The present drama that we are witnessing in relation to raising funds has been played out innumerable times. I have found it helpful to compare the PER journey to Neuren that developed and out licenced a drug for the orphan indication Rett Syndrome. I witnessed how investor sentiment waxes and wanes but there are typically three defining moments towards the end of the long road: the out licencing agreement, the topline results from the pivotal trial and the decision by the FDA.
All is forgiven today, but Neuren management was hammered by investors in relation to the terms of its out licencing agreement. Its market cap was stuck around $100m for a considerable amount of time until rising to approximately $500m at the announcement of positive topline results. Once approved by the FDA the market cap moved from approximately $1B to $1.6B. I have not even mentioned the fierce debates waged by investors over each and every capital placement along the way.
So, what's the point and aren't they apples and oranges. The drugs and disease indications are different but the strategic management oversight is unsurprisingly similar. I am struck by the fact that there is a pathway forward for accelerated approval for avicursen that will hinge upon positive data being announced in December and further, the out licencing of the drug is still in negotiations. But of course, no one knows if the announcement will reveal positive data, positive signals or negative data and so we come to management exercising prudence. Accelerated approval would be an absolute game changer that would compress all the time frames.
PER Price at posting:
13.5¢ Sentiment: Buy Disclosure: Held
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