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guessing a few are now thinking any deal will be Q1 2020 so share price has drifted down a little, however, a few are speculating that the UK GE today may be having an influence.
IMHO I think a deal must be reasonably close, else market would be informed. It might slip by a few weeks or maybe it will be done in a few days. Who knows. I do know that a decent deal is not priced in to the share price and so an immediate 20-30% uplift is possible
I believe the appeal is only regarding the last few years of the patent so something like 2032 v 2037 (might have the dates wrong - off the top of my head).
I'm told appeals are made as standard and are often to get the full explanation for the decision - i.e. to inform future decisions rather than impact the immediate one.
Also, if this was a concern the deal could be structured in such a way as to mitigate against any unforeseen circumstances e.g. £30m upfront with another £20m based on unsuccessful patent appeal and Royalties say 35% rising to 40% based on the same. I think both sides will want to bring this to market asap so will not delay once an agreement is close.
When mentioned CEO always seems very laid back about the appeal and makes out it's just standard process.
I'm wondering if the outstanding appeal from TEVA regarding the Ferracru patent is putting the American suitors off signing up to a deal until this is finally resolved? If so, and as there has been no further news on the appeal situation since June RNS, it could be a very long time before any deals get signed.
When will news drop?
Thanksgiving is now firmly out of the way so hopefully the Q4 guidance will still hold. If it rolls into next year by a few weeks not overly concerned - must be quite close, else STX would have to update market
smalltrader - in answer to your question it depends on the size of the deal.
FDA approval was a massive hurdle and the full coverage for all iron deficiencies is a big plus. This is wider than Europe, I think.
US is the biggest market for this product, worth over £1b per year, so if STX can get 10% of that it's massive.
Hence the uplift when FDA approval was granted.
I'm expecting both a decent upfront payment and ongoing royalties from a US deal.
If this upfront payment is say £50m (FinnCap has stated it could be anywhere up to £100m) then this validates the product IMHO and I don't think this is in the price.
The size of the upfront payment and royalty % also shows that a company is committed and realise the full potential of Ferracru. I think that will be massive.
Also don't forget a Chinese deal is in the pipeline too.
Re the Swiss payment - I haven't checked, but think that was for a specific form of anaemia only so the market will be smaller and the payment reflects this.
Has been watching this but not dipped in yet. Surely this is in much safer position with overcoming the biggest hurdle - FDA approval! But just wondering if the deal announcement is priced in? I myself dont like when one says news in priced in the SP but I thought SP should be way above than where it is lingering since last 3 months.
I read from half yearly report that STX received a meagre 0.5million one-off payment from Swiss partner. why such a low amount? I see that it is a 1Billion market in US but need to see how much the deal with US partner is worth. Not having enough cash after FDA approval and EMA approval? I'm just worried that someone will buy the company for a cheap price and there is not much IIs interest in here? But the next news that will come is about the US partner so no negative news to be concerned about. It is just that we need to see what it will do to the share price with US partner deal.
I agree SP2. Apart from the R&D bit but that’s subjective. Shield are in a great position and it’s investors are too. The share price will fly on US approval that I’m sure. We’re just kicking stones about waiting now as I see it. SP is solid no volatility no shorters ducks aligned just waiting for news.
I’m happy with that. What I was musing over is that if the deal takes longer than anticipated as there are variables out of Shields control then there may be a spot of fundraising.
I hope the US deal is concluded prior to year end and that is what I expect to happen. If we have an announcement that it will slip to Jan no doubt there will be some selling and a price drop. If this happens I only hope I can buy more on the drop. A deal will happen at some point soon IMHO.
we are not R & D a the moment - Ferracru has completed all clinical trials and is being sold in Europe.
FDA approval has been given - for full coverage for all iron deficiencies - so US deal should be better than European equivalent and US is a bigger market. STX is not an IMM type company - it is miles ahead.
CEO has stated cash positive until Q3 2020 and has also stated US deal is wanted ASAP as every day delay is a day's lost revenue.
Only debate re US deal is how much STX will get paid in royalties, upfront and ongoing.That is what is being discussed and these discussions should hopefully be finalised soon - as previous guidance was Q4 , which we are in. STX has a strong hand and are clearly negotiating hard. FinnCap has stated upfront payment could potentially be as high as £100m.
Maybe this will get pushed into early 2020 but to state 6 months is pure guess work - STX has stated Q4 and have not provided any further guidance so let's stick to the facts.
We also have a potential Chinese deal that could drop too
Have you ever invested in an R&D company that didn’t raise funds?
Why is raising funds negative?
It may not be necessary right now but they havnt announced anything yet. What if the deal doesn’t hatch until 6 months time? The company will know what timelines they have and will act accordingly. We can only guess what’s going on but a fundraise is one possibility. I don’t see it being negative more a part of the process.
your comment re possible placing - surely you don't think your comment is a positive??
Clearly you are trying to put doubt in a few people's minds. STX has repeatedly stated funded until Q3 next year
What’s negative ShandyP?
ridiculous to link a TR1 with an imminent placing. Cash is fine until Q3 and recent spend without any trials will be lower.
Both Chinese and US deals will generate significant upfront payments so there are no short term cash concerns (and long term once one or both of these deals get signed).
If cash was a concern a placing wold have been done immediately after FDA approval and that was over 4 months ago. Similarly a director would not have bought a sizeable chunk only 2 months ago if he could have got in cheaper at the placing price.
How about some positive comments - STX has been a fantastic share. CEO has done exactly what he said he would do and share price has responded. Q4 for US deal - we are still in Q4.
Possibly a placing Notrac. Had £6.6m at half year with a cash burn in excess of £4m last year. Not ideal for negotiation when the cupboard is empty!!
Hopefully to coincide with other news!!
Would have thought after Xmas though.
Richard Griffiths. I wonder why he sold a part of his holding. Could it be to fund his share in a placing? I have seen it done before.