Happy Monday Mozz. I'm keen to ask, do you really see a loan of any sort as a possibility now? I struggle to see who would offer this. To me, either Pharma see a profitable opportunity here, or the party's entirely over. If Pharma doesn't see a return coming from this opportunity, why would a lender? Who is going to loan us a vast amount of money? Lenders need guarantees of repayments, and we can't offer that. They need collateral, and we can't offer that being that the loan required will be far more than the asset value of the company. I don't see a single reason why a lender would touch us if Pharma won't.
When Paul says US$50-60m for Phase III trial, my mind goes to how Paul always gives the most optimistic view. I'd say US$60m is the baseline here. However, if we're going it alone without deals, that's not even the whole story. There will be post-trial costs associated with product registration. There will then be substantial costs to set up and manage PAR's role in the manufacturing process (recalling that our arrangement is to buy bulk product from Bene and convert this ourselves to the final liquid injectible product), then costs for packaging (vials/injectors), marketing, sales, distribution. Without deals, we'd need a loan that can cover everything up to actual sales revenues. Are we really counting this as plausible?
If the TGA green light us without us having to physically start FDA Phase III, then maybe there is a possibility with us getting to Australian sales without a deal (start very small scale and try to build domestic sales) but that's the only angle I can see where the company can advance at all without a deal.
I know i'm sounding very bearish compared to how I used to talk on these boards about the PAR opportunity, but I think that's highly reasonable in the circumstances we're now in. On the spectrum of Chicken Littles to Happy Clappers, i'm definitely walking around in a hard hat. I still hold in the sole hope of a deal, which would show PAR still has a pulse. I hope that your unrelenting confidence in the PAR team is well placed, and they are already well down the track in tying up binding agreements to fund the years ahead. It can definitely still be achieved. I have personal experience of holding a stock through dog years when it dropped to 20c and then role again to over $4 (PLS) but I actually think this has been a far harder hold. PLS had a large asset of value, had cornerstone investors including instos and from other large entities within their sector, offtake agreements for future sales, and crucially, a management team who were always completely straight with shareholders through thick and thin. In comparison, PAR is found lacking in all areas whichever way I contort it. Go well mate. If it all crashes down I hope it isn't too devastating for you, knowing how much precious time you've devoted to thought, research, travel etc in recent years. If they can announce a deal, you'll be the first person I think of.
PAR Price at posting:
22.0¢ Sentiment: Buy Disclosure: Held
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