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Cerner Corporation Message Board

sonomaca 135 posts  |  Last Activity: 11 minutes ago Member since: Dec 18, 1998
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  • sonomaca by sonomaca Nov 12, 2015 9:01 AM Flag

    Should have around $8 million in the bank right now.

  • DPP Cancer is apparently starting to become interesting. They are confident enough to be seeking other opportunities in oncology. This could potentially be very big, just like malaria.

  • This company should be valued at 2.5x-3x revenue given the growth potential. This should be an $8 stock right now.

  • Reply to

    conference call

    by mjh194353 Nov 12, 2015 10:57 AM
    sonomaca sonomaca Nov 12, 2015 11:38 AM Flag

    Couple of notes:

    They snagged an exclusive agreement with what is apparently the best reader on the market. I have to think that without the promise of malaria this would not have happened.

    Sperzel touched on plans for malaria. We're looking at two further quarters of testing, at which point RVR will start producing kits. CEMI apparently has the distribution channels in place necessary to do this themselves. The big question, then, is when they will begin to see non-CDC malaria revenues. Middle to late 2016?

    No mention of the WHO prequalification slip-up on DPP HIV-Syph. Does this mean that problem isn't fixable?

    The tone of the discussion on cancer is somewhat different. It would seem that DPP Cancer works better than anyone had expected. The experience with malaria, whereby DPP with reader could detect at extremely low levels, leads me to believe that the cancer test can do the same. Has CEMI developed a screening tool which can detect micrometastases/CTC's for one or more cancers?

  • sonomaca by sonomaca Nov 12, 2015 12:12 PM Flag

    Could CEMI be worth half a billion dollars? Much of this comes down to the size of the malaria/febrile illness market, but we all know how much money there is in cancer diagnostics.

  • Reply to

    How much?

    by sonomaca Nov 12, 2015 12:12 PM
    sonomaca sonomaca Nov 12, 2015 12:42 PM Flag

    Can someone please give Sperzel a raise.

  • Reply to

    conference call

    by mjh194353 Nov 12, 2015 10:57 AM
    sonomaca sonomaca Nov 12, 2015 1:40 PM Flag

    Good post. Alere is always a threat. On the flip side, CEMI must be a real irritant to ALR. They had a chance to buy CEMI 4 years ago, and passed. Probably not a great move, but I'm glad they didn't.

  • Reply to

    Some really good things in the financials

    by mo.scuba Nov 12, 2015 1:39 PM
    sonomaca sonomaca Nov 12, 2015 1:50 PM Flag

    I don't really buy the 0 to 60 comment. We know from the Lima slides that they had already tested DPP malaria early in 2015. I think they were quietly working on this in 2014, but when ALR got a Gates grant for ultrasensitive malaria late last year, CEMI had to go public with their efforts. This has been a priority project for JE. It isn't often that someone can say, "I helped in a significant way to eradicate one humanity's greatest scourges"

    Must keep JE happy. His 2nd gen DPP device, with the self-contained buffer, is awesome.

  • Reply to

    Some really good things in the financials

    by mo.scuba Nov 12, 2015 1:39 PM
    sonomaca sonomaca Nov 13, 2015 10:26 AM Flag

    Might be another cancer. The superior sensitivity with regard to malaria leads me to believe this might be a whole blood or plasma test which detects circulating tumor cell antigens at very low levels.

    I think CEMI envisions a multiplex screen for a variety of common cancers. That would be revolutionary.

  • Reply to

    Zacks

    by cometfinder Nov 13, 2015 10:17 AM
    sonomaca sonomaca Nov 13, 2015 10:28 AM Flag

    I think he's being conservative. He's not going to count tropical disease revenue until it actually appears, but it may very well appear in mid-to-late 2016. If it does, revenue is going to be substantially more than $30 million next year.

  • Everyone has probably heard by now that a major Hollywood star is HIV positive and has been recklessly having relations with a variety of people, men and women. When the name is finally made public, I think there's going to be a rush of people seeking HIV testing in the US and around the world. Similar to when Magic disclosed his status.

    This could certainly benefit CEMI.

  • Reply to

    HIV and Hollywood scandal

    by sonomaca Nov 13, 2015 11:16 AM
    sonomaca sonomaca Nov 13, 2015 11:35 AM Flag

    I think this helps to explain OSUR's recent rise. They will benefit even more than CEMI, although CEMI has the OTC HIV product in the UK where newspapers are pumping this story.

  • Reply to

    Clearly the street HATES this deal

    by getshorty101 Nov 2, 2015 3:00 PM
    sonomaca sonomaca Nov 13, 2015 1:27 PM Flag

    Took a flyer today. I figure that Lurker and the other insiders are going to find a way to salvage the couple million shares they own.

  • Reply to

    Clearly the street HATES this deal

    by getshorty101 Nov 2, 2015 3:00 PM
    sonomaca sonomaca Nov 14, 2015 11:58 AM Flag

    Well, given the $50 million breakeven number, which they have no chance of achieving anytime soon, it's pretty clear the company is going to have to be sold. It would be foolish to run down the cash, issue new stock and/or take on debt for more than a couple of quarters. A larger diagnostics company could fold the PDI product line into an existing portfolio, and thus drastically reduce costs.

    So, my advice is: fix up the assets as quickly as possible and sell it all some time in 2016.

    That said, Lurker has blown through $100 million. Has she learned her lesson? She's not getting another job, that's for sure. If the value of her stock goes to zero, she's going to be running a register at Walmart. Does she realize this? Has she learned her lesson?

  • Reply to

    Clearly the street HATES this deal

    by getshorty101 Nov 2, 2015 3:00 PM
    sonomaca sonomaca Nov 14, 2015 9:33 PM Flag

    Well, given the fact the company is now much smaller than previously, I would think that the executives would be due for a pay cut, or a transition to more incentive-type compensation. Lurker should voluntarily renegotiate her contract. She can't be taking nearly 10% of the company's revenue in take-home pay.

    If the goal is to spruce up the company and then sell it, it's imperative that PDI not incur new debt. The reason, and I've seen this before, is when that potential acquirers see the debt, they simply sit back and wait to acquire the assets in bankruptcy rather than bid for an ongoing concern. It's entirely logical.

    I've watched Lurker for some years now, and it's important that someone step in and stop her if her plan is patently unworkable. She will keep on going until there's nothing left. That's her MO.

    I address this to the BOD: If PDI can't hope to achieve the kind of revenues necessary to reduce losses to zero within the next couple of quarters, it would be far better to recognize that fact now, while there's still some value. Under no circumstances should this company incur additional new debt.

  • sonomaca by sonomaca Nov 16, 2015 3:23 PM Flag

    If this is all true, I think it's going to kindle interest in HIV testing once again. Perhaps not a big needle mover for CEMI, but something.

  • Reply to

    Clearly the street HATES this deal

    by getshorty101 Nov 2, 2015 3:00 PM
    sonomaca sonomaca Nov 17, 2015 10:36 AM Flag

    Well, she's not the Chairman, but most of the 6 board members have been there a long time. These are yes-men, as they have presided over this calamity without taking action. So, I would agree with the premise of your statement that this BOD is a NL hand puppet.

    I think NL's salary is an important signpost. If she continues to draw that large a salary under these conditions, it just means she's vacuuming up as much cash as possible before the ultimate demise.

    I see virtually no chance that PDI can reach anywhere near the breakeven number of $50 million in revenues (and that was the "minimum") before the cash runs out entirely. A buyer which could integrate PDI's assets with an existing cost structure might find this company interesting, but I wouldn't expect much more than $2.

    The BOD must ask the question: $2 now or $0 later.

  • The end may come more quickly than anticipated. The BOD should accept any reasonable offer at this point, because the alternative is nothing. NL's plan is unworkable given the need for $50 million of revenue. It's patently obvious.

    The remaining assets of this company clearly might be of value to an existing company, whereby the products could be added to an existing cost structure, ie an existing lab, sales force, management, etc. Someone might pay PDI $2 to $3 a share right now for those assets. The alternative is clearly zero for existing shareholders. It doesn't take a financial genius to make the right move here.

    I've given may advice on this board for years. It's been studiously ignored. Will it be yet again?

  • I don't think it's going to be possible to raise more than a few million dollars with a share price of 90 cents. If they try to sell stock, they'll essentially be selling a controlling interest in the company, but at 50 or 60 cents a share. As for debt financing, I doubt they'd get more than a couple of million dollars, and that would add yet more to costs. In either scenario, we're talking about buying a few months of operating expenses.

    Bottom line is that we're a move or two from check mate. The only reasonable solution is to try and sell the company now, before new stockholders or creditors take the assets for next to nothing. Capiche?

  • sonomaca by sonomaca Nov 19, 2015 11:24 AM Flag

    I think the timeline is much more compact than NL would have us believe. I see little chance the company makes it through 2016. I think the stock price will reflect that fact sooner rather than later. The longer they wait to sell the company, the lower will be the bids. The turnaround plan is unworkable. To continue with it will cost the shareholders everything. I'm guessing the most that NL will be able to hold onto her near $1 million salary is another 12 months.

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