RE:RE:All take a deep breathAny increase in revenue helps, and we have seen Egrifta sales looking a bit perkier than normal - at least according to Bloombergs always suspect estimates. But it is hard to see those sales making them much more attractive to a lender. If I am a lender, I have much greater confidence in the ability of TH to pay back their loan if they have some early success in cancer or are able to pull another rabbit out of their hat with NASH. If all they have is Egrifta and Trogarzo sales to back a loan, I am less confident, even if Egrifta sales are rising, since Egrifta's patent on lipo could be challenged by a generic drug manufacturer (this has been true for some time yet nobody has challenged it) and the higher Egrifta sales get, the greater the incentive there is to challenge that patent. Meanwhile, Trogarzo sales are not likely to rise and may even fall. So, if you lend to TH just on the basis of Egrifta and Trogarzo, you are counting on the ability of TH to meet the interest payments over the term of the likely 5 year loan, which seems doable, but also the ability of TH to refinance it when the 5 years is up. If TH has an attractive cancer and.or NASH asset, making that loan is much easier to do as the lender can presume they will either have decent revenues flowing in by the time the loan is due for repayment which would cover the principal amount or a presence in the capital markets which would easily allow them to raise equity to pay off the loan. But if there is no cancer or NASH asset, it gets a lot sketchier. You might get the loan but the terms are not likely going to be attractive.
So, a lot is riding on a good cancer outcome in my view. If the outcome is really good, then maybe the stock soars past the $14.80 conversion price and the convert converts into common stock leaving no need to refi it. If the cancer outcome is bad, we may be looking at ONO #2 in order to pay off the convert. And there are a lot of possibilities in between, including a smaller loan combined with ONO #2 to raise the money needed to pay of the convert. Also, maybe they can get a meaningful amount of cash out of a Chinese cancer partner which helps reduce the burden for an ONO #2. There may also be other positive things they have up their sleeve that we are completely unaware of at this time.
None of can know right now how this will all fall out but it is clear we are at a critical point in the company's history and it could go very well for shareholders or it could get messy again. TH's board panicked last time they needed to raise money but they are being more patient this time which tells me they are confident about a good cancer outcome. But until we actually get an announcement that preliminary efficacy has been seen, the potential outcome has a wide degree of variability. But we should be very thankful that TH is not one of those biotechs that have no revenues and therefore no good options as their cash dwindles during a period when financing biotech dreams has become quite difficult. TH has been very, very quiet lately, so something is up. Unfortunately, I really don't know if whatever it is they are working on behind the scenes will be good news, bad news or a mixture of both. Board member Holler's insider buy of $100,000 worth of the stock is a good sign and the absence of an earlier financing also may be a favorable signal but we are mostly flying blind.
qwerty22 wrote: I have a question.
I'm not holding my breath for a large increase in revenue but is there a smaller amount of growth say in Egrifta that might change some of the metrics around a financing or re-financing of the debt? What sort of minimum increase in revenue could make them more attractive to lend to?
palinc2000 wrote: and relax!!!
THTX 's fair market value is not reflected in the SP...
The stock is not traded ....no sellers and no buyers
Almost 100 million shares outstanding and a few thousand shares change hands
Fixating only at TH 1902 is only one component of THTX