo/Erlo versus Erlo alone.

    Sentiment: Strong Buy

  • Reply to

    RATINGS UPGRADE

    by saltydog711 Aug 17, 2015 9:21 AM
    duckduffer duckduffer Aug 17, 2015 4:21 PM Flag

    Do you happen to know offhand if Schwab also changed their margin requirement? They were requiring 100%, basically it wasn't a stock that Schwab would allow margin trading.

    Sentiment: Strong Buy

  • Reply to

    Converts at 5.91 and closing prices

    by twodogsfracking Aug 13, 2015 4:16 PM
    duckduffer duckduffer Aug 14, 2015 7:40 PM Flag

    I would absolutely agree on the downside to the convertibles being the "arbitrage" strategy that was employed by the convert holders over the past several years. I just don't agree that EXEL had other viable options at the time. MTC hadn't been approved and it clearly wasn't a slam dunk we found out later due to OS data being less than convincing at that point. Knowing MTC approval could get denied and having already tapped the market with the common offering, the convertibles were a deal with the devil for sure. But a deal that had to happen for Meteor and Celestial to have been launched. A hot topic among the MM haters on this board, but it is what the situation was at the time. How the pricing of the offerings was conducted is a whole different matter and clearly was a poorly managed event for shareholders.
    GLTA

    Sentiment: Strong Buy

  • Reply to

    Converts at 5.91 and closing prices

    by twodogsfracking Aug 13, 2015 4:16 PM
    duckduffer duckduffer Aug 14, 2015 3:51 PM Flag

    There are so many things incorrect with this post, it begs for a response.
    "1.) The financing for the (failed) Comet study was largely funded through cash raised through 'convertible bonds'."
    Not exactly. The convertibles were primarily issued to fund Meteor and Celestial. They did a common stock offering at the same time as the convertibles which would have more than covered the cost to finish the Comet trials.
    "2.) The structure of the bonds and financing allowed, actually encouraged, shorting by hedge funds and others because they knew their losses capped at the 5.91 convert."
    Not so. The convertibles have a strike price of $5.31 and are due in 2019. To be converted earlier than 2019 would require a PPS of $6.91 for 20 out of 30 consecutive days. For the next 4 years the only price that matters to convertible holders is $6.91.
    "3.) The bonds can be 'forcibly' converted to shares by EXEL only if share price remains above $5.91 for 30 CONSECUTIVE days"
    Again, not exactly. The real price necessary for early conversion is $6.91. And that can't occur until 2016. So any movements at this level are not likely due to convert holders manipulating the market.

    GLTA

    Sentiment: Strong Buy

  • Reply to

    Off Label Usage

    by commonwealthinc Aug 11, 2015 8:48 AM
    duckduffer duckduffer Aug 13, 2015 5:27 PM Flag

    "It will make it harder to have blockbuster drugs"
    True, but it will also lower the cost of research dramatically. Imagine knowing after a Phase 1 the specific biomarkers in which your compound has the most efficacy, in much greater detail and depth than today. Think of the research cost of failed Phase 3 trials. In EXEL's case, the Comet trials probably cost north of $100M each. There is no question Cabo (as demonstrated in the visceral mets population of Comet) has significant efficacy in CRPC. But in EXEL's hurry to get Cabo to the market they started the trial with limited data. The trial design was more theoretical than evidence based. And it cost them. The advancement of profiling technology in biomarkers will without question make biotech more profitable (if your drugs work) and drugs less expensive to develop.
    GLTA

    Sentiment: Strong Buy

  • Reply to

    Tomorrow: +7%

    by wazoo_wazoo_wazoo Aug 11, 2015 4:57 PM
    duckduffer duckduffer Aug 11, 2015 7:06 PM Flag

    "Last qtr was an earnings estimate beat, and this qtr was short of that"

    The year over year progress was almost identical. Huge reduction in expense and consistent growth for Cab. Of course this time we have Meteor topline in the bag. That might count for something.
    Last quarter the PPS also went down like 12% the day of earnings and up the following day. So perhaps we will split the difference and be up by 12% tomorrow instead of 24%.

    Sentiment: Strong Buy

  • Reply to

    Tomorrow: +7%

    by wazoo_wazoo_wazoo Aug 11, 2015 4:57 PM
    duckduffer duckduffer Aug 11, 2015 5:40 PM Flag

    Very solid call. Sales in line, 22% growth, expenses lower by $30M, cash over $300M, actively engaged in partnership discussions for ex US rights to Cabo, and it even sounded like they were hinting at a possible breakthrough status request being on the table (lot of mention of their urgency in getting the filing done for RCC).
    Last quarter with a lot less positive news than this the PPS went up by 24% the day after earnings!
    GLTA

    Sentiment: Strong Buy

  • Cabo sales up 21% year over year. Net loss down $30M year over year. And lots of catalysts to come.....
    GLTA

    Sentiment: Strong Buy

  • duckduffer by duckduffer Aug 11, 2015 2:04 PM Flag

    The "analysts" estimates are for a loss of ($.21). That is a 44% improvement over the prior year.
    The "analysts" revenue estimates are for revenue of $8.69M. That is 32% growth over the prior year.
    If they come even close to those estimates, the numbers are pretty solid.
    But the reality is....today's earnings mean nothing compared to what is projected from a Cabo approval in RCC (Meteor) and a Cobi approval in MM. Those are the real catalysts and any suggestion that today's results have significance is intentionally misleading.

    Sentiment: Strong Buy

  • duckduffer duckduffer Aug 11, 2015 1:32 PM Flag

    Brilliant strategy....if it happened in the past...it has to happen. Oh wait...last quarters (4/30) earnings call EXEL surprised the street with a reduction in research and development expense of over $30M and a net loss of less than half the prior year period. The PPS went up 24% on the day following earnings (May 1st). You may want to close that short before the end of the day champ.
    GLTA

    Sentiment: Strong Buy

  • Reply to

    Tomorrow

    by duckduffer Aug 10, 2015 2:39 PM
    duckduffer duckduffer Aug 10, 2015 2:55 PM Flag

    "Where do you think EXEL could be by the end of 2015?"
    I agree with Ohad Hammer, I think the valuation of EXEL should be around $3B. It may take until the end of 2015 to make the move, as that is more than a double from here. As stated on this board ad nauseam, there are a number of catalysts between now and EOY '15, and possibly even some surprise catalysts the bears aren't expecting. Lot's of stuff on EXEL's plate, should be a very interesting next 5 months.
    GLTA

    Sentiment: Strong Buy

  • duckduffer by duckduffer Aug 10, 2015 2:39 PM Flag

    Not only do we get earnings tomorrow, but we also get an updated short interest report from Nasdaq. This report will cover the period from 7/15 thru 7/31. During that period positive Meteor results were announced (7/20) as well as the cash raising (7/23). The status of the short interest following these events will be very interesting.
    GLTA

    Sentiment: Strong Buy

  • Reply to

    Stop blaming Cramer

    by bigmoneydave Aug 7, 2015 9:55 AM
    duckduffer duckduffer Aug 7, 2015 12:29 PM Flag

    IMO earnings are currently nearly meaningless. Yes, it would be nice to see YoY revenues increase from MTC sales, but that is not significantly material to the long term profitability or growth of the company. The expense line was quite a nice surprise last quarter, it would be nice to see that trend continue, however, there were a couple of anomalies in those numbers that could mean expenses will increase this quarter. Expenses will definitely be increasing going forward. Bottom line, the earnings call should be less about actual earnings for investors and more about the direction given on matters such as partnerships, trials, FDA submissions, etc. This is still a developmental biotech.
    GLTA

    Sentiment: Strong Buy

  • duckduffer by duckduffer Aug 5, 2015 5:06 PM Flag

    what always happens when Cramer endorses a stock on Mad Money? It pops the next day (Tues) and the mo mo gang that plays off his recommendations sells the pop the following day (today).
    Perhaps I've not been paying close enough attention lately, but that surely has been the pattern in the past.
    GLTA

    Sentiment: Strong Buy

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