AGM: THE PERILS OF PROMETIC —
There's not much new that can be said about Prometic at present. Everybody knows what the problems are — and they boil down to money. The share price is now floating at around $.70 and Prometic has two avenues to gain additional funds. The first is to sell shares, and the second is to close a cooperative deal, probably on PBI-4050, that will advance sufficient funds to keep the company going for at least two more years.
The most attractive prospect for existing shareholders is a Rights Offering. This would minimize costs and dilution, yet for some reason Prometic has never publicly considered this alternative. Less attractive is a traditional distribution, which will be expensive and dilutive.
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On dealmaking, Prometic has a troubled history. While some deals, such as those with the Red Cross or Omnio have been excellent, others have been questionable. These include deals with Taiwan, Russia, and most recently China. No recent deals have achieved desired results, and with the possible exception of Russia all have been canceled. Naturally this leads to questions about management's competence, and whether Prometic can conclude a successful deal — especially when the company is in dire financial straits.
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Short selling continues with chat-board bashing, as does a storm of investor negativity. FDA non-approval of Ryplazim was completely unexpected. Dark theories of FDA corruption appeared and given known collusions in the 'States, the theories can't be dismissed.
Prometic has never achieved the same market capitalization as its US peers. While Prometic's performance in developing new drugs has been impressive, unlike US competitors it has been unable to attract the large cash infusions required to sustain it. There have been questions about Prometic's continuous statements regarding prospective partners for PBI-4050 -- where are they? I suspect that management put off deals until PBI-4050 demonstrated its full potential in clinical trials. But that strategy -- set against murderous short-selling -- turned out badly. That's just a guess, one more in the confusion.
It also appears that Prometic's PPPS process must be improved according to FDA instruction not only for Ryplazim, but also for IVIG — although there's been no statement by management about this issue. However once the PPPS process clears that hurdle, ALL plasma-derived products from Prometic should be good to go.
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There's no way to be sure what will happen in tomorrow's AGM. Expectations are minimal.
The perils of Prometic continue.
Jim
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