Why is it "nice work" to personally bash a poster who tries to give a positive view of things. Rmsacc used to be a raging bull and now he's a cynical grouch. Truth is, it is very difficult to assess what is going on and Geert might be getting it right and maybe not. How about we all give our views of that and quit worrying about each other.
Geert worked for J&J for a long time and, in the latter years there, spun of dermatology assets. He got financing and, then, developed Barrier and then sold it off. He has experience not only building but marketing companies. So why is he having so much trouble communicating with us shareholders? Here's a possible reason:
Geert is used to talking, schmoozing or kibbitzing, with ceo's and other decision makers. He can have lunch with them, explain things, clarify things directly. That is MUCH different from having to make formal presentations or communicate through press releases. In those kinds of cases, words must be chosen very carefully, every word is parsed and tea leaves are examined, there can be no direct follow-up to the questions listeners or readers might have.
Geert just isn't good at those things and neither are his associates.
Mea culpa. My $700 million figure for Barrier Therapeutics was way wrong. The sale was for $148 million.
The company says on its Q&A that is has hired additional people to work on the things it already had in the pipeline. It suggests that this new drug and the work involved will be in addition to, and not in replacement of, what had already been planned. There is no reason I know of to think the anti-aging and opthalmology work will receive any less attention now than they would have if the new drug were no on board.
The company is trying to expand its horizons, not to refocus them.
Read the Q&A on the website again. Quite a few reasons are given for buying Samcyprone. Among them are: It improves upon existing DPCP drugs by making it unnecessary to give huge initial doses and thereby Samcyprone avoids bad side effects and negative reactions to follow up doses; it provides another quiver in Rxi Pharmas quiver; it provides some important investigative avenues for additional sd-rxrna targets and usages; It was fairly inexpensive for all those and other potential benefits.
As to the company's current views about RX-109 (which is of the most immediate importance, imo) I found the following positive statement in the Q&A, "RXI-109 remains a top priority, as the compound is providing proof of concept for our sd-rxRNA technology platform, which is a core part of the value of our Company." Notice that it says "...IS PROVIDING [my emphasis] proof of concept for our sd-rxrna platform." This company weighs each and every word carefully, maybe too carefully in some ways. When it says it IS PROVIDING proof of concept..., you can take it to the bank, I believe.
You say: "I don't see them abandoning RX-109 just yet, but after 2015 if nothing has changed? IDK."
The decision on rx-109 will for sure come before the end of 2015. If the clinical trials by then do not confirm that it works, it's gone. That's the paramount question: Does rx-109--and by extension sd-rxrna--work?
I agree that it would be nice to know more about the financial structure of the Samcyprone deal but that is secondary. Without rx-109, and certainly without sd-rxrna, we are done. Well, I guess Samcyprone could save us in case of the total failure of the basic Rxi Pharma platform, but I doubt it.
It would be nice to have the company explicitly and forthrightly tell us that they are satisfied that rx-109 works but I do not expect that to happen. They will continue to be at best indirect about that. And because of that, we will continue to flounder on the stock market. Time to step aside (i.e. sell) and wait for better information? That's a decision each of us has to make for him/her self.
I feel your frustration. The hesitancy to come straight out and say that rx-109 seems to be working troubles me. On the other hand, even the weak pr the other day suggested that the company was satisfied with rx-109's performance to date.
Part of our problem (or maybe just mine) is the weak investor response and the effects of possibly professional bashers, such a Dirk Hausser (sp?) We want reassurance and Geert wants to tell us what he thinks he must know w/o risking over hyping and overstatement. Maybe on legal advice. He will not be a cheer leader and that makes us, or maybe just me, think things are bad. Better to under promise and over deliver--and that's what I hope is happening, but I have qualms.
I'm okay about the new drug we just bought and think the account was good.
Wow! Your attitude towards Geert has really changed. That's not a criticism.
As for Samcyprone, I believe that the company gave a pretty clear explanation of why it chose that drug in both the press release and the Q&A on the website. Geert would not have been willing to sink the kind of money into it that he has if there weren't good reasons to think it would be a money maker, nor would the board have let him. It might not work out but you can be sure there was plenty of due diligence and market evaluation.
Your comment on the sx-109 and sd-rxrna is very important. IS Rxi Pharma now pretty much pushing them onto a siding? The company explicitly says NO in its Q&A.
I agree that we need more insight into what the company's current thinking is about the prospects for RX-109.
I too am far less bullish than I was. However, I can also see how this could work out very, very well.
Maybe Geert sees Samcyprone as the blockbuster and has more or less given up on rx-109, despite what he says in the Q&A on the website. Samcyprone might be the white knight that rescues the company?
We need some results and lots more clarity on the rx-109 situation: 1. Is there a possible design flaw such that rx-109 is migrating to the placebo side, thus making the placebo side less robust? 2. Is the size of the rx-109 scar at three months more, less, or about what was expected by the company? 3. Are more dramatic results expected at 6 and 9 months?
The company could shed light on those matters now, and should.
"RXII seems to be the red headed step child of the three [RXII, CYTR and GALE.]"
So far. We'll see.
I agree that the three month comparisons were very close between rx-109 and placebo. That might well be because neither the placebo nor rx-109 grew much in three months. Maybe such scars just take longer than three months to grow to an extent that could show a difference between rx-109 and placebo.
Such an account, or "excuse" if you will, won't work at nine months. Maybe we should not get too excited just yet.
They must come up with nine month results by late 2015 because that will be nine months or more from the surgery date. If they cannot show good nine months results by late 2015, bye bye Rxi Pharma.
First, here's my realistic view of total shares:
1. 21 million outstanding as of Sept. 30.
2. 17 million common underlying preferred as of Sept. 30.
3. Approximately 5 million options as of Sept. 30.
4. 7 million to Halpten (worst case scenario) for Samcyprone.
We have, then, about 50 million shares including the most recent acquisition.
Operating expenses are $10 million per year. At $2 per share (very worst case scenario) that would be 15 million shares over the next three years. 5 million shares for one years operating expenses, worst case.
Total shares 65 million in three years, 55 million in one year. Maybe a bit more if expenses increase but I don't expect another drug purchase.
Now as to timeline. RXI-109 is probably key. We will know if it works by the nine month results. That is, we will have a pretty good idea of the viability of Rxi Pharmaceuticals by the end of 2015 or even by the end of Q3 2015. That's my timeline.
If RX-109 is shown to work by late 2015, we will be a $1 billion company within two and a half years and a $3 billion company within five years. If RX-109 is shown to be a bust by the end of 2015, we are toast.
That's how I see it.
The up front payment to Halpten will come from the proceeds of the stock sale to LPC. That is what the LPC pipe is for. There will not be any shares due Halpten in addition to the up front cash og $10.5 million. In sum, the only dilution will be the shares to LPC for the $10.5 million cash it provides.
Dilution has become quite a boogeyman. The very term "dilution" strikes fear in the heart of individual investors. I have a suggestion about how to take some of that fear away. Just assume, in your evaluations, that the maximum dilution will take place. In the case of rxii that would be 100,000,000 shares. That is the total the company is authorized to issue. [I suppose it could revise its authorization to, say, 200,000,000 shares but let's leave the maximum at 100,000,000 for the purposes here. 100,000,000 is way, way more than any of us have been thinking about anyway.]
Now make a judgment of what you think a realistic market cap will be. I believe that a realistic market cap in two and a half years is $1 billion. That would be a per share price of $10. Not bad. I believe a realistic market cap in four years is $3 billion. That would be $30 per share. Even better.
My point? Don't fret a lot about the dilution that occurs along the way. Whether the dilution for the up front Samcyprone asset is 7 million, 3 million or 1 million shares won't matter to you at all if you assume that we will dilute more than 50 million shares from here (factoring in Tang's potential common)--to a total of 100,000,000--anyway.
It's either lots of dilution or lots of debt to obtain the funds we need. Debt is out of the question. If this works, the dilution will be way worth it even if it is to 100,000,000 shares; if it doesn't work, the dilution doesn't matter anyway because we will be dead.
First, there were 100,000 shares issued as an "origination fee"--sort of like points on a new mortgage. There were also 100,000 shares issued when the first LPC deal was made. Total 200,000 shares issued w/o cash received. Also, under the first deal, LPC purchased 500,000 shares at $4 p/s.
As to your question of how many shares will be issued for sancyprone, it depends on the mkt. price at the time rxii directs LPC to buy. There is $10.5 million available. At an average of $1.50, that would be a dilution of 7 million shares, if the entire $10.5 million was accessed. At an average of $3, that would be 3.5 million shares, if the entire $10.5 was accessed.
The above is just the dilution from accessing LPC for the up front payment for Samcyprone. In addition there should be milestone payments and royalty payments to Halpern as Samcyprone achieves success. Those payments would probably also be made in rxii stock. Dunno how much further dilution that would be.
Rxi Pharma will make no cash outlay, nor will it take on any debt, for the Samcyprone asset; there will, though be dilution as discussed above.
If Geert and his associates think it is worth the money, time and labor needed to bring an anti-scarring drug (rx-109) and an anti-wart drug (Samcyprone) to market, believe them. They collectively understand the dermal market as well as anybody else.
Some on this board have been dismissive of the scar and wart targets. They have suggested that they are not worthy of serious biopharma research. Well, Geert and friends think such dismissive attitudes are wrong. I'll have to go with Geert here. Never underestimate the financial potential of what might at first seem to be unimportant things.
Does rx-109 work? Dunno. I doubt that the 3 month pictures will settle that issue. How about Samcyprone in conjunction with sd-rxrna? Dunno. If they do work, there is probably a big enough market to bring us all thirty or forty baggers--certainly if they also work on eye disorders and melanomas. Worth a shot at the current price of the stock? I think so.