Ann: Prospectus, page-2

I just noticed this bit in the prospectus (page 42):

Microba’s commercial strategy is to transact on its therapeutic programs and associated therapeutic assets with large pharmaceutical companies to complete clinical development and deliver innovative novel therapies to market.

If you take this as their raison d'être everything slots into place. The two boffins, Tyson and Hugenholtz, have developed a best-in-class microbiome testing kit which with some effort will sell well. As part of the deal for the test kit the company gets to keep and use the data from the results. This is allowing the company to put together a best-in-class database and, with the help of some AI, hopefully a pipeline of therapeutic programs.

There is not a great amount of money in the testing kits nor in the database. But there is the possibility of serious money in developing and then selling the therapeutic programs to the big boppers. Also on page 42 they show that a microbiome company, Second Genome, did a US$1.5b deal with a major pharma, Gilead, and another microbiome company, microbiotica, did a US$500m deal with a Roche unit and a third, Seres Therapeutics, did a US$1.9b deal with Nestle.

If I have got that right it seems that Microba is a bit like a sophisticated puppy farm, attempting to churn out designer gut microbe combinations to be snatched up by Big Pharma at hopefully nose-bleed prices. A ways to go though as their first "puppy" is only due to go into Phase 1b clinical work at the end of this calendar year. My impression is that Big Pharma are usually only interested in phase III product candidates.

The arrangement with Ginkgo Bioworks does not seem to fit that pattern however as Ginkgo has put $3m into the IPO but then Microba has to pay Ginkgo a similar amount for services in the next couple of years (?).