@BlackPorche55 I mean, I kinda do think that's a fine management strategy.
- The clinical pipeline is significantly reduced and is awaiting write up (lower expenditure) - They already have a significant stock of Remestemcel-L due to ARDS + GvHD expectations (no need for significantly more until those development projects have clearer trajectories) - They are probably employing legal and regulatory consultants with regards to the aforementioned development projects + the sales team that they hired in preparation for GvHD launch (increase in staff costs) - On a maths point of view $6,085,000/2 is $3,042,000, so the increase is 37% or $1,134,500 (Hardly double which would be a 100% increase)
I suspect the 'certain milestones' that the Hercules debt refers to is the successful commercialisation of GvHD this year.
Otherwise very little new info.
- Comfort that the Hercules debt is postponed.
- CLBP still awaiting the imminent release (I like the phase 2 data and significance levels, but ultimately we will see - not even management knows if it works yet).
- CHF is definitely going to be partnered, it's just what that partnership looks like and if it will happen before or after the FDA discussion. If FDA says it is sufficient to justify approval on 1 trial then the bargaining capability goes right up, if not, then I foresee that there will be a huge cost offset component of any deal. If you look at historical deals (Novartis, Tasly and Gurenthal) they all incorporate those partners taking over some scalability or commercial or development costs. This will greatly off-set any further costs of development for the CHF indication and the partnership will also have an upfront payment which will generate cash. The only cost is time (significant don't get me wrong) but if I presented a big pharma company with statistically significant RCT results reducing mortality in class II CHF by 60%, a disease with the below statistics, and just said "Fund another trial and it's yours" there would be a lot of commercial interest. I would also like to point out that if 'Stage B' this study1 is seen as a representative distribution of Class II patients, then Class II patients make up 73.6% of the CHF population. In our own study, we see more a distribution of 206/537 (38.4%) patients being class II. However, I would be more inclined to think the real class II HF is higher as class III means sicker = more likely to seek therapy = more likely to take part in a clinical trial = recruitment bias. The therapy is effectively derisked and presents the promise of huge revenue streams; the only barrier is regulatory and manufacturing.
- ARDS. I don't know the patient demographic so it will be hard to tell, the more oldies we get or late progression patients we get then the rate of fibrosis goes up instead of the early inflammatory stage of patients we want. If MSB selects a subset of the study population (calm down the trial has already failed to meet the primary endpoint, picking subsets for potential efficacy is the next iterative step) that has elevated inflammatory markers then I suspect that population will have a bunch of significant outcomes, which will probably lead to a better-designed trial and Novartis honouring the partnership. EUA is a stretch and will have to have some pretty significant signals of efficacy for that to be considered. A global pandemic is definitely a time to stretch normal conservative regulations, but I think that it's still going to be too much of a stretch consider our recruitment criteria screwed us as the SoC changed. For all the people saying the trial was poorly designed, hindsight is 20/20, if anyone tells me that in May you could have predicted mechanical ventilation was doing more damage than causing benefit then I'll show you a liar. I put this down to an extremely unfortunate development (great for more people living, bad for the trial) as opposed to a negligent oversight.
- GvHD, revenues were said to be delayed 6 months in the recent interview. If he says that and gets it wrong then the SP is going to get badly hurt, so he must be relatively certain that the outcome of this dispute will be resolved around April and that resolution would be positive. Or he's reckless in saying it, tune in in two months time.
I'm staying invested for the almost certain CHF partnership.
(20min delay)