A Reality Check

Recently successful biotec IPOs like AMIT (successful Phase 2 trial) and DNAI have a key differentiating factor that separates them from BLT. The fact is that they have successfully completed safety profile trials.BLT has not, so current and potential investors don’t even know whether or not it is safe at therapeutic doses.

Consequently, it goes without saying that there is no conclusive evidence that it works.

BLT’s unique selling point for most of its pipeline is ‘one-shot cure’ If it works that’s fantastic but in the case of Hep C we would need to allow about 5 years before we could be certain whether it’s a cure or remission. Having said that it is also true about the AMIT peanut treatment and probably most other similar offerings.

The point I’m trying to make is that we can’t assume that investors who are prepared to pay probably US$16+ for a slice of the action are mugs. They will do their due diligence and realise that BNTC is well and truly a spec buy vis-à-vis, for example, AIMT and DNAI. – we can’t realistically expect to match their performance. BLT has great potential but hardly any runs on the board.

There are also marked differences between the investor profiles for BLT (RA Capital) and AMIT (Longitude Capital, RA Capital, Foresite, Aisling, Fidelity, and Jeff Bezos). Investors will note whose already on board - what does it tell you?


I have been criticised for trying to estimate an open price for BNTC at $14.30, However, that appears to be well within the range for recent IPOs
http://www.renaissancecapital.com/ipohome/pricings/priced.aspx.
Also shown in the Table are the returns and you might like to work out what made some comparable companies successful.

Frankly, when I look realistically at the offering I would be delighted (and very surprised) with a first day return of 20%. Having said that I would be even more delighted with a return of 100%+ but it ain’t goin’ to happen!