SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Biotech / Medical : XOMA. Bull or Bear?
XOMA 32.31+1.4%Nov 26 3:59 PM EST
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Robert K. who wrote (6825)7/28/1998 1:58:00 PM
From: aknahow  Read Replies (2) of 17367
 
Funding biotechs, so called dilution, private placements and etc. are important topics. What I have trouble understanding on any thread, BVF, Ligand or here is the concept that it is somehow evil to issue more shares. There is no magic wand. A company or an industry that does not have earnings, needs years and millions to develop an approved product that may or may not be profitable is going to have to give up something beyond the normal cost of financing, and in fact that something will be above the cost of junk bond financing.

Now one might think a secret deal with a big pharma is great but even when no additional shares are issued to the pharma the giving up of the major portion of the profits in exchange for up front funding milestone payments and royalties is obviously also dilution. But since the details are not provided one does not even know how much damage is done.

I do not like the no floor c.v.p. deals but one can at least go back and check out the actual issuance of shares and the cash received in a companies annual report. Perhaps these deals can be structured to keep their cost at only slightly above the usury level. <g>

While some disagree I see no logical solution for the industry until the FDA is forced to concentrate only on safety, and leave the efficacy issue to patients and doctors. The regulatory world can be changed while the way markets work cannot. That does not mean the FDA will change nor that getting it to change will be easy. But to cry and whine about dilution and the horrible deals biotechs must make is of no use.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News