I guess Bioasis is down to the nitty gritty, and I think there are two questions left that need to be immediately answered. Is xB3 worth developing? And should Dr. Deborah Rathjen and the BoD remain with Bioasis?
The Question of DrDR
I think that shareholders might want to immediately consider whether Rathjen should stay. If not, then this is the moment to take action. There may be no later opportunity for this one. If xB3 has value, she certainly did not do anything with it. The deal that just failed was so bad that shareholders should not count on another one from DrDR being any better. And it may be a legitimate question of whether a new CEO could get something done simply by virtue of not being Rathjen. Maybe pharmas would like to deal with somebody, anybody, else.
In a lost cause, Rathjen squandered 12 to 18 months and a lot of money. She distracted attention from xB3 with the Cresence deal. She put Bioasis further in debt. Worse, if xB3 has value, bu downplaying its value she made it look like a failure and not worth pursuing. During the lost time there was no imagination and effort applied directly to the success of Bioasis and xB3. The result was the BTI share price dropping to 3¢.
I cannot think of anything DrDR has done that would count in her favour, or that would indicate that she could or would do the things necessary to save Bioasis and help it prosper.
The Question of xB3
There is one thing, maybe one last thing, that DrDR can do for shareholders, and it must be done. Bioasis needs to make a statement about xB3. Not about EGF. About xB3! All of the following questions need to be answered with all of the available knowledge and most considered opinions possible.
(A) Has xB3 actually worked as hoped and advertised, so far?
(B) Are there any issues with xB3, real or perceived, that are preventing deals from being done?
(C) !s there any actual work currently being done with xB3 by anybody?
It all comes down to whether xB3 is worth developing. Bioasis can answer these questions with some simple "safe harbour" language, but not language ridiculously intended as protection of management. Shareholders need to have these answers right now!
The Question of Help
Bioasis needs money now. Equity financing and private placements look difficult. There will be no financings unless investors come forward who are motivated by the promise of xB3 and the low price of admission of exploiting it. Therefore, it's about xB3.
I think any new investor, private or corporate, must be willing to work with Bioasis as a TSXV listing for the foreseeable future. Shareholders must understand that a NASDAQ listing requires Bioasis to accomplish some very significant things that, on their own merit, would allow Bioasis to achieve that listing without a loss of shareholder equity other than what an IPO would cause.
Clearly, a business development deal that could bring $5 to $10 million would be better than an equity financing. There have been companies sniffing around Bioasis for many years. If xB3 works, why haven't deals been done? Could they be done?
A business development deal with cash up front and an equity investment may be a good choice. Takeda
made such a deal with Denali. It would mean that the pharma has its hooks into Bioasis but it could also mean that further deals could be possible including and option or right of first refusal to buy Bioasis. It could also mean that Bioasis shareholders would retain a high ownership percentage of Bioasis, certainly compared to the deal just defeated.
There could be a benevolent lender, maybe a shareholder with deep pockets, who would offer a convertible loan of some sort to Bioasis. There could be a call on Bioasis assets but with terms that would take the burden of survival off of a new management's shoulders so they can operate Bioasis with good business practices. There are many shareholders who just want to leave. A loan of this type could allow a new management to work for at least several months or a year without undue consideration of the share price or foreclosure on assets.
We are left to understand that Ladenburg Thalmann brought the various parts of this deal together. They cannot remain associated with Bioasis unless they bring an immediate financing or business deal to the table If the plan has been to extract xB3 assets from Biodexa then it shows there is a market for xB3. Does LT have an investor willing to buy one or two xB3 programs at reasonable prices? Could xB3-001 and/or glioblastoma be sold to an investor for an amount that helps ensure Bioasis' future and still gives the investor a good shot at making billions on the deal?
But in the end, it's a licensing deal, a partnership deal or the sale of an xB3 program like xB3-001 that could get Bioasis restarted. There are efforts and a price that could get this done.
New Management
If xB3 is worth betting on, then a new management should be expected to immediately create a new look for Bioasis, something that promotes xB3 capabilities and opportunities. In my opinion, not only have xB3 opportunities not been exploited, they haven't even been adequately articulated or promoted. Bioasis management has always presented xB3 business as such a struggle. There are messages that could be created that are honest but also presents xB3 and the Bioasis business models in a far more positive ways than previously done..
For the time being, Bioasis cannot consider advancing its own programs. As a result, Bioasis management must develop business models that do not include internal programs but instead promote other business models. The licensing of xB3 for use with pharmas' own drugs is obvious.
I think a marketing effort should (must) be developed that advertises xB3 as a service for pharmaceutical and biotech clients' early CNS drug R&D. Whether it results in "service" revenue or not, it points out that early R&D with xB3 can save immense amounts of money and time for Bioasis clients. That is a type of confidence we have never seen from Bioasis.
Bioasis has patented or can patent various xB3 drugs. These drugs represent opportunities and should be flat out offered for sale or partnerships without reference to them being a part of Bioasis internal pipeline. It would be a tacit admission that we are not engaging in preclinical work. Everybody knows we can't do it, so we might as well have the honesty to tacitly admit it. Secrets, obfuscation, dissembling and minimal disclosers are signals to everybody that things are wrong and are being hidden.
These are the types of ideas that new management must consider. For a new management to come in and present their mandate to be simply saving Bioasis from its terrible past would be a mistake. It reeks of failure. Potential partners need to make good stories from their deals. Bioasis needs to look like a good story so that its partners look good, as well.
New material transfer agreement (MTA) optics are needed. No more secret tire kicking. If an MTA partner needs secrecy, there are nevertheless ways to present the MTA in a positive light, especially by giving it a code name whose nomenclature includes meta data describing some generic attributes of the deal. The MTA is being done to expose opportunity and value. It should be discussed and presented as such! The MTA partner is getting a free look and a potentially valuable asset. They must at least allow Bioasis some room to document the MTA in some favourable light.
Dammit, I've been tired for years of watching basic marketing and business principles being ignored and Bioasis being presented as a good idea getting worse. It's time to reduce it to its most elemental proposition. Does xB3 work, and if it does, this is what it could mean.
Current executive management and BoD (except for Hemeon) should be voted down. A new management is needed who understands the one important thing. If xB3 has so far worked as hoped, then it retains the potential high value that it's always had.
Clean Bioasis up and get on with it. Admit the business failures. Admit the damage that has been caused. Forget Rathjen. Forget the embarrassment. Make Bioasis new. It doesn't cost anything to apply imagination to new marketing and optics of an old, badly told story about a company with something really valuable that others tried to spirit away from us.
Take xB3. Make one deal for survival. Make another for better positioning. Hump the bajaysus out of it until you make something of Bioasis.
jd
P.S. In the movie, City Slickers, Curly pointed out that the meaning of life comes down to one thing. Bioasis is about one thing - xB3. Does it work?
Watch Curly:
Short version:
Long version:
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