scarlet1967 wrote:
Let’s look at two scenarios, one the actual events and one a hypothetical version starting with the announcement of perusing HIV NASH program.
The first scenario the actual events:
The announced they will peruse the HIV NASH after a long wait (presumably because of changing the plan to go with General NASH), later on last year they eventually they announced they will go with General NASH based on the advices by the KOLs and they planned a meeting with agencies in few weeks, I believe they knew the market would be somehow skeptic so they brought in Dr. Grinspoon and Dr. Roomba to answer questions. They then decided not to announce the date of the submission of the protocol, the few weeks ended up being few months until early this year they announced both protocols were submitted and both got the letter may proceed from FDA but nothing about EMA. Soon after they closed the offering and the investor presentation was down for more than one week right after the closing so new to be investors couldn’t really make an educated assessment whether they should offload their position for a quick profit or they should stay put because they could make more profit due to potentials of the program.
The second hypothetical scenario:
They announced the HIV NASH and instead of waiting a long time as soon as they planned to explore the idea to go with NASH they would inform the market that they potentially will change their plan and are in the process to validate their decision by consulting the KOLs, why? Because the long wait between the two news killed all the excitement so they could keep the story relevant by communicating all the stages of their decision making process.
They knew the market will be skeptic so they should produce that life science report before the general NASH announcement to mitigate some of the skepticism.
They should also upgrade the website in advance to maximize the effect of the good PR. Although not conventional they should inform the market when the protocol was submitted why? Because surly it would not affect the agency’s response but by not announcing the submission they created more uncertainty about the legitimacy of the protocol, they effectively send a message that they are not confident about the protocol fearing rejection. They would also communicate more clearly as where they stand with the EMA re the NASH.
After the good PR they would wait for the information to get digested by the market and attend few conferences explaining the protocol to both retail and institutional investors, the net result would be an appreciation of the valuation and potentially much better deal as their science and its risks/rewards had been explained and understood by the market so instead of almost not getting ascribed any value to the program some value would be baked in to the SP.
In my view they didn’t handle the information flows correctly, it wasn’t lack of marketing but really bad marketing, many wrong decisions were made leading to the current low demand/valuation. They seem to agree with part or all of this assessment as they will RE-engineer the company’s marketing. My concern is after a number of bad moves from this company how much faith one can have in their abilities to RE-engineer? Of course the board is not involved with day to day activities but we are talking about big strategic decisions which a proactive board ideally should be involved with.