The next focusIR Investor Webinar takes places on 14th May with guest speakers from Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund. Please register here.
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.
https://www.investorschronicle.co.uk/ideas/2021/03/05/exploit-two-small-cap-pricing-anomalies/
for that ST article? Maybe you need to be logged in...
Simon Thompson wil probably write about this next week as he predicted this could happen in April
Daily Mail seems to be the only paper to have picked up on the value to Fipp of the Exscientia float. At closing SP the stake worth about £30m
hTTps://www.dailymail.co.uk/money/markets/article-10050501/MARKET-REPORT-Darktrace-sees-share-price-dented.html
"From admission, Frontier IP will be interested in 1,564,800 ADSs in Exscientia. Based on the initial public offering price of $22 per ADS, Frontier IP's holding is valued at $34.4 million."
https://www.londonstockexchange.com/news-article/FIPP/pricing-of-ipo-of-exscientia-in-the-united-states/15157339
Today's high $30.38 38% up on $22 Currently around $28.1
Exscientia up about 30% at around $29 currently.
That worth about £33m to Frontier.
So Frontier IP 1.5m shares are worth $34.4m at $22 per share
Looks like Exscientia is at $30 now, so Frontier's stake is worth $46.9m already (around £35)
So there is predictably plenty of demand for Exscientia with it being priced at the top end of the range valuing Fipp stake at $34.4m.
Talk when listing announced was of them raising $100m, that is now over $300m and in addition a couple of private placements at same price to raise a further $160m.
“Exscientia are expected to begin trading on the Nasdaq Global Select Market on 01 October 2021.”
I see Nanopore jumped 40% on there first day of trading yesterday. We could potentially see similar here today.
Looks like IPO is a go which means a significant tick up in FIPP value plus ease of selling relatively small stake should FIPP wish
https://www.nanalyze.com/2021/09/ai-powered-drug-discovery-stocks/
Four AI Drug Discovery Stocks
Company Name Ticker Market Cap
(USD billions)
Exscientia TBD TBD
AbCellera ABCL 5.67
Schrodinger SDGR 4.42
Recursion Pharmaceuticals RXRX 4.52
Founded in 2012, Oxford’s own Exscientia raised $374.4 million in disclosed funding from a slew of investors including names like Softbank, BlackRock, Celgene, Bristol Myers Squibb, and Sir William of Gates. All that money was used to build an AI-powered design platform known as Centaur Chemist which combines the power of machine learning with the knowledge of human chemists to discover drugs faster. As seen below, Exscientia reduces the time it takes to go from target to candidate by 70%.
Once there’s a drug candidate, it then needs to proceed through the FDA drug approval process like any other. That’s an easy value proposition to understand, but the accompanying business model is anything but.
If a software-as-a–service (SaaS) business model is to be rewarded for consistency and predictability, then a business model with unpredictable revenue streams should be penalized. While Exscientia’s revenues may appear to be starting out stable, there’s loads of volatility bubbling under the surface. There are two revenue streams – service fees and licensing fees – from which there can be four types of payments; upfront payments, research funding, milestone payments, and opt-in payments. Each relationship Exscientia has comes with its own terms. From collaborations to joint ventures, the business model quickly becomes so complex that it’s hard to fathom how anyone can keep track of what’s going on. So far, most of their revenues are coming from their relationship with Celgene.
During the periods ending December 31, 2019 and 2020, 69% and 83% of our revenue, respectively, related to the recognition of the Celgene up-front payments in line with our progress towards delivering up to three clinical candidate compounds.
Credit: Exscientia S-1 Filing
Then there’s the $4.6 million in revenues recorded for the first half of 2021 which consisted of 13% share ownership in a Chinese firm called GT Apeiron Therapeutics. While it’s counted as revenue, it sits on the balance sheet as an asset, albeit one that’s not likely to be very liquid.
While Exscientia has originated “the first three AI-designed precision drug candidates to enter human clinical trials,” their business model is far too complex for our liking. Complex business models = uncertain cash flows = stock price volatility. The same can be said for our next company.
the stake as per Singer note April was 2.27%, but has been diluted since, i'd work on ball park 2%.
Value? I'd start with a reasonable comp - Recursion RXRX US / $4.4bn....
“According to analyst Ian Jermin of Allenby Capital, which acts as a broker for Exscientia shareholder Frontier IP, the company could be worth as much as £1 billion in a float.”
That quote is from May 2019 and the talk was of a float in mid 2020. Are they worth more now?
At £1b Frontier stake would be worth £24m. Frontier current mkt cap £53m.
Oxford Nanopore are apparently targeting a valuation of £4bn up from £2.4bn in May according GEN the online Genetic Engineering & Biotechnology News, I am sure that the investors in the last 18 months will be looking for a similar increase in valuation. I also believe that Exscientia is viewed as a more 'next generation' model and should command a premium and on FIPP's website they still hold 2.4% DYOR Sometimes
Does anyone have any idea of Frontier's stake in Excientia (I've heard/read around 1%)?
And I have seen they are proposing an IPO to raise up to $100m, so any takers for the proposed IPO valuation for Excientia?
If they were raising the full $100, and say they only sold 10% of shares, which would be a small amount, this would "only" be a $1bn valuation. So Frontier would have a $10m stake, which could grow. That said, I feel a much greater valuation should be achievable given the partnerships Exscientia has in place, but they this would mean selling an even smaller percentage of shares. If anyone has any insight this would be greatly appreciated.
Portfolio news - Registration statement filed for proposed initial public offering of Exscientia in the United States
Frontier IP, a specialist in commercialising intellectual property, notes a registration statement on Form F-1 (the "Registration Statement") has been filed for portfolio company Exscientia Limited with the U.S. Securities and Exchange Commission (the "SEC") relating to a proposed initial public offering of Exscientia (the "IPO") in the United States of its Share Securities ("Share Securities").
The Registration Statement relating to the Share Securities has been filed with the SEC but has not yet become effective. The Registration Statement can be accessed at the following link: https://www.sec.gov/Archives/edgar/data/1865408/000110465921114491/tm2119783-5_f1.htm
At this stage there can be no certainty on the IPO proceeding nor the terms or timing of the IPO.
Further announcements will be made by Frontier IP at the appropriate time.
Bought in at 103, who knows if there will be lower prices to come. But revenue and profit growth, an improving operating margin combined with a lowish PE of 10.5 suggest an underpricing to me. Yet to become well versed in the industry, look forward to picking up more from experienced posters here over time.
There has been a lot of interest in this lately. I think many, as management have already stated are expecting a substantial uplift in NAV. Exscientia alone could quite possibly add tens of millions to the NAV.
Simon Thompson in the IC today.
Zak Mir charts ...target 110
https://www.**********.co.uk/articles/traders-cafe-with-zak-mir-bulletin-board-heroes-may-28-47215de/
What’s sparked the interest today?
Is it chart related TA or has it been tipped somewhere?
Brought a small amount more based on latest RNS
Nice to see an IP company with investment even if FIPP only own small stake getting such big deals sign up by major pharma companies and SoftBank (albeit SoftBank has funded a few dogs such as WeWework). I
Portfolio news - Exscientia announces multi-target, AI-driven drug discovery collaboration with Bristol Myers Squibb
Frontier IP, a specialist in commercialising intellectual property, notes the following statement from portfolio company Exscientia Limited ("Exscientia" or the "Company") announcing that it has entered into a collaboration agreement with Bristol Myers Squibb.
Exscientia statement begins:
Exscientia announces multi-target, AI-driven drug discovery collaboration with Bristol Myers Squibb
Upfront and potential milestones of over $1.2bn in addition to tiered royalties
Exscientia, the clinical stage, Artificial Intelligence (AI)-driven pharmatech company, announced today that it has entered into a collaboration agreement with Bristol-Myers Squibb Company (NYSE: BMY). This expanded collaboration has the potential to add to the Bristol Myers Squibb drug pipeline whilst enhancing Exscientia's portfolio of shared assets. The collaboration will use AI to accelerate the discovery of small molecule therapeutic drug candidates in multiple therapeutic areas, including oncology & immunology. The agreement includes up to $50 million in upfront funding, up to $125 million in near to mid-term potential milestones, and additional clinical, regulatory and commercial payments that take the potential value of the deal beyond $1.2 billion. Exscientia will also receive tiered royalties on net sales of any marketed drug products resulting from the collaboration.
This expanded collaboration builds upon Exscientia's existing collaboration with Bristol Myers Squibb that was initiated in 2019 with Celgene prior to Celgene's acquisition by Bristol Myers Squibb. Exscientia will take responsibility for AI-design and experimental work necessary to discover drug candidates associated with this collaboration for Bristol Myers Squibb. Molecules will be designed using Exscientia's AI-driven drug discovery platform, which delivers optimized compounds fulfilling complex design goals faster and more effectively than traditional drug discovery.
Andrew Hopkins, CEO of Exscientia, commented, "We are proud that Bristol Myers Squibb wants to build on our work together with this expanded collaboration and believe it speaks to the strength and promise of Exscientia's AI technologies and drug discovery expertise. We're excited to work with such an experienced collaborator as Bristol Myers Squibb to develop the best possible medicines for patients."
Rupert Vessey, President of Research & Early Development at Bristol Myers Squibb said, "We have been pleased with Exscientia's work in tackling a number of distinct projects for Bristol Myers Squibb. Exscientia's application of AI technologies is proving capable of generating best-in-class molecules while also reducing discovery times. Rapid discovery of molecules that can enter the clinic in a timely manner could positively impact our work in discovering treatments for areas
With all the noise on Tern it’s perhaps to be expected investors will be looking at other companies that focus on taking stakes in companies and their IP. Still expect FIPP to be re-rated soon.