The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
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I think the problem is you're making assumptions (wrongly imo).
You're assuming SNG001 results are not out till H2. Not only is that wrong for the published expected conclusion of the trial (which is April). It may be even more wrong as this year's flu spike came two months early and therefore there's every chance the trial could have concluded 2 months earlier (ie this month).
I think it's also wrong to suggest "Synairgen was confident that Pharmaxis would sign a deal in Q4 2019" or were reliant/planning for that. In fact the last placing was explictly done to expand the SNG001 trial and "To provide additional resources to invest in up to two new early stage opportunities which have been identified by the company" and "provide working capital for the company". They've not spent any of that money on new opportunities and should fine.
Biggest question as raised previously is cash and funding. Synairgen was confident that Pharmaxis would sign a deal in Q4 2019. That didn't happen and has been pushed back so funding must be 'tight' to say the least. I can't see any quick resolution as SNG001 results not out till start H2. Any other ideas??
Disagree on the timings.
1) There is literally nothing to stop them announcing a deal in 2 minutes time for LOXL2 (it's impossible to judge that and a potential partner could offer a deal at any moment - stealing a march on interested rivals - fact is it's well overdue already)
3) Trial results for SNG001, the main thing, could be considerably earlier (based on the fact the April estimate would have been based on a flu season which is typically two months later than actually happened). Bring that estimate forward two months and it's February (ie now). Personally I'd bet they already know the outcome, largely speaking, and it's been around a month and a half since the flu levels returned to normal. For all we know they've nearly finished sifting/processing the data for release (or doing deals based upon it). Again hard to tell without being made an insider. I wouldn't be surprised if the background origin of the buying is coming from those who know the gist of the results.
Points 4/5.........this is AIM. The rules regarding disclosure are ignored left right and centre with no punishment (or weaselled around). I've seen TR-1 disclosure notifications where about 10 different thresholds were crossed in one go once finally released. The market makers need these pullbacks, they HAVE to make a market, and think how many shares they've sold on the way up......they NEED people to see a falling market and sell them some shares. Otherwise they've got nothing to sell to buyers and they can't make a market. Right now they'll be desperate to restock their coffers.
As for the major holders - I imagine nothing has changed. They've only ever increased their holdings and a recovery in price is irrelevant. It's still well below their last purchase price in the placing. They'll have been investing for the real value creation event(s) which could now come at any moment (SNG001/LOXL2 results/deals) and quite possibly with a takeover in mind as the end game (that's still got to be a very real possibility here - and would also not be surprised if that ends up being the result here - if someone offered 50p/share here - it'd be peanuts to big pharma and far cheaper than a deal for SNG001 might end up after all the milestones - with the LOXL2 interest proceeds as a bonus).
That's the thing, if I was short-term trading this, I'd have sold out for 17p+ on the spike, as I'm sure a small few did (and then a further few following that, leading to the quick pullback). However, as I wish to be in for the results of LOXL2 or SNG001, where the big money will be made, my incentive to do so is low, as I know there could now be news on either of them at any moment. Predicting when is going to be a mugs game! (it's simply possible at any point from now onwards)
Excellent post. Clear and intelligent anslysis.Credit.
The last Week or two has seen what I call extreme trading..
My thoughts relate to the following...
(1) Pharmaxis : No news expected on Corporate Partnering for LOXL2 until the earliest end of March 20.
(2) Preliminary statement of results for the year ended 31 December 2019 due around end of Feb 20
(3) No News expected on Part 2 of Synairgen’s Phase II clinical trial in patients with COPD until end of Q2 2020, there might be reference / update on the current trial with Preliminary statement of results around end of Feb 2020
(4) No information currently available regarding the near 20% of Neil Woodfords holding, Where is it? Who has it ? and what might become of it.. other than speculation.
(5) No TR-1 from anybody / organisation regarding adding or reducing their current holdings.. including Ex Neil Woodfords stake.
The Market Size for trading SNG shares is 10000.. I appreciate that this can be nothing more than a guide but I cannot relate to where these 6 figure trades are coming from … both buy / sells.. 100K, 125K, 150K, 200 K etc.. The sheer size of each of these trades should be enough to either send the shares to the moon or crashing to the floor.. But still these trade volumes continue..
I appreciate that Market Makers play games to both gather stock and sell stock on their books but the sheer size of some individual trades does in my mind question the reality of current trading. and yet it is happening..With dramatic swings of the SNG share price taking place.. today down nearly 10% other days closing even higher..One might assume as Rich states that there is dramatic action happening behind the scenes..this may be true but no TR1 has been issued either adding or reducing their holdings .. 3% which is the baseline for reporting a major holding would mean that any holder with approx. 3.3 million SNG shares would have to issue a TR1declaring their interest.. Yet nothing..
In summary .. we SNG shareholders have a lot to look forward to , hopefully all good news... but does the current share trading in anyway reflect pure speculation, bored private investors selling up, Market Makers shenanigans, serious purchases by parties unknown but keeping below the 3% threshold.. What I wonder do major shareholders Leonard Licht and Richard Griffiths make of current trading and volatile share price..Perhaps nothing and are more than happy with their holdings and anticipating significant future increase in the value of their holdings..!!
I am anticipating further volatility over the next few weeks.. hopefully positive to the current share price.. Any official news from any source (see 1- 5 above) will I expect have serious impact on the current share price, drive out the speculators and if positive give long term shareholders the reward they deserve.