Ireland's tax rate remains at 12.5%.They only eliminated the "The double-Irish manoeuvre, which involves making tax-free royalty payments to subsidiaries that are incorporated in Ireland but are tax residents of a country with no corporate income tax. The Budget 2015 changes will require companies incorporated in Ireland to also be Ireland tax residents. The details of how this will work were not revealed on Tuesday but will be included in the upcoming Finance Bill. The change will be effective January 1st 2015. There will be a transition rule that will apply until the end of 2020 for companies in existence before 2015, giving them time to restructure their businesses.
While the Budget 2015 statement eliminates the double-Irish loophole, it does not raise Ireland’s low 12.5% corporate tax rate. Other tax-minimisation strategies involving Ireland are also not affected."
right now the market is treacherous - big institutionals let smaller investors bid up the market in the morning, and then slam it down in the afternoon. I stepped to the side until this market decides what it is going to do.
ok magnam, that's reasonable. I was conjuring up a scenario where Gt1 trial was not a 'knock it out of the park' result so the focus by the presentation date was now gt3. But your explanation is reasonable, so Ill go with it.
if you mean they don't want to tie up the phase 1 3422 data for a month, I agree with you. I think they have it now, and I think it's 50-50 that it's good or not. There is a conservative scenario that looks like this: 3422 phase 1 didn't go as well as planned. However, ongoing data for SVR in 3102 plus sofobusvir is going gangbusters. So they ACHN waited to release disappointing data on 3422 phase 1 until after they could announce the late breaker poster presentations, one of which focuses on gt3 for 3422, but not any of the other genotypes. Now they are free to release the 3422 data, which could be bad. (Remember, it was not until phase 2b that the BMY nuc purchased from Inhibitex failed due to causing heart failure, and prior to that it had stellar data. 3422 has a long way to go, and it may not have done what it was supposed to do in phase 1 on gt1 - that is one possible reason why the results have not been released yet.) The safety valve for this scenario is that 3102 is worth at least 50% more than the current market valuation, by itself (at least I think so). So even if 3422 failed in phase 1 against gt1, which would cause a $4-5 fall, it should come right back.
My take: the only shareholders that will come out of this with something are the preferred. They purchased $20 mill in convertible preferred, and $25 million in debt financing that are convertible notes. the company is currently worth $11 mill. The most likely scenario is that a private equity firm will force this into chapter 11, restructure the debt and equity - and buy out the preferred shareholders at a reduced rate. the common shareholders will get nothing. I sold at .38-.40, and obviously I've been trying to find a re-entry in the event of sale or merger discussion, but I just don't see the common holders winning out here; the disparity between the current valuation and the $45 million that is held exclusively by preferred shareholders is too great. I may be wrong (always that chance), but this fish stinks at this point, which is why the price of the common stock price has fallen since the announcement, not risen.
Sentiment: Strong Sell
magnum, et al, there's something gnawing at me. ACHN said they would have 3422 phase 1 results about now. They were specifically dosing hcv patients with genotype 1. However, the title of the only late breaker for 3422 that includes a genotype is this: "ACH-3422, a novel HCV NS5B RNA polymerase nucleotide inhibitor, demonstrates improved potency over sofosbuvir against HCV genotype-3 replicons in vitro." Nothing that I see refers to the phase 1 results in gt1. What's your take?
make no mistake - I am a huge ACHN supporter and have a sizable position. I still think GILD will acquire it.
binary, I generally agree, but the strength of the theory is somewhat mitigated by the fact that most of the GT3 cases are in India and parts of Asia - poorer countries. As you know GILD just cut a deal with five generic drug manufacturers in India to make Sovaldi and sell it for $900 per treatment in India. So the "premium" on GT3 may be largely muted by the time 3422 comes on the market.
it won't be game over for ABBV. They have Enanta's protease inhibitors which are every bit as powerful as ACHN's. Once you are at a 90+% cure rate, it gets down to a matter of price between the drugs. That's why I own GILD, ACHN, and ENTA.
and also me - on that page. I believe GILD will acquire ACHN. They know the company intimately through a ten year partnership, and they could use 3102 and 2684 right now - at least one and possibly both appear to be more efficacious than ledipasvir. And if 3422 pans out, all the merrier. GILD would ensure their dominance in this space for at least a decade with an ACHN acquisition.
Sentiment: Strong Buy
If that happened they should make Tracy Gardner the CEO of the combined company. I wouldn't be surprised if Delias is taken private.
blhw, technically I should be a silent observer at this point since I just sold my shares (which I've done a few times before), but I just had to chime in to suggest that you focus on - oh I don't know - energy stocks? Utility stocks? Maybe technology, but not biotech. Based on what you said I can't fathom how you would begin to decipher the differences between five different emerging biotech companies that all have negative EPS with growing revenues. I really don't think you'd have a clue - so you should go take a class on biotech investing, perhaps. (No offense!)