RE:RE:AEZS q1Tencents wrote: These results are alarming in terms of the rapid use of cash with no revenue
Wainwright projeted 1.1m revenue for the quarter
It was missed by miles
hwc seem to be throwing wild guesses at the probable future development without having done any real analytical work
They aren't alarming to Ronnie Miller. Far from it. Ronnie has repeatedly said that he is "thrilled" by the merger. Gilles has said he's "excited". Business is forward looking and not backward looking. Unlike H.C. Wainwright's analyst Gilles is in the catbird seat at both companies being also on the Board of Directors of AEZS. WIth AEZS's clinical trial for its diagnostic test now complete the diagnostic trial will no longer be a cash burn. The test is also up for potential licensing and previously received an inflation-adjusted C$40 million upfront cash for North America alone. There were also potential additional payments and royalties. What does Gilles know about the next diagnostic test deal AEZS has been working towards? How much upfront cash? This clinical trial is also set up to potentially establish AEZS's diagnostic test as the industry's first standalone test. It could be a game-changer. Currently two tests are required. The trial is also for the pediatric population and that is the most important market for growth hormone deficiency worldwide. The test is only approved for adults currently. How it works in a commercial environment can be monitored however. This would be the first time the test is approved for children - the most important market. A full marketing program across all ages could be launched for the first time with pediatric approval. Many areas of the world only really test for growth hormone deficiency in children. Growth hormone deficiency can also be important for adults given it can affect cardiovascular health, muscle tone, quality of life and mortality. AEZS can leverage its marketing to children to push the adult market.
There will also be certain cost savings from the merger as only one CFO, President, CEO, IR function, and Director of Business development will be needed, etc. They will also drop the TSX-V listing saving listing fees. A portfolio review will happen after the merger closes and the highest conviction assets will be prioritized and kept.
The merger also adds key resources and scale as CZO moves to its next phase as a biopharma and fully finances CZO's near-term revenue generating opportunities as said in the news release.
The combination of AEZS and CZO is expected to produce a long-term sustainable company.
"The combination is attractive for shareholders of both companies, as it is expected to create a long-term sustainable business..." news release
AEZS pipeline assets are also completing preclinical burn and development. Showing the market the complete preclinical packages and moving into Phase I human trials with a defined regulatory pathway is a key valuation milestone for these assets. The next milestones would then be value accretive human data which can be transformational for valuation. The assets can then be partnered mitigating risk and providing upfront cash and milestone payments. AEZS's pipeline assets target markets in the billions and proof in humans could be valuable. AEZS may have a shortened regulatory pathway for its hypothyroid program given it uses an already approved component.