focusIR May 2024 Investor Webinar: Blue Whale, Kavango, Taseko Mines & CQS Natural Resources. Catch up with the webinar here.
In general and across sectors it is better if there is a fall in the price leading up to the announcement of major news ... always within reason and as long as movements happen above the long term average. If we go much below 145p today and for some time then ... it's more difficult to attribute the fall only to stop losses and look for the persistent seller / global crash/ other reasons.
And a a couple more points:
- this share has risen from high 30s, 40s and 50s to almost 180p yesterday. There is bound to be turbulence, corrections, profit taking and MM interventions (lacking a better word).
- 4D is mainly a long term investment not least because of the sector. It became a short term one AS WELL because of the fire sales by the funds in late spring/early summer. That was precisely when the company was close to start reaping the harvest of many years of efforts. And... it seems to be only the exciting start.
And by the way, it's not necessarily the last day before the results.
agree but best if you download the barc app and then access smartinvestor (rather a misnomer) through your mobile
From memory we were told by the CEO during the recent interview that IBS results could be announced early in October / q4.
In any case, it was in answering the question about price catalysts in the rest of 2020 so we can afford to be a little optimistic.
IBS seems almost like a stepping stone off which we can aim for the (possible) major next stage project successes in oncology and, ultimately, neurodegeneration. The scale and importance of Part B oncology trial means 4d is not willing to leave anything to chance. Such hiring makes perfect sense on different fronts not least showing to the market and the sector that we mean business.
Re the various fronts oncology, IBS, neurodegeneration, asthma/flu/covid and ... funding:
(i) Oncology: resuts far exceeded expectation especially given that the patients had tried a number of treatments with little or no results.
(NB let's take the minimum probability of 10% that would be considered a success. The chances that we would see positive results in 5 out of 12 ... with the hypothetical prob of success at 10% is very minimal. In other words probability of success must exceed by far the minimum threshold of 10%. Further patient recruitment to be completed by summer 2021)
(ii) IBS: what's the point of highlighting its safety (vs competition / other existing ones which side effects) if it doesn't work well on the efficacy front and especially when he is aware of the close-to-final results? Release of news could slip into early October. Last not least: IBS was mentioned in answering the question about catalysts in 2020 ... well, if that's not a hint then what is?
(iii) Covid/Asthma/Flu: Same therapy covers three illnesses with similar symptoms. So any delay in covid recruitment means focus can switch to asthma. Again addressing inflammation was emphasised.
(iv) Neurodegeneration: they have seen some indication of repair of neurons (!) and it's past the development stage so clinical product ready. NB. watch this space then in the next few months/years!
(v) Vaccine project with Merck: bit vague there "we'll see how this progresses in the future" so must be still at a relatively early stage.
(vi) Funding: Merck was mentioned as a contributor of capital but was that in connection with the past or the near future or if certain conditions are met? Some of capital injection to be seen from US investors mainly. That bodes well for valuation increases as valuations in the US are on a different scale to Europe.
Would they have left the IBS rns for the last ten days of Q3 if it was a failure, even a borderline one? One could be forgiven for expecting anything in the range of mild to significant success, overall, with nuances here and there.
The results are very good and indeed the company has been transformed compared to where it was. But now it has the firepower to do soul searching in order to diversify. Into other areas where it makes sense to focus. From H1 next year sales may start levelling off due to competition and ultimately start falling. Diversification is one way street.
Even before details of commercialisation the value in the company should begin to be unlocked. in a major way, with successful IBS results (especially if success is unequivocal):
- it will be the first successful phase II for the company and one of few for the LBP market as a whole,
- puts firmly the whole company and not just the Blautix therapy on the pharma/biotech/lbp sector map and bodes well for what's to come out of the whole platform;
- whereas offers for cooperation should be forthcoming either for the company or specifically for Blautix that will be an option still availabe even if other projects don't prove as successful in their next stages.
- Hence, the company should wait to see for further successful results in other projects. Then 4D will be presented with more options involving the company as a whole. Any offers for collaborations/JV, strategic investment or even ... takeover, will be by several magnitudes better with (any) further positive news as early as Q4/H1 next year or by end of 2021.
In any case, even Blautix still has to go through phase III.
Boombaby: thanks for the link.
This bb seems to be turn especially interesting on Saturdays.
A few observations:
- the patients in the case of the ExeGi trial seem to have been outside intensive care as it is stated that a small number of patients, unfortunately, ended up in IC.
- in the case of 4D trial patients need to be on score 4/5 (as per requirements): 4 = Oxygen by mask or nasal prongs 5 = non-inveasive ventilation i.e. at a medium / first severe desease stage.
- inflammation is not mentioned as one of the symptoms alleviated by the therapy involving bacteria. 4D's therapy targets inflammation which probably probably means:
(i) ExeGi has been targeting less advanced cases and
(ii) 4D and ExeGi drugs are (potentially) complementary (if they could be combined)
- finally, the bacterial drug ExeGi used relies on 8 strains vs the single-strain therapy of 4D. I'm sure both companies have their reasons!
Was it always the plan to have 54 patients in the UK? Or, are they expanding the trial locations to reach quicker the targeted number of 90?
F.4 Planned number of subjects to be included
F.4.1 In the member state 54
F.4.2 For a multinational trial
F.4.2.1 In the EEA 72
F.4.2.2 In the whole clinical trial 90
Echoing the thanks to Noix. Other companies might have issued an RNS so it has escaped our radar screen.
Here is the paper given at the end of link provided by noix: www.nature.com/articles/s41598-018-30448-z
It is a mouse study. From the abstract:
- "Cytokine analysis of lung tissue revealed reductions of pro-inflammatory cytokines and chemokines involved in neutrophil migration. "
- "We have demonstrated that MRx0004, a microbiota-derived bacterial strain, can reduce both neutrophilic and eosinophilic infiltration in a mouse model of severe asthma. This novel therapeutic is a promising next-generation drug for management of severe asthma."
One thought re following quote from noix's post:
"Intranasal administration of Bifidobacterium longum 35624® or its isolated cell wall prior to virus inoculation ..." i.e. administration of the bacterium preceded the virus inoculation. If the two happened within a short time frame, perhaps we can't read more into it. But ... if the bacterium was given days before the inoculation of the virus, could it also play the role of a (hybrid?) vaccine for covid-19 given that the symptoms of covid-19 are similar to those of asthma?
In any case, it looks that the chances of success in case of covid-19 phase II trial have gone up significantly!
That's one of the many beauties of this share. Over the years DDDD has been building know-how as to how to harness, in methodical way, a previously untapped source of non-toxic living "drugs". That's exactly where their IP and value lies i.e. in that know-how and their ability to screen the relevant bacteria and to streamline the harnessing process (as we were told in the webinar). Every day they build further on such platform.
So it's not a binary IBS trial outcome that will be the main valuation factor (one way or another). A positive outcome will cement further the proof of concept: a process that is well under way through the oncology and the IBS primaryendpoint results. A unsatisfactory IBS result, less likely as it may be, should have a manageable and temporary impact on the valuation and the share price (in my view) as soon after that, attention will go to covid-19 and oncology developments.
The very fact that DDDD has created a platform, off which various LBP therapies can emerge, makes the company all the more undervalued. It can attack diverse diseases in parallel in a cost-effective way without having to spend up to hundreds of millions on each therapy that the typical big pharma company may have to do. Makes the company an attractive target already for players.
So in a nutshell, the IBS result doesn't feel like a binary outcome or the outcome of drilling a well in the oil and gas world. It will be merely a major step forward in the transformation of a company that has already been set in motion. Looking forward to next week.
And finally valuaion: by the end of this year we should have some further tangible data points to begin to value the company (e.g. depending on successes we know which markets are likely to be opened and perhaps objectives and focus will be re-assessed in the light of such results). At the moment all we know is that we are seriously undervalued given the potential.
Most important, in my view, is the ability of the company to adapt to new market conditions and changing customer shopping trends. The trebbling of online says a lot on this point though it would be interesting to see any comparison vs. peers. However, only reference to profits was with respect to the Nordics business and they highlighted the current uncertainty which of course it is hardly a surprise. Overall, computer says "yes" on the business.
... are a couple of factors that will determine, to an extent, the SP prior to the RNS. Nasdaq is more important and here is the good news (for today at least):
https://www.marketwatch.com/story/european-markets-bounce-higher-as-nasdaq-futures-rebound-11599638847
RG / other sellers must be coming close to the end of their string of sells and in particular those sales that are related to risk mitigation strategy. After all, it doesn't make sense to be selling at much lower than current prices . The SP had gone close to the 100p mark (mid 90s) even before the oncology trial RNS.
Also let's not forget the potential buyers who may be looking at an unexpected opportunity ... especially those who have missed the DDDD train so far.
Questioning what "Full value" means in the book of a CFO who doesn't appear to have much experience in closing deals in the sector isn't something that can be answered by you but ... it can be by the company.
Thank you though for trying to explain though ...
meant resources increase rather than reserves!
Bouncy ...
"It was your complaint about why a bad deal hadn't already been done" ? ... there you go again! Perhaps it's you who's missing a few points? First, of course I'm delighted about prospective and contingent reserves increase. But ... who talked about doing a bad deal? If the Lixus and Anchois assets are as promising as they appear, there must be the odd decent offer on the table already! You can't have it both ways.
But on the other hand, are you prepared to wait for a long time / years until JMW (who hasn't got that many credentials to demonstrate and in a company that hasn't done a deal for a number of years) decides a sky high offer has landed on the table? Get a reality grip please. There is an energy company that I'm sure you are well aware that went into liquidation after the oil prices crashed because its directors were aiming too high before the crash.
Still, it's your prerogative to aspire to be a long term investor (or a day trader?) and take literally every word the directors are saying and ignore the fact that it's hardly a new crew and Adonis's effective apology for failing investor expectations / creation of value to-date - interestingly he is the one least responsible for such failed expectations! Yet he showed the right attitude which will be followed hopefully by actions and not just words.
Oh and my comment about learning from the mistakes of the past (again that the CEO has effectively acknowledged) is hardly a trivial issue!
Today's fall is disappointing except perhaps for those who have used it as an opportunity to add to their holding.
However, if the fall had been on the basis of a leak, it would have been much graver. So the factors behind the fall must be related to Nasdaq / US markets fall and further de-risking ahead of news or pursuing of other opportunities by investors who have already made very decent returns. Maybe stop-losses have exacerbated the fall.
As someone said earlier, it's probably good that RG and others are selling now. I'd also prefer to see de-risking now rather than early profit taking if and when the next piece of good news comes along. That way the rise would have all the greater momentum.
Just a reminder, in terms of percentage fall, SNG had gone down by a much more significant percentage before the very positive announcement was made: institutional investors / fire-sellers brought about an avalanche that influenced the decision to sell by others.
Also, let's remember that because the brilliant oncology news by DDDD, the SP was deeply in the red the day before.
The above may or may not amount to something and it is a possibility that we don't get very satisfactory news on IBS. Nonetheless, even in that case we should recall that oncology programme developments should suffice to support the bulk of the market cap if not more than the current market cap. And therefore, we can think of IBS, Covid-19 results and the vaccine as very low priced options... Finally, you'll recall where the price was 5-6 weeks ago.
Bouncydeadcat ...
My point had nothing to do with the daily share price movement! In fact the higher the price, the better my fresh, very recent, and totally opportunistic investment in Char is doing. The reason it is opportunistic was vindicated today in the course of the presentation ...
Otherwise, if history is anything to go by, it's important not to be wearing blinkers when it comes to Chariot and to be weary of management's statements. Mr Pouroulis started the presentation well. But when it moved on, we didn't see much humility from Julian Maurice Williams giving the impression that lessons from the past may not have been learnt. Time will tell.
Should have said whilst they receive 50% of their remuneration in shares. Would have been Ok if the sp was not at such low price.