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not a huge amount to buy just 9% freefloat. Gabriele Cerrone owns over 40% of the company and has history of M&A activity so knows what he is doing and benefits the most from a takeout of STEM be it a takeover or listing. The ATM shares end in July so once the new source of shares disappears and STEM announcement happens, the scramble to buy could be almighty here.
based on the proactive article about the wall street analyst, he reckons STEM is worth $280m so the way i see it Exact Sciences have about 4 months before the listing is complete in order to prevent a competitor taking a huge part of their market through a TO of stem or before it gets complicated having to buy a listed business. We know that STEM can be used next year in hospitals and has gone through a large trial from two european titans in their field so why would any oncologist specialist continuing using oncotype dx when STEM can give them a 50% better result. EXACT need to safeguard their position and $300m to do it is nothing to do that. Alternatively ROCHE could come and buy it straight from under their nose and add it to their breast cancer drugs portfolio so Roche can test and then sell the drugs to treat.
looking further into the competiton, Oncotype is the market leader but there is also mammaprint and endopredict that myriad diagnostics acquired from sividon for $56m in 2016 but looks like it has not gain any traction in the states. However, the competion seems fairly limited so with Stem far more accurate then a new market leader can be established. Not sure how easy it would be to displace oncotype but if the royal marsden and european centre for oncology have peer reviewed the test then that is a great start and a bit of traction in the states would soon turn into a snowball as surely oncologists would want the best as simply they can charge the most (oncotype is $4,000 per test). I am conservatively saying Stem is worth £50m as a listed entity but expect over the course of the listing process, several months, that it would be acquired by a third party. I am very pleased that Cerrone owns 40% of our business, he benefits the most and is well versed in takeovers and sales so knows what he is doing and what values to put on this. Roche are very active in breast cancer and their website is quite detaield on the risks of cancer returning. Roche and exact (to defend their position) are very strong suitors and to be frank there is no reason why they would not want to acquire stem, the rationale is too strong and their skillsets too great not to turn what could be a minimal say £300m outlay into a seriously valuable asset with very strong recurring revenues. TILS is a strong buy and once ATM has been cleared, and with such a low free float (one of the lowest i have every seen on AIM and just look at the sort of investors involved, some really strong outfits), regular news flow on all fronts and a very commercial, experienced CEO , when TILS moves it will move swiftly I think.
The magic really is that stem is not just a bit better but 40% better so if someone like roche can demonstrate that their product is really accurate and sell their breadth cancer blockbusters off the back of it alongside the 4000$ per test monies then they are laughing. I reckon it's worth 300m as lots of work needed to get it into commercial settings but for that company to then know after 2 years of running around they have an asset worth 10x what they paid.
Agree cloudy but 2-3bn right now just seems out of kilter so if it is merely a case of a big co buying the patent and then rolling it out then clearly it is worth mega money
Roche makes sense as they have two major drugs focussed on breast cancer ie what stem works on. Their cancer drugs are worth 16bn a year to 5hem so oncology is big for them. Obviously roche have been mentioned by cerrone!
I believe that genomic who owned oncotype had circa 1000 staff prior to exact taking control. For stem to get into hospitals ahead of oncotype will take some work but for a big 10 pharma who have those avenues that would be straightforward so one would expect exact to be eager to open the chequebook to protect their asset. I really cannot see stem being listed at all makes no sense
totally get that cloudy and we know that the trial it went through which proved its accuracy ahead of ASCO was done by some of the most well regarded oncologists in the industry so great validation. It is clearly not worth 2-3bn as it stands right now but given the accuracy it will be one day but how soon is that day as i want to know what is needed to turn it from a trial into a product. great that FDA approval is not needed.
great to see the ceo own circa 40% and the rest seem in pretty sophisticated hands so with such a small freefloat when atm ends and stem becomes clearer significant upside should ensue
yes cloudy but what steps are there to turn it into a business or product worth 2bn?
from my research it appears oncotype does not have and does not need FDA approval so what process does stemprinter need to go through to become commercial? this is important in determining whether stem will list at say £50m or £100m. i am amazed that exact would not pay say £300m for stemprinter as they could then deliver a better service (i think oncotype costs $4,000 a test) and given they are the 'entrenched' leader (gabrielle cerrone) it would b relatively straightforward to push stemprinter as an oncotype upgrade. keeps stem out of the hands of a competitor also who could in effect ruin the value in oncotype dx in fairly short order
he is merely setting out the issues for the webinar to focus on - namely time to get the product sorted are tight and the manufacture of these is an issue as the supply chain of product will need to be improved. AVCT is certainly not too late to the party - testing needed for a very long time.
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Given AS spent 12 months tempting Confider to invest, he is now looking somewhat silly in front of them by allowing this to happen. Realistically, if AS cannot deliver a LFT and get commercial orders, the pharma's belief in affimers will be shot. An update tomorrow needs to happen as this all stemmed from his end june comment last week.
this investment seems very odd. conifer have a small number of holdings all US domiciled yet now have picked a uk based minnow for a small (in there terms) investment. why do that unless you know something such as an imminent US listing/partnership/investment by a major/TO etc. given we as PI's are the last to find out what is happening, it is now fair to say that you should keep hold of your shares as this share has just hit the big time and big money is going to start moving very soon.
big Pr push coming up - 2 presentations tomorrow, 1 next week amongst an LFT update and TR1 of a large investor. looks like things are hotting up.
one would hope and expect that avacta/cytiva/zeus etc would have been pushing the doors open so that once we are approved we have contracts ready to go. the timing between approval and sales needs to be kept tight to keep up the stocks momentum. remember we still have news on OEM and other partners in the covid field.
https://www.bbc.co.uk/news/health-52995059
Thermal-imaging cameras and swab tests for coronavirus are not "clinically valuable" in airports, according to a panel of aviation health experts.
About one in every three infectious people would be missed, they say.
for those saying testing is no longer required just think of the ramifications. no politician in any country will risk a second lockdown and so to avoid the damage to the economy and frankly their political careers they will happily spend billions a year rigorously testing. with the mass optometry in hospitals, LFTs and possibly neutralising therapies, AVCT are well placed.
Amidst today’s goings on two vital bits of the puzzle have bene missed I think.
Firstly there is a concerted effort to utilise mass spectrometry machines for testing – see the below coalition. This suggest to me that the actual workings of the facility for testing is of no concern and so I expect this to land swiftly and be a very significant RNS.
https://b-s-h.org.uk/about-us/news/scientists-global-coalition-to-share-covid-19-mass-spectrometry-data/
Furthermore the ACE2 point within one of the more recent RNS with the indication that Az or GSK may be interested is again based on widely regarded science and so the rationale behind what AVCT are pursuing is very much game on.
https://www.wired.com/story/meet-ace2-the-enzyme-at-the-center-of-the-covid-19-mystery/
As a result I see two very positive RNS coming out of these in the near future.
With much time being spent on Medusa19 it would indicate that there is high hopes of a product to sell and the global connections of the Medusa team will be vital in hitting the ground running. For the likes of Genedrive it would appear they are starting with the idea of getting local distributors who would have their own connections. The benefit of Medusa is they can go straight to the highest political levels to galvanise action.
The UK’s test and trace debacle and the ongoing needs for testing and the global pandemic still in full throttle despite the view that the UK is past the worst – really reinforces that testing will have a place in the foreseeable and there is absolutely no indication that CV has gone/is going/mutating to be less aggressive
the adeptrix deal was announced on the 1st May so they have had 1 month to negotiate deals with the 4 major players in the Spectrometer sector. They have had the affimers since around 11th May when they were shipped.
cytiva have had the affimers for some weeks now and if the rumour of in hospital trials is correct then that is great news. if the LFT did not work i think we would have heard by now via an RNS but with Boris and now Trump extolling the virtues of 'pregnancy style' and revolutionary testing i think we can be confident that the LFT has worked but is now being tested to provide the data needed for CE and FDA approval. As has had 2 weeks to negotiate a deal on the neutralising affimers so not expecting a deal there just yet but on the others the lack of news is a major indication of significant milestones being reached. An update would be nice to arrest the drop from impatient investors but we are in safe hands with Avacta.