London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
"My interpretation is CT came on board because he thought it would be a slam dunk"
Maybe if Tovey was an AIM investor he would have been that reckless but as an incoming very experienced COO I am 100% sure he did his due diligence and would have understood the dual issues of M3 reformulation and the need for a new trial design for Nasal before arrival, and indeed been questioned by the BOD extensively about his approach to both issues before being appointed. That is how it works in the real world. Whether he forseaw the precise situation they are in now is another matter.
HarChris I think you're looking through rose tinted spectacles here. My interpretation is CT came on board because he thought it would be a slam dunk bearing in mind the great possibilities, unfortunately in the UK money is in short supply for bio's. Doesn't look like that deal is forthcoming. A few were slamming me for selling out at just over 30p, time proves I was right the same as JW who sold at 60p.
Where the company goes now nobody knows but one thing is for sure CT and Sir Nigel won't be out of pocket.
The danger is that the company will end up so diluted it would take years to get back to the price they could achieve now for a sale, and that is assuming all goes well in trials, China does not invade Taiwan, etc. Hard to know how enthusiastic investors would be without big pharma doing at least a majority share of the lifting. Yet any kind of formal agreement is probably months away at best, all in all a bit Catch-22.
The make up of the board is the key differentiator here and something the market is simply overlooking imo.
Of course it doesn’t guarantee that DEST won’t end up in the same mess as other cash-hungry small cap biotechs but the combination of having Chris and Nigel here and the NPV of XF-73 alone gives me confidence that they’ll be something better on the table than a heavily dilutive placing to fund the p3 trial.
Surely we should have faith in Chris Tovey. Look what he did for GW. He would not have come on board without the same expectations and he was very enthusiastic at the time. Can he just walk away if he wants to?
The uncertainty could drag on for weeks, it really is amateur hour here. Faintly possible they had some kind of financing basically in place before the shambles of an AGM. A sale of the co is probably the least bad option now imo, but to progress Nasal some kind of deal that includes marketing by a major is essential, financing it all themselves then hoping for the best is not an option.
It’s been doing this for days. Buying continuing but almost every time the offer drops on each buys (unless there’s bigger volume in a short space of time).
Normally means a large seller in the background which is what I think is happening here.
I still hold but I’m watching the trades to see what’s happening as it looks like it’s heading back to 10p on the bid.
Great news this morning, but not what we need. Starting to feel like a coin-toss between placing and deal (maybe a hybrid, let’s see).
Agreed. They have injected massive uncertainty into this in a totally amateur way. This is a good RNS - but insufficient to clear the uncertainty. So we have to wait for a bounce ( hopefully! )
IMO
The XF platform does look extremely promising so I remain hopeful.
I suspect there won't be too much movement price-wise though until we've heard back from the company re the strategic review of options which was signalled for the next week or so.
Surely this is a turning point? 10p is massively squeezed from where it was a year ago and imo that’s a great RNS
The MCap might not be so heavily depressed following this morning’s excellent and encouraging RNS. We may have reached the bottom at 10p and the recovery should be on from here.
It’s not hard to work out what they need for the P3 trial and for general working capital purposes. Essentially very modest sums we’re talking for what it is but significant against the incredibly depressed market cap.
How much cash would they need to raise if they did do a placing, ball park? I don’t think they’ve said, but knowing this would give us some perspective.
Pretty certain that selling the co is one option they will be looking at, I doubt any kind of large placing is possible amongst the uncertainty they have created. In the review announcement they said not currently in talks re a takeover, in itself a hint.
So what we would be an achievable price? 25-30p max at a guess given the value of the Sebela deal. A RENX style maintenance placing if required to give them time to sell should be possible, as should raising enough cash for a further 12 months and cutting costs and refocusing. Given the current val of about 6mill plus cash an offer or 'in talks' statement is possible anyday, but probably best to stay on the sidelines for now.
For whatever reason that presentation was not aimed at promoting the SP, possibly so they could present an offer as a good deal, possibly for some other reason.
Mind you selling a 100million packets OTC for $2 profit a time to worried people in Japan vs a few thousand prescription cases at $1500 dollars each, you begin to see the power of prohylactics.
Perhaps just possibly in the long term as a prophylactic, never as a treatment for the full blown condition.
Is this something the XF platform could help with?
https://www.telegraph.co.uk/global-health/science-and-disease/flesh-eating-bacteria-streptococcal-toxic-shock-syndrome/
POLX is a primarily a medical device startup is it not? Those are rarely good investments ime. I don't follow it but looked at it briefly a while back and dismissed it for that reason. Also US Co's listing in the UK is usually a red flag by itself .
The obvious medical device comparison for Dest is not POLX but Ondine (a Canadian co listing on the AIM is also a red flag imo), despite this and a poor record they have had no problem raising cash recently and on an ongoing basis on the back of their story, which is in the same space as but rather less compelling than Dest's imo.
They have started that no one is interested and they are at the beginning of going back to potential partners with he new P3 costing. I think that is a smoke screen, they know they wont get 100% external funding for P3 and IMO they have already made their mind up to raise funds which was obvious with the awkward response to the direct question about it.
The presentation was poor and did not look like something intended to drum up interest in a fund raising imo, they can do much better than that, for example very little was said about M3 which is curious in itself. Plus if Ondine can raise cash with little fuss Dest can, especially with their board. Finally the SP fell on relatively minor volume so there will only be limited stock at these levels.
Personally, I see a deal coming with an upfront payment, and further staged payments at key milestones. I think you are forgetting the huge potential and future revenues of this treatment. Any indication of a deal and this share price will rocket.
Have to agree with Bantham an equity raise looks likely, and even if not, the impact on the share price will not be positive in the short term.
Look at POLX to see how not to handle a placing, and they have an excellent product that is FDA approved.
That share was 75p on FDA approval day but dropped to 50p on future funding concerns. BOD did a presentation to 'settle' the market and it dropped another 20% instead.
Despite having a couple of heavily invested strategic partners the share kept drifting down to c5p and eventually the placing was done at 1p.
Unbelievable you'd think, but unfortunately not.
I do think a deal is within reach....... Several factors have made a deal much more appealing to potential partners:
"Destiny’s CMO detailed the revised clinical program for XF-73 Nasal and what struck us most was the expected £25m cost. This was the average estimate from six or seven contract clinical research organisations. To most potential licensors of XF-73 Nasal, this level of cost (and any upfront payments) would be a ‘steal’ for a license that gets them to the other side of Phase 3, the rights to XF-73 Nasal in some jurisdictions, and a pathway to a regulatory submission."
"Destiny’s CMO then summarised the revised Phase 3 clinical program which, besides being highly cost-effective, also achieves the same objectives of the former and larger program. It is likely that the previous program’s cost caused some potential licensees to hesitate."
"Furthermore, the UK government and GSK recently announced the Flemming Initiative to tackle antimicrobial resistance (AMR) with these first two founding partners committing £130m. This type of new initiative may help to spur on potential partners for XF-73 Nasal as they review the revised clinical plan and costings."
Destiny’s award of an IPD by the UK’s regulator the MHRA is an important endorsement. This highlights the acceptance of XF-73 Nasal’s potential to address the unmet clinical need of staphylococcal post-operative surgical infections where the tempo of treatment failures due to antimicrobial resistance has been rising. Moreover, the current standard of care (mupirocin) is either not approved for this indication in the US or is typically reserved only for MRSA outbreak management in regions outside of the US.
Thanks Sorceror
I listened again to that again a couple of times. I am afraid in what he said he left the door open to an equity issue. I have no idea whether he meant to or not. If he meant to close off that option it was an incredibly ham-fisted response and just one more shot in the foot from these guys. If there is one thing they should have been clear about it’s that an equity issue was not on the table in this review period - if that was the case. And they did not do that - whatever Equity Development says. So no-one will buy material equity at this price and the price will languish until they clarify things. So annoying.
IMO DYOR