Spectral Medical Inc T.EDT

Would someone pay $ 2B for DIMI?

[mercedesman]

It seems outrageous...  

Would companies like Baxter, or CVS, or DaVita pay $ 2B to buy the NA Rights to a brand new FDA approved, "game-changing, disruptive technology" from a small Cdn Company that had the foresight to partner with Infomed (Swiss manaufacturor) and secure the NA rights to the equipment for itself?  Incidently, Infomed seems to have had the foresight to want to include blood filtration in their machine patents, and knew that Toraymyxin had the lead, having been in use for 25 years ( over 300,000 safe uses), and being involved in an advanced confirmatory Phase 3B Trial in the US.

Well...

$ 2B doesn't seem so outrageous when you consider that is what Fresenius paid to purchase the NxStage machine a few years ago ($ 1.9B USD)

$ 2B doesn't seem so outrageious when you consider thta one of the other (very limited) FDA approved palyers - OutSet (the Tablo machine) has a market cap iin excess of $ 2B CAD today.


$ 2 B doesn't seem so outrageous when you look at the clunky competition, and the fact that it requires more complex water hook-ups (i.e. more that can go wrong) versus use of prefilled bags (dialysate bags)

$ 2B not so outrageous if you have secured a non far-east supply chain, including for peripherals like tubing, etc. (notiing that Infomed is expanding their storage capcity for 2022)

$ 2B not so outrageous, if you consider that it looks like Covid will keep morphing and that dialysis patients are amoung the most vulnerable people in the population (and would prefer to be treated int eh safety of their hoomes)

$ 2B doesn't seem so outrageous when you consider that dialysate bag delivery is no longer an awkward proposition, now that the whole world has gotten used to on-line ordering and direct to home shipping.

$2 B is not so outrageous when one considers that Dialysis Clinics are short staffed and need to work more efficiently (on-line serving multiple customers) .  Nurses can work from home with flexible hours 

$ 2 B doesn't seem so outrageous when one considers that the cost of HD is much lower than in clinic care. Insurance companies are taking notice of lower costs and improved outcomes for patients.

$ 2 B doesn't seem so bad when you talk to Nephrology Doctors that are now admitting that nocturnal PD provides far better results and gives patients a better quality of life (including freedom durign the day, and the ability to travel with their portable equipment and deliver anywhere bags)


$ 2B doesn't seem so outrageous when one puts themselves in the place of a Davita or Baxter who sees the potential for clinic revenues to slip away, and or hospital/clinic equipment sales to be cannabilized.  They want  desperately to remain competitive, and get a slice of an annual market that could be worth > $ 10B/year not to mention peripheral (tubing, dialysate, etc.) sales.


Seto describes the full FDA approval of DIMI (including for use in home) as a "WHEN not IF" event.


Incidently...doing the math....

$ 2B USD (assuming 280M shares O/S) translates to ...

$ 9/sh  CAD $
 (I know...it's crazy...but I'll take the hit for pointing it out)

MM

[Domino55]

Seems like a fair summary. Yet nobody is willing to pay 25 cents US a share for days on end.  "Coming Soon" and everything that surrounds it is having an impact.

[PezDalatoYou]

There is one big difference. The $2 bil that Fresenius paid for NxStage was for the entire company, at least that's how I read their NR. I'm assuming this would include IP, manufacturing facilities, sales force, etc. Why wouldn't DaVi just buy out Infomed itself? The Infomed NA rights can't be worth $2 bil using NxStage as a comparator. And what protection would Spectral have in

[mercedesman]

[PezDalatoYou]

I challenged your logic and now you are upset about it? Don't cry, your margin interest isn't due for a couple of weeks. I hope DIMI/SAMI is worth $2 bil but now to you we are worth $1 to $1.5 bil but you gaslit the value up to $2 bil...quite a haircut. It is dishonest to imply DaVi would pay the same for less and somehow now less is worth more.

[Domino55]

Pez-I have to disagree here as well. I'm sure that Spectral is lock tight in NA distribution rights from Infomed. A buyout of Infomed doesn't have any impact. Are you being disingenuous in your suggestion that they may not be or just trying to continue the dialogue?

[PezDalatoYou]

Dom, I challenged MM's math, identified a risk, and asked a question. I guess all we want on this board are riddles and gaslighting.

[hmmmmmmmm]

DaVita would really benifit from Baxter's manufacturing, distribution and sales.. while Baxter would love DaVita's address book and relationships with about 1/2 the dialysis patients in the US. Also CVS posted huge earnings today. Based on vaccines brought shoppers back into their stores.. 1. Need to bring people back into stores now that more people are getting their meds online. 

[mercedesman]

100% agree. My suspicion is that if the 35 person study/trial is done via DaVita, they will have the upper hand in negotiations. But regardless of who's end consumers are used, Baxter may very well be willing to pay up in order to play a role and grab a peice of the soon to be very lucrative, HD equipment sales market...though they likely do not want to provide dialysis services.  Only

[hmmmmmmmm]

And we already know they are trying out a similar partnership with Baxter's peritoneal machine- why wouldn't this colab work well centered around the real deal, disruptive DIMI machine. Strength + strength + strength. Baxter could also peel off the SAMI portion for hospital use. You have to wonder what the math starts looking like for Baxter if the DIMI trial top line numbers and PMX 60%