Member Info for Jatw

Today’s pipeline news is for a product barely listed in the corporate presentations. It is there as a new IND, but not in the clinical progress charts.
The discovery team seem to be working hard building the pipeline…let’s hope the clinical study teams and regulatory teams are on top of all the programmes and there is a strong value assessment to progress the commercial pipeline. It seems we may see more deals like Inmagene if Hutchmed does not have the capacity or resources to pursue what it discovers.

A pity they (GA)did not take up their warrants. However 100m will be 3-4 months of investment expenditure soon and so will make little difference to Hutchmed plans as they have 2-3 years of cash burn aid funding..getting Surufatinib approved in the US and EU is critical to getting product cash flow moving.
We should know about approval by end April and I expect the company to announce its distributor in Europe around the same time. I expect they will go with a royalty scheme, but they could seek an upfront payment to incentivise the partner to sell and develop the product.
If the other therapies come through this company will look v different by 2024/5.

And Imfinzi.
The improvements they are reporting for liver and biliary tract cancers are strong and should set them up for increased revenue streams.
The trouble is when you are worth 135bn GBP it takes a lot to move the dial.

Sounds like a plan for Elliott. In which case the sp will gradually rise towards 925 (stopping a little short for the time lag to settlement). Elliott will need to announce its acceptance a few days ahead of the voting then the deal will be in the bag but they may hope to create a little uncertainty to pick up more in the market before announcing.

So PK do you think Elliott is maximising returns on 925…..and will accept?
Buying as much as it can with a known 1-2% gain…..which is much better than cash returns.

Crazy cheap……
Heading for a PE of less than 5.
A rerating to 7.5 is a 50% uplift……will we see that and a sp of 135p?

Some might see this as an opportunity to make 20p 2.5% relatively risk free if the deal is accepted.
There is no certainty of this and if the deal is voted down then there is a downside of 10-15% to accept.
Some still see a full value between 10 and 11 pounds…..if you are one of them there is potential upside of 10-20% from here……but you might need to wait a few years to see it.

My initial Clin holding came about by buying quantum when the initial approach was made the final offer was 25% higher from memory - but those shares are still underwater by about a pound after this bid……

Place your bets according to your level of risk and ability to act quickly when conditions change.

As an existing holder I am going to hold. I don’t think I will be adding.
If I held zero I would not buy now, but I would be tempted if the price falls on rejection of the bid. I am generally a buy and hold investor rather than a trader so I take a long view and am happy to ride out the peaks and troughs of the market.

I don’t understand why they have not been advertising their DB sales, a lack of news has led to them languishing in the 70-80s.
This update was truly excellent. I expect a strong run up to the results on 10 March and then we will see about a dividend…..personally I would like to see a clearer position, and I don’t want / need a dividend if it means they can deploy the cash with a 15-20% ROE.

Plenty more pain to come from evergrande.
Today’s AUM values will be showing some of the effect of written down valuations and exits fearing future write downs.
This plc is effectively controlled by the CEO. At what point does he want an exit? If he holds out too long he may only have a small fortune left.

Improved offer highlights that the committed shares are still low and nowhere near the 75% needed.
They had to raise the bid otherwise it would have been voted down. Extra 3 weeks allow Elliot and others to see if they can find another buyer to breakup the business and offer a higher price. If not will they back the 925 bid.

925 is an improvement of 4.8% and matches the recent market price highs….so everyone can make a profit….but it is the least triton could do.
They reserve the right to raise the bid in the event of another offer emerging.
Increasingly it looks like it is down to Elliott and a few others to determine what happens.

I suspect this bid will be accepted.
Well done to those who sold last week…..the timing of this announcement has been poor/cynical for those who decided to sell over the weekend and placed orders, I suspect the MM have marked down the sp to catch those unsuspecting shareholders and pocket the increased offer….

Davey, it is hard to watch the sp on a daily basis as there is extreme volatility in the US. It is less pronounced in HK and HCM has lower volatility than other China pharma that have us listings.
It is generally outperforming Beigene, Junshi, innovent.
The whole Nasdaq has entered correction territory……
The pipeline progress is excellent. Two candidates with Breakthrough therapy designation. 10+ registration studies in progress, improved performance in combination therapies….it does look good for the future.
I feel this current pullback is a buying opportunity as it is about markets rather than the individual stocks…..that is not to say the markets won’t go lower, but in 3-5 years this company will be very different and hopefully worth double today’s value.
I know we could look back and say that was not the case over the last few years but that was a very different time. Then there was expectation of Savo being highly valued and imminently launched, AZ has not pressed as hard as it might., now savo is only around 20% of market value with a much more diverse and more reliable set of candidates driving the s value in future.
I think this is a less risky company than most early stage discovery companies and will be sticking with them.

See today’s news that highlights many reasons asos has to leave aim.

Exactly why HCM should leave too (as long as they retain a UK listing).

Looks like the option has lapsed.
Not critical for HCM, although an extra 100m in the bank would be useful.
GA lost a lot of money on Greensill s maybe they don’t have the cash, or just see China biopharma as on a losing streak at the moment.
This is going to be a good year for HCM pipeline wise and commercially, whether the market revalues the company we will have to wait and see.

Excellent pipeline news should cut the time to market by 6-12m.
The Eslim-01 trial started in October treats pts for 24 weeks which means they should wrap up the trial in 2022. Regulatory review could be done by late 2023.

Today’s trading update is unexpected given the meeting next week.
It does not say trading is poor take he deal…..it does provide cover for an improved offer.

Over to triton…..market still expects more.

No movement from triton….and the price is still well above the bid.
Squeaky bum time as SAF would say.

There is a markedly different tone to today’s RNS.
However management need to execute well for some time (18-24m) before they will be fully trusted….
One thing we have learned is that they know when to deal their stakes….follow the directors when they buy and sell..

https://uk.finance.yahoo.com/news/epizyme-provides-business-highlights-preliminary-120000748.html
Epizyme sp continues to weaken, it is down 80% in the last year to around $2.50.
Tazverik sales are building, bur their cash will last until q4 2022 so they will need new funding….either from a dilutive equity raise, or a strategic investor or being taken over.
Hutchmed is well placed to assess the commercial value of tazverik…..however a takeover offer would mean their full program would be a significant cash drain that would need HCM to raise further funds…..so I don’t see that happening, but they could leverage their current deal to gain more control over tazverik or other assets.
I certainly would not invest in epizyme until their funding situation is resolved…currently very high risk but a potential M&A target. .if they can raise 2years of development funding, then they become investable….if they can’t they are a sitting duck waiting for insolvency or lowball takeover.

New China distribution arrangement RNS.
Saarland Group plc is listed on aim under ticker SMK Mcap 80m
Office in Merton, London
Business description from HL.

Samarkand Group plc is a United Kingdom-based company that enables its wholly owned and third-party consumer brands to access Chinese consumers through cross-border electronic commerce. The Company serves brands from the health and beauty sectors. Its software platform, the Nomad platform, provides a direct-to-consumer route to the electronic commerce market. The Company's platform offers five technology and service solutions: Nomad Checkout, Nomad Storefront, Nomad Commerce, Nomad Analytics and Nomad Distribution. Nomad Checkout is a software as a service (SaaS) based solution that integrates with electronic commerce software providers. Nomad Storefront supports the operation of electronic commerce stores on Chinese platforms. Nomad Commerce offers customizable electronic commerce solution. The Company's platform is integrated with electronic commerce and social media platforms, as well as payment, logistics and customs systems.