RE:RE:RE:RE:RE:Review of MarathonHere is my logic on the subject of early reporting of data from the restarted trial:
1.) They have until 10/31 to get cash to $20 million from likely somewhere in the $17-$18 million dollar range presently.
2.) It seems unlikely they can get there from normal operations as THTX has not yet entered the point when they are cash flow positive. They also have a big cash hit for severance costs on the laid off staff. Maybe they can manipulate payables, recievables and inventories more than they have already but it seems likely to me they will need some outside cash to get there.
3.) Accordingly, the incentive to promote any positive info they might get from the restarted, open label TH-1902 trial is quite high as that can be used to entice potential partners to sign a deal with them and/or position THTX better to sell stock.
4.) Let's assume they dose their first patient this week and their second patient the following week. Let's further assume they do a scan after the second round of treatments as they did in the first trial. By the end of September or early October, they would know if there has been tumor regression in those first two patients. If you take the timeline out to the end of October, you may capture some of the remaining 4 patients in the first portion of the trial as well. Marathon will know all of this data before it is released to us.
5.) Let's presume there is good data seen in those first scans. My guess is either Marathon extends further grace to THTX because they see it is heading to a positive place which will give them a nice bonus return on their options or THTX can use the preliminary data to encourage a partner to give them enough upfront cash to get beyond the $20 million or they use the early good news on efficacy to sell some shares to the public to get there. Marathon extending further grace might be the most likely option since they would be able to see the future big payoff on their options and would want to maximize that.
If THTX does not see some early signs of meaningful activity, then the company may have to sell some stock at low prices to get over the $20 million hump.
I have to think the 10/31 date was not just a random date but selected to reflect the reality fo the situation THTX faces. Marathon likely expects THTX to hit a hurdle or two in that time period and also likely has knowledge of what that might be. So, it could be that THTX is in advanced discussions wioth a potential partner and that is why Marathon gave them an extra four months to sort that out. THTX has also mentioned acquiring a new product and may be in advanced discussons on that which they may use the news of to raise a little more capital via a share issue. Or, it could be something like the scenario I laid out above on the restarted trial.
I am sure I am wrong on many specifics in the above scenarios but likely it is directionally accurate.
qwerty22 wrote: Your timeline on the part 3 looks like wishful thinking. With the new dosing and the known side-effects I'm expecting it to go as slow as the early part of the dose escalation. Talk in the PR of "three month observational periods" between each recruitment batch looks like extreme caution to me, I expect that caution is there within each 6 patient batch recruitment as well.
Protocol press release.
SPCEO1 wrote: That three month reprieve at no cost to shareholders is very good indeed! The alternative - deep dilution via more warrants issued to Marathon, a higher interest rate paid to Marathon or some other action taken which would harm current shareholders (which now include Marathon indirectly via their 5 million warrants which could really make this loan turn into a huge homerun for them) - was avoided. The possibility of one of those nastier outcomes occurring certainly contributed to the stock selling off so much recently. So, with that off the table and a very good indication that Marathon is a good loan partner and not a cut-throat operator, the stock should have a nice bounce. Any trader who may have been shorting the stock on hopes for a nastier outcome shoould be looking to cover on Monday.
Also, note that Marathon first gave a 4 week extension and then lowered the liquidity requirement to $15 million. Marathon knows everything about what is on the table at THTX, unlike shareholders. Could it be that THTX is in the middle of some important negotiation and Marathon knows it looks good for THTX? Since they want to make a lot of money on their 5 million warrants, they may not want to jeopardize whatever those negotiations might be by penalizing THTX at this time via higher interest rates or more warrants. If THTX does not get it wrapped up by October 31st, then maybe it is a different story. So, to me, I am thinking there is a chance some deal is in the works that Marathon wants to support because it will benefit its warrants and this might explain why they did what they did. That deal would likely be related to cancer and THTX might have told Marathon they need that much time to get the preliminary TH-1902 data to conclude the deal. Just guessing but that is a plausible scenario.
Let's say they enroll the first patient on Monday. Then enroll the next five over the three weeks following. By the end of September, that first patient as well as some of the others will have had 6 treatments. I am not sure when they will be doing scans but I am guessing they will know if things re progressing well. That preliminary info can be used to share with anyone since this is an open label trial. It may be sufficient to sign a partnership deal with some other drug company. We know the ASCO conference generated interest in TH-1902 so it is possible a partner is lined up and just wants some more info from the restarted trial before pulling the trigger. It may also be enough to sell a small amount of equity in the company at more reasonable prices if there is no partner lined up.
There are other alternatives as well to get cash back to the $20 million mark by 11/1. Those are not as attractive (selling shares via the ATM, for example) but they be utilized if needed to get to the $20 million mark.
Also, I assume Lafond and Marsolais were still restricted from exercising their options and trading the stock through yesterday. So, with this news out, there may now be a 10 day period open for them to decide what to do with their options.
juniper88 wrote: There won't be any results of the TH1902 trial by the 31st of October. They haven't even enrolled anyone yet. Yes, they got a 3 month reprieve but beyond that I don't see how this is good. What is Paul expecting to happen in the next 3 months that we don't know about?