RE:RE:RE:RE:RE:Alternate Financing for NASHI don't disagree with the optimistic view the asset is on par with the others and it does mean something to have Harrison (especially) and Loomba understand and see the scientific validity. They also made that point that safety befell a number of drugs and this is past that and only on the efficacy stage. I do believe in the science around tesamorelin and the liver/fat and think one day we'll be positively surprised with results from those 400 trial participants.
But my point is just taking what "the market" is saying regardless if it's right or wrong. If you're the banker, how will you answer this question from your salesperson -- "Hmmm, you mean to tell me a week ago I could have bought the whole company, including it's $65mil revenue drugs and a potentially fantastic oncology platform with the NASH asset for $350mil and today you want me to just buy one risky asset for $500mil?" Or, "so the industry passed this by but you want my clients who know nothing about the industry to buy it?". The optics just make it really hard to do a spinoff with a capital raise attached.
SPCEO1 wrote: Also, the big question on this is does the endorsement of the three scientists, Harrison's perhaps being the most significant, fill the data gap and allow a more proper valuation of TH's NASH asset. Up until the KOL, many were leery of putting AKRO, IVA and Th on equal NASH footing. Is that still a legit argument. I mean, these are the NASH sector's biggest consultants - that must mean something.
SPCEO1 wrote: But who is that market ascribing that value? Mackie, Canaccord and NBF - not a very influential gorup. MAckie is still only saying a 25% chance of success, Canaccord ran some numbers but really did not work hard at it and NBF has not run any numbers. Why is anyone accepting this lame evaluation of TH's NASH asset? What if Piper, Raymond James and HC Wainwright ran the offer and said they believe that Loomba, Harrison and Grinspoon are medically correct (which they likely are)? And that if that is true, then TNSH is not that much different than AKRO or IVA. It would take some selling, but there has rarely been a better time to sell something that is fake (as CYDY has proven) and this is likely true.
Do you think TH has a lower probability of success in NASH than AKRO or IVA?
Wino115 wrote: I have a hard time believing a market that currently ascribes a rather low value to the asset would readily accept it at a massively higher valuation. One bigger than the current company they could buy for less.
One alternative was put up here before. It was a healthcare oriented venture bank that lent to biotech projects for future revenue streams. I don't recall who posted it but it was a deal where they Committed a chunk of money to see a drug through a trial and they released portions of it based on milestones. The interest rate was either low or non-existent and the economics were they owned a portion if it was successful and also got the principal paid back. While the company sounded very legitimate and it's creative, it adds nothing beyond money as opposed to a pharma industry player doing something similar but also providing some intellectual value-add.
qwerty22 wrote:
I had a thought of this as well but didn't know how doable it was. It seems a way to force a valuation and also limit the risk to the company somewhat.
SPCEO1 wrote: Paul mentioned they are pursuing alternate methods to finance the NASH phase III trial. What might that include?
One option would be to spin off TH's NASH assets as a spearate company. If they did that it would be fascinating to see the brokers suddenly ascribing value to NASH as they compete to get the lucrative fees in the listing. It should not be too hard to separate the NASH assets either. Probably two of the best companies to compare TH's NASH asset to would be AKER and IVA. They have market caps of $866 million and $535 million respectively.
TH could list TheraNASH (my suggested name) for a valuation of $500 million with TH keeping 60% of TNSH's stock (my suggested symbol) for itself and with the other $200 million going directly to TNSH to fund the trial.
We are at the top of a huge bubble. Brokers like large fee income. Something like this could probably be pulled off.