Dungiven, it is clear the strategy is to now chase DMOAD, before a deal will be struck to meet their "valuation". I think I understand their valuation to be $6,000 per course with a DMOAD label (+an upfront & royalties etc). The Chairman has already told us very clearly that the era of large upfronts is now behind us (AGM). If large upfront payments are behind us, what are we waiting for? 25% or 30% royalty% Is that really the sticking point. I would prefer them to go after the low hanging fruit of pain & function (seems already in the bag, but surely less onerous than DMOAD) so as to get started on the revenue front (could begin in 2024 with preliminary approval from FDA). After seeing that price appreciation chart that Humira achieved, I do not put a lot of stock in the advice they received about starting lower ($2,500) and attempting to move higher if all the stars align on DMOAD. Especially, as the company is now putting Zilosul in the same conversation / comparison to Humira. Below is how I look at the dilemma of not doing a deal now, chasing DMOAD at all costs and having to do a cap raise by end of 2023 calendar year. You can all play with your own assumptions on timing, sales #s, levels of dilution, etc etc, but I would love to see the board articulate how they are weighing the risks.
Assumptions in tables below: - 20% compound growth in sales / no COGS / no Taxes / no R&D rebate / 25% royalty / left out the 3%ish pass through to Bene - Cap raise of 100m shares done sub $1.00 at end of 2023 - So we are comparing share count of 283m vs 383m, waiting solely for DMOAD status vs starting with pain & function (yes I am making big assumption that FDA grants early prelim approval for 2024 on pain & function, but also a big assumption that DMOAD label approved in 2026)
So the valuation proposition all shareholders should consider (mess with the tables as you will):
PAR Price at posting:
$1.10 Sentiment: Hold Disclosure: Held
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