Member Info for rhubarbmk2

PM; I have to agree strongly in that the handling of CLX, to date, has been top shelf.

Porky. Nothing you say is impossible.

However, the scenario relies on a fairly null delivery outcome in 1H 2023.

I just don't see that happening, personally.

With 3 million in cash, two new and very competent crew members, and growing momentum in the lab, then I expect material progress.

You can point to probably 90% of AIM Companies and make the same statements. Namely, that a lack of delivery may necessitate overhead raises at a suboptimal SP. So VAL is little different in this respect.

All I will say is that the time for buy-and-build, in my view, is when the SP recognises the competence and outcome of an involving strategy, that needs to firstly demonstrate successful build-then-buy. If it cannot do this with resources to hand, then there should not be subsequent buys, unless these can be done with existing cash-in-hand and with an immediate generation of revenue. This is probably a fairly common belief.

The BOD tell me that they respect SH democracy and are able to modify course, so I'll take that over a a Cenkos report; rightly or wrongly.

In any case, I could outline to you the very best list of possible outcomes this year. You have provided the worst. In my experience, the reality will likely reflect something in-between.

In essence, we talk little of the new compounds; any of which may transform Company outlook, at any stage, up until IND submission (if held for completion, which I see as unlikely). I might nominate myself to the BOD, as a large shareholder to ruffle feathers, if I am not satisfied with projection. But there's an equal chance I may not. Or I may do it to save the Company a good few quid in consultancy toxicology and pathology fees concerning the new compounds.

In conclusion, there's so many variables in play for any of us to give concrete prediction. You give an, albeit informed, worst case scenario. Someone like PM would give a best case scenario. None of us know. But it's balanced. You just see the "rampers", as they post more than they otherwise might, to refute your "deramping" (which I respect you'd call "realism").

I note your points, and the converse. But, again, this is AIM and little different to many others, confounded in part by longer delivery outputs in bio pharma.

My view is buy, hold, or sell. But I'm personally not one to make the very same point, again and again. You sold well here, and credit to you. But I see a frustration too, and I'm not convinced that this is all down to VAL.

Have a good rest of weekend pal.

No one minds a realist, Porky. And, as I've said before, you certainly make some valid points in your posts.

But any ramping I've seen is certainly more than offset by some - including your good self - suggesting a raise at 5p, and even less, in a buy-and-build strategy.

That just isn't going to happen.

You can tick that possibility firmly off your list.

Cash raises for encouraging in-house projects, at "bargain" prices, when cash gets short and 2.5 year preclinical development timelines haven't yet been reached, are one thing. "Luxury" acquisitions are quite another.

Even if the BOD wanted to do that, which I understand they don't, there will be no buy-and-build anywhere near single digit pence share prices.

Rest assured.

I think maybe we just need to take a breath at this juncture.

The BOD haven’t, as yet, just blown 30 million shares on a lab generating 300K per year.

I do know that around a year-and-a-half ago, there was a conversation between myself and Suzy around how she didn’t want VAL to be a life-style Company, and that is a reason why they were encouraged to explore the tCRO arm of the business. This was probably highlighted when new evaluations started getting delayed, due to a short-fall in external service support (also demonstrating additional opportunity). But, admittedly, as the current SP somewhat sucks, this wish to guard against future raises, is not ideal in its timing. Most of the posts clarify that.

I’m trying to remain neutral here, but what I would say is that it would have been easier to drop TheoremRX 12 months ago, for short-term flak, as opposed to keeping them on-side in the interim and suffering months of anguish. And, in some ways, it would be easier to just stick to a discovery Company remit. However, do bear-in-mind that this could in theory necessitate 2-3 years of continued yearly raise; especially if compounds were kept for the full pre-clinical life-cycle, using other service providers. Although by bringing in several and planning to continue doing so, the BOD themselves are mitigating for potential drop-out. The “multiples” strategy is a sensible approach.

Essentially, many may prefer this route in isolation, and the BOD could simply say “SHs didn’t like the service proposal”. But we don’t have to be in two extreme camps.

To my mind, there is always a sensible way forward, and it may be that the BOD are much less aggressive in their intended proposals than may be evident from the broker note. They can’t post here, so let them have their representation. They may tell us that they have absolutely no intention of a cheap immediate acquisition, but that this negates the need to request overhead at the usual AGM. Who knows?

It’s perfectly acceptable to me for the BOD to tell me that they think SHs are wrong, and in doing so, to outline exactly why. Many SHs are business-minded, or run businesses, so it will be a convincing argument to change minds. But I feel they are conscious of SP performance and general mood, and they are willing to express their views.

It may be that people still vote against, but at least everyone should be clear of the strategy at the next opportunity of asking for headroom.

We know about the desire to "buy and build", but they have not given us an indication as to potential acceptable "cost". Hopefully they will.

I’ll ask them, and then I’ll be happy to say what I think would be a good plan, but I’d like to hear them first.

Oh another thing - Cathy worked at C4X. So, and Lord knows we need a touch of it, I do hope that with a bit of luck she has brought some of these potential partners with her.

PS - Cathy - don't offload CLX too cheaply ;-)

Badsterman - these massive CROs outsource a lot. I work for many of them myself. They've become almost pharma-like outfits themselves.

The reason is that these niche activities are used periodically, so they often don't generally "bother" to run them in-house. Also, all the companies running this overall particular type of study do the ex vivo bit, but need the in vitro "arm" of the study from elsewhere.

In the CRO world, if you develop something in a niche space, and do it well, you can't really go far wrong IME.

Good point. The main preclinical one is IL-17, IIRC.

There's a reason for that. Well, two in fact, but one I will say here is that this was partnered really early on - as in CLX001 stage. In fact, I would imagine there's a chance that it is currently less further on than CLX. So value accretion there is limited. And the market is comparatively squeezed and very competitive in that particular therapy area. Hence why Phase-1 ready attracts larger upfront payments, and something I'd encourage.

Another is NRF-2. Again, I'm not even convinced that this one has started IND-enabling studies, as CLX is. AZ have partnered up. Again very early stage.

C4X seem really good at getting partners in, in full credit to them. But I think they are doing it too early (IMO). Having said that, I wouldn't mind one of ours going early, and maybe developing the others to a later stage.

The other is Phase 1; an addiction one IIRC. Now, theoretically, this should be in a different league, value-wise. But again, perhaps perceived as high-risk (extremely hard to model addiction preclinically), so a bit less certain than a good oncology package.

It's a good contrast though. Honestly, I'd look at extremes. C4X at 50 with, let's say 1 "proven" asset (Phase 1), and two very early stagers. SAR with one Phase 1-ready compound, which did have a MCap of 250, maybe 300M, in a "good" therapy area, although that has recently slipped.

I tend to come down the middle in estimates, but in oncology, higher ends are acheivable.

PS - 5p by June? I'd actually be tempted to start saving up for that, current issues aside. The cost of the VAL shell, with couple of million in the bank, and a lab worth more, by that stage, than the initial million investment. That's a fairly low-bar proposition.

To be honest, I like an informed chat, and am not currently is a particularly rampy mood myself.

But, whilst I am here, I've been reading some finer details about the Novo-Ventus NLRP-3 deal at the back end of last year, today. It kind of erks me that an argument often spouted is that with CLX0001, "revenues years and years away" and will need "extensive clinical testing" before VAL would see any material benefit.

NLRP-3 is NASH, not cancer, but you can assume comparable potential markets.

The drug was bought last year for 70 Million USD upfront, when Phase-1 ready (VAL are potentially taking SPVs here), with milestones of up to 633 Million USD. Primarily due to "compelling pre-clinical data". If there's one thing I do know, it is at least what "compelling pre-clinical data" looks like.

Just thought I'd hang that here; to hopefully at least put to bed the notion that pre-clinical Phase-1 ready candidates have limited financial appeal.

In other news, the same company, Ventus attained a 130Million Series C fund last year to develop a platform for three new pre-IND drugs.

So, you do need some luck in the field, and the right opportunities, but the potential is there.

Some points noted in there, Porky. Couple of pick-ups:

It really isn't a particularly competitive space. I agree that one of the 4 staff would need to undertake a BD role initially, and, with maybe the first three customers or so, you start to build a core of repeatable business. In this area, if you build it, and provide a customer-centric attitude, more do come.

I have two customers who aren't even working primarily in the in vitro cell culture space, but they need cell cultures to complement their ex vivo work in developing biologic drug human screening assays (which I read for them). They can't get anyone nationally to provide them with these. I gave them three suggestions a few months ago, and no one had the bandwidth or willingness to do it. They are totally stuck for this type of service. So much so that I am pressing Suzy to set it up as quickly as possible, and offer commercial target-expressing cell cultures. They will be able to do this.

So I don't even work in the cell field, but already - without even thinking too much - have one, maybe two, customers for the new lab. One is a small CRO, the other is one of the worlds leading CROs - it has it's own market cap of about 28 Billion US - and even they are struggling to do it in-house. We've not even started on the primary remit of the lab - to serve primary drug developers, either - the above would be providing a service, to a service provider. Each of these TCR studies costs between £40-80,000, and getting a positive control cell culture is a fairly central and vitally crucial part of that study.

Revenue will be relatively swift (IME); profit less so, but that will be mainly as the initial revenue through 2024 will likely be used for overheads and local expansion. Customers and revenue being my key criteria of "success" in 2023.

Yes - there are concerns about certain current movements and propositions, but, at least for me, this first lab is certainly not one of them.

Thanks Hoosier, but I won't kid myself. It's much easier to stand on a sideline and sound like you'd definitely win the match if you were in charge. Just trying to be fair to all (and no; unfortunately not) :-)

Nom; BOD members with deeper pockets I believe are less likely to dig deep if continually pressured. They know my thoughts on this, and it may or may not tie into the conversation, but I won't over reach.

Morning all,

The lack of clarity regarding the tCRO strategy, in detail, plus explicit confirmation of potential fundraising plans, has created a void for speculation. This is not conducive to a fair and reasoned debate, with all information to hand.

Whilst the idea of having a dual and inter-linked businesses – a reliable income stream-generating CRO umbrella, plus a generous pipeline of new emerging products traveling through pre-clinical evaluation, is sound in my mind, the foundation of the current MCap and recent SP performance has created uncertainty and, for many, decreased confidence. This isn’t fair on shareholders, and, in the absence of being able to make forum posts, also doesn’t give an opportunity for the VAL BOD to address “live” issues, to make their case in real time; especially to those not in a mind to contact the Company directly.

For this reason, I have arranged with the BOD to have a pre-recorded QandA, to be broadcast next week.

This will take the form of myself asking questions to Suzy, Kevin, and Stella. The questions are pre-set; purely for the reason that they want to cover key aspects of the strategy and financial situation, which is sensible. However, I will ask them these with a strong mindset of the concerns that have been raised. These reservations are fairly consistent, and so this should be a relatively-straightforward task. The questions will be to-the-point, straight-talking, and open. I am hoping for robust representation. I have every reason to believe that this will be the case.

The recording will take place in the middle of next week (Wednesday), and be available to view shortly afterward. People can view this in their own time, and subsequently make their own decision on how to vote in the upcoming GM.

It’s fair to the BOD, and it’s fair to shareholders.

Good day to all,

Adam

Good man.

We finish the day with a fairly unremarkable dent in pre-existing holders' paper balances (less than most days' normal swings), but now have a lab and the tools to generate revenue.

I personally think that a single digit drop, in exchange for a lab, is a good deal, but WTFDIK.

Fraid not pal.

You can see all the clinical data though, on the website.

The data is excellent, but the patent is not (length-wise); hence limited options for partners.

A new approach (reformulation/patent) is needed. This will be done after the hand-over.

This will not be problem for the new compounds, which, if successful, will have a circa. 18 year patent, before hopefully being partnered/sold.

Out of three SPVs, I'd expect at least one to be partnered/sold. If any of them is, you go straight to a 50-100M MCap - even if only one compound is all you had. No lab, no 201; zilch.

Even if one is late stage, but isn't sold yet, you can go to 100-300MCap, depending on perception/indication - see SAR.

People can disregard my posts, but I always at least try to call it as I see fit.

And if anyone has been offended, I don't particularly care.

The 201 actual data is peer reviewed, but there are no papers published; I assume as the TX "deal" negated the need (at least at the time).

Any emails to me will be treated with the utmost privacy btw.

Maybe I am not always on form Sooty. True.

My ideal scenario is to raise at 20p plus. As of Monday, I'd have wanted that end of 1Q. But then if TRX pulled, we'd be raising in more uncertainty.

So I guess there's a balance in not wanting to rely on TX to move forward, but yet limiting any raise; rather than raising more, at the lower level. You can't wait forever.

Might be a shrewd move, might not be. Time will tell.

I'll still be here; maybe just me and OB! Good luck in your investments.

DH - email me. I'll get you a copy of my share accounts, for two years, where you will find zero sells, to put your mind at rest.

Thanks DI.

Good to know.

SNG put one egg in a very poor basket, Up.

Having multiple drugs and a lab is precisely the way to avoid this.

IMO. DYOR

OK had a response.

"Questions@valirx.com".

This one will get a senior member seeing and responding to it, if not Suzy. And probably very quickly.

Now you can all pelt her with mud on here. And yes; people are pleased with things, and displeased with other stuff, but please tell me one other AIM management team where the CEO or other BOD member responds quickly to any punter emails, if at all.

Ratcliffe- raised that.

For belt and braces, feel free to email me, and I will cc you in, straight to someone on the BOD, where you will get a response, which I can assure you will be swift.

I'll triple check with Suzy too.

My email is printed on many of the RNSs Sept/Dec last year.