TS03 Inc Trust Units TSTIF

Sara Elford's comments

[anon314]

From Canaccord Genuity 19 Sep 2014

Officially submits response to FDA’s request for additional information; we continue to expect US regulatory clearance to be a 2014 event

•   TSO3 announced this morning that it has officially submitted its response to the U.S regulatory authority’s request for additional information. In early August, the company disclosed that it would take eight weeks to complete the request received in mid-July (with respect to its May 2, 2014 submission). TSO3 is confident that it is now in the final phase of the review process (labeling).

•   Management has indicated that it has been in active dialogue with the agency since July. As such, we think this latest submission should be complete in the eyes of the regulators and allow for clearance well before the end of 2014. In our view, the turnaround should be relatively quick (less than a month), while labeling-related matters are also typically quickly addressed.

  Channel partner discussions ongoing (and advanced)

 As noted in August, TSO3 is also continuing discussions with potential channel partners, with management saying that these discussions are now occurring at an accelerated pace coincident with the above-noted regulatory progress. Firm take-or- pay clauses are expected. With U.S. clearance in hand, TSO3 should be in a position to negotiate a strong agreement with the right partner.

Net/net, two key catalysts likely before year-end: US clearance and channel-partner agreement

 We continue to expect both catalysts to help move the stock closer to our target price.