Chris Heminway, Exec-Chair at Time To ACT, explains why now is the right time for the Group to IPO. Watch the video here.
First, it strikes one as odd that the same management that proved itself so savvy at boosting Avacta's valuation on the back of an LFT that was very unlikely to become a commercial success now clumsily seems to hurt the valuation with every decision taken.
So, there is a possibility that their latest actions were deliberate and intended to foster a certain outcome.
One must remember that PRECISION is just a showpiece of the Affimer technology.
They have to and want to prove the ability of this novel peptide-platform to achieve things that are not possible with current antibody conjugations. Avacta is, of course, unable to develop this platform to its full potential on its own, as this will take decades and billions in R&D spending. So, we have to put up with a phenomenal proof of concept to transition the IP at the highest profit to a company that has the capabilities to carry this immense undertaking.
Bachovin, Tufts Medical School, and Avacta own the patents behind PRECISION. I don't know the details of this shared ownership. So, it was never about making a big buck on this alone. PRECISION is a proof of concept, and then the journey will continue from there on under different ownership. The greatest danger to this lies in the possibility of being taken down just before that marvelous piece de resistance shines.
PIs have no idea how to put value on Avacta adequately. Whoever thinks this is about PRECISION, you now know you have no clue how to guess a price for Avacta. On the other hand, there are the IIs who can at least guess an adequate price range for such a behemoth of IP.
For AS and other board members, this is a matter of building generational wealth, so they have to shake off those PIs, who think 3 pounds per share is a killing.
I see this series of actions in quick succession built to reduce the number of shares in the hands of people, not able to guess the value in the slightest.
Should this hold true, it makes for interesting times ahead and I have to thank the management later on, but hey we have a shared interest, so that lets me sleep well at night.
The answer to your rhetorical question might be pretty straightforward:
Management intends just that.
The shareholders and the free float are serious obstacles to achieving the best result in a takeover for the Board.
If management wanted to prepare their part the best they could, taking every action to reduce the free float seems reasonable.
It seems almost like management wants to kill off any PI interest and make them sell their holdings, which are then gobbled up by II. The new emissions issued at a discount? They went mainly to the largest IIs on board already. The convertible bond issued to Conifer is a great tool to reduce the free float. Now, today's move. It looks almost as if management is exerting themselves to change the shareholder structure as fast as possible. Considering that, I get the feeling many of the omnipresent, highly active, bearish opinion makers might be on the payroll of the brokerage that devised that plan. No one in his right mind would have spent that time and energy shaping a negative outlook in PI spheres to a particular stock as the usual suspects have, especially considering that management is working hand in hand with them...
Have you ever wondered why Myles stopped promoting PI investing in AVCT? A possible explanation is that he sees that now as beneficial to the future value of his holding.
Quite a sight seeing all the suckers falling for this charade.
Avacta‘s stock price is actually a quite interesting detour into the computational inability of the market to adequately assign a correct value to the stock. The lemmings and their short term sentiments distort this calculation and within a frame work, which biases the educated investors not to take any risks (which Big Pharma could take on more economically on their own, no need for them to buy out anything but the proven product), we have a formula for systematical undervalution. I will look for this pattern in the future in different opportunities again, rinse and repeat.
It is quite obvious to me, that the stock price will be forseebly not driven by substantial news in the short term.
I think, P1a will be a drawn out and delicate affair:
so far, the data presented does not provide substantial insight into a dose dependent toxicity and the study design is intrinsically somewhat problematic.
This is great news on the one hand, but doesn‘t provide a great and linear narrative, with which to draw in private investors.
There is a high probability, even the current dose escalation will not show a clear safety signal and the dose will have to be increased further. Such increment will be thoroughly scrutinized by the authorities and will become ever more difficult to justify.
Then, there is an inherent flaw in the patient‘s cohort, they are all terminally ill with a very high tumour burden, which could obfuscate toxicity encountered in patients with less tumour mass and thus less localized FAP. From an honest medical perspective, the current study design does not allow to generalize toxicity regarding patients with varying tumour subtype and tumour burden. The study will probably have to be expanded greatly and with serious delay. I do not think, this will impede Phase 1b, but I expect an expanded 1a in parallel to 1b by the beginning of next year. This is great from a medical point of view and will add tremendously to the established value of AVA6000. Nonetheless, this will fuel the ongoing process, that weighs unfavourably on the stock price: there is a steady transfer of stock from the pockets of short term AIM goldrushers, who do not nor want to understand the science, into the pockets of patient informed investors. The short term holders will gradually fade, while the stock price being traded down. This highly increases the probability of a silent and discrete takeover, which will hit suddenly, when interested parties get a hold of the safety signal or lack of in the current or even next dose escalation. For the time being, the power of a statistical analysis of the so far known 1a data is too low to draw solid conclusions, when the data is sufficiently expanded to increase the power to a reasonable level, this will trigger the buyout. One can try to model that point in data accumaltion oneself, I have not done it. By gut feeling, I think this will be achieved after two more escalation courses (including the current).
It‘s a phantastical wager, which depends mostly on developments, which are hidden from the public. No revenue without risk or effort. Otherwise it would be impossible to make a financial gain. Each critic and detractor is a blessing in disguise, as the problems he elucidates and (over-)weighs increases the amount of possible gains on the scale‘s other arm.
Interesting times to be invested!
One should not forget another speedbump 1b will receive: ethical concern. After the first readout, when true placebos are put against an equal number of verum treated patients, the difference in preliminary endpoints could already be so striking, that for ethical concerns the placebo arm will have to be dropped. Think big at halftime, 1b could be practically over at halftime.
It get‘s even better than that. PRECISION does not even have to provide better outcomes. Even with identical effects at better tolerablility it will win the market by default. No need to get fixated on outcome improvements, thouh they are to be expected.
Can you really consider it a pump, when he makes it clear his exit point is a to be expected takeover bid?
I understand this as „hold“.
Lol, rather consider 40 quid
The very idea of technical analysis is s moronic form
of magical thinking.
Given one could predict even partly the future development of the stock price, this very knowledge would be acted upon by certain market participants and such influence the stock price itself in a chaotic manner, invalidating any technical prediction.
Then next to theoretical implausibility, where is empirical proof for technical analysis?
In the end, it doesn't really matter.
We are not looking at a value driven stock, whose spot price is determined by any business fundamentals.
As any upcoming biotech, this is a binary bet. Either they prove the value of their technology or they don't. The whole Covid19-antigen-test conundrum was an immense strike of luck, providing the company with the momentum to gobble up venture capital on the cheap.
At no point in time, anyone was allowed to assume, a small biotech research vehicle would be able to put a high revenue generating LFT based on a novel platform to the market. This possibility solemnly fell into the responsibility of a 3rd party partner, first envisioned in Cytiva, then in Medusa19. Obviously Cytiva did not want to bear the risk (rightly so with hindsight) and the Medusa19-crowd failed bitterly.
Then some vultures smelled the rot and brought the stock price down from the highs achieved on the back of PI sentiment to the price of your ordinary lottery ticket.
Nonetheless the fundamental bet is still open and the chances have never been better. If precision proves it value in a peer reviewed manner, your 45 pence ticket won the lottery big time. The price then will not be decided on the AIM, but among the bidders for a potentially disruptive technology.
One should not dismiss off hand an elegant plan behind all of this. Someone with inside knowledge could easily steer the way of the stock price coming up to the big revelation. I wouldn't be too surprised, if the Boohoo crowd ends up with a lot more than their allotted share before April 2022.
Till that culmination point is reached, nothing will move the stock price fundamentally. There will most probably be no LFT generating relevant royalties or other value building happenings.
This stock is a ticket in the waiting for the day of the big drawing. A drawing, that could easily scratch at the 10 billion pounds mark.
Haha, look at those muppets put on their last dance. But at least they show their true colors now. I hope Blackrock will have it‘s fun with your boss!
What is your point exactly?
You state to own shares of Avacta and to be determined to hold. So you expect the stock price to rise in the future or at least keep it's value corrected for inflation and to do this on a time scale suitable to your investment horizon.
So after all, if you're bent on holding, you must expect this to happen.
It should have always been clear, even to the most naive investor, that a biotech company in it's infancy and absorbed by research does not possess the means and the know-how to produce, distribute and properly market a high volume product. From the moment on, the deal with Medusa19 transpired and Danaher moved out of the picture, it became clear, that this is the place to look for the commercial application. For reasons unknown, Medusa19 - being a new venture itself - is straggling to put the test to market. Maybe they wanted to see a small scale production run and distribution trial of the test before investing into a large scale production setup.
The ball lies now in their court. As lies your decision to hold.
@MonEGalor
You are either willingly or unwillingly spreading misinformation.
Sensitivity describes the term: Number of positive test results / number of sick individuals tested (i.e. test-positive, who got the disease + test-negative, who got the disease).
Thus the higher the sensitivity, the more likely the test is to correctly identify sick persons taking it.
Specifity describes the test's ability to correctly identify healthy individuals.
To say it with the State of New York's Departement of Health:
>>A highly sensitive test means that there are few false negative results, and thus fewer cases of disease are missed. <<
With a sensitivity of 60 % you miss 4 out of 10 diseased and release them to spread the disease, which probably explains partly why the situation got out of hand. Whether this is any relevant at the current epidemiological meltdown is another matter. Probably the disease cannot be contained anymore and will spread through the entire population until next summer. Considering Covid19's ability to re-infect and spread by the vaccinated or previously infected, the need for testing will not disappear in the foreseeable future.
Avacta and Medusa19 are quite right to expect a continuous stream of revenues well into the mid 2020s, if not further.
Are those expenditures for testing tax-deducible in Britain?
Dear Ophidian,
I did not claim there to be specific risiks, those
claims were raised in posts, you are - understandably - not able to see.
To repeat myself: What evidence is there for any specific risk?
As far as I know none. The upcoming clinical trials will help to elucidate the presence of unexpected risks, but so far there is no specific risk to be expected. Otherwise they would be addressed in form of specific secondary endpoints in the study design. Unless we will find them there, the study designers and the approving authorities did not consider them to be expected.
Of course there is no guarantee for nothing in the medical field, but so far no specific risks endangering the clinical success have surfaced.
Your abuses aside, there is neither evidence nor a rationale to assume FAP upregulated in tumour patients outside of the tumour microenvironment.
As to why Big Pharma usually doesn't acquire preclinical platforms is the fact it doesn't make sense for them to shoulder all the risks: if they wanted to, they could do such research in-house. On the other hand over the life cycle of a pharmaceutical IP some billions to acquire don't matter in the big picture. It's simple risk management to pay some billions for a safe profit of more billions in future sales, rather than risk hundreds of millions on an uncertain future.
The tricky points will emerge later on:
How much dose escalation is possible and is even wanted?
If you kill off tumour cells too fast you will convey into medical oncology all the problems haematologists struggle with in tumour-lysis-syndrome usually encountered in the treatment of leukemias and lymphomas (which respond often tremendously well to current therapeutic regimes) like clotting the kidneys with tumour debris and so on.
On the other hand of course the tumour and it's micro-environment will attempt to adapt to this therapy and clones scarecly or not at all expressing FAP in their environment will thrive. So maybe a special course alternating FAP-targeting and conventional chemo-therapy is needed to avert tumour-evasion.
Then there are cases known, in which tumour-entities are known to appear in different kind, either expressing FAP or not, for example this was shown for a common highly malign brain tumour called Glioblastoma multiforme. So there is the need to identify biomarkers predicting which patient harbours a tumour susceptible to this specific therapy (and most of them are as we already know).
It is a long way before this therapy can be routinely administered, but if the results of the animal study only somewhat translate into the clinical situation, medical oncology will see the next revolution after the introduction of checkpoint-inhibitors and chimeric-T-cell-therapies. This has the potential to be humungous in relevance for patients and in terms of revenue.
Well on serious wound healing and ongoing inflammations, especially those of infectious origin, those are a contra-indication to the start of any chemo-therapy anyhow.
As I said, at the moment there is no obvious or foreseeable flaw in the concept targeting FAP. It has been in the focus for quite some time now and the failure in translation as of now lies in the technicalities of proper targeting. Avacta seems to have overcome those hurdles as proven in their rodent study. Chances are very high this will translate exactly into man, and one can rest assured, all obvious points of contention regarding safety will have been thoroughly scrutinised by the regulating authorities. No patient will be dosed with something, a prolific reader and writer on an internet bulletin board can raise serious concerns about.
@Ndn71
The expression of FAP in adult human tissues is virtually absent, see
Pleshkan VV, Alekseenko IV, Tyulkina DV, et al. Fibroblast activa- tion protein (FAP) as a possible target of an antitumor strategy. Mol Genet Microbiol Virol. 2016;31(3):125–134.
As a highly conserved mammalian signalling pathway the preceding animal studies should hold true, unless a hitherto unknown effect comes into play. Hence the further clinical studies. As of now, there is no reason to suppose a significant expression of FAP in healthy adult human tissues.