Hi Mark -
Been trying to catch up on the DMX story. I thought for now I'd confine my questions to SI rather than SH ;- )
"The fact that the FDA is up inspecting the plant says they will approve -- it is the last step in the process indicating that safety and efficacy have been accepted."
That's been my take, too.
"As far as dilution goes, with a company to have 2 pipeline drugs at post phase III points with only 47 million shares out is quite a feat. Even if they had to issue 5 million more share, it still would be very low."
Agreed. The number of shares OS is low for this kind of company. However, this leads to a question about the goings-on with Acqua.
What is the source of the restricted shares? Have they been released (as restricted shares) by DMX, to be resold into the market by Acqua, to get cash without dilution?
If so, despite all the grousing, this strikes me as a not-so-bad deal - except... I'm not quite sure I understand it. DMX approaches Acqua, saying cash is needed. DMX hands over a whack of shares, and agrees with Acqua that they can be sold at a predetermined price range, with other expenses, and sidebars, so everyone's palm gets greased. Acqua, as is its practice, immediately begins flogging shares in proportion to the cash draw. The price drops, presumably until it passes out of the predetermined range, or the extent of the cash draw is satisfied (whichever comes first) then Acqua stops selling, until the next cash draw.
Depending on whether or not these stories about the FDA inspection are true - this could almost be a buying oppo.
Or, not. I suppose a lot depends on the company's appetite for cash in the next, say, month or two. As a short-term expedient, it may be all right - especially if the company expects good news shortly.
I'm just not clear on the source of the shares. Any comments?
Regards,
Jim |
