<It may be that another member of our tour team will have something to post.>
I guess that was my cue....
I was also present on the tour of Pyng Technologies. I have been following this stock for quite some time, and this thread more recently. I think Ed has done a great job of summarizing the info gathered on the tour, so I won't bother duplicating that. However, there are a couple of points I would like to address.
First, on soliciting/taking orders now. I am absolutely convinced the company should NOT be doing this yet. Here's why:
a) If I sat on a medical planning committee, there is no way I would set aside a portion of our budget, or plan our daily operations around a product that is not yet in final design, and may not be available when we need it.
b) Further, if Pyng does accept an order, that order will have a delivery date attached, and it will carry a LOT of weight. Pyng will have to deliver on that date, or risk a very bad first impression in the marketplace. The best way to lose a customer, esp. in a mission critical industry, is to teach him that he can't depend on you as a supplier.
c) I do not want an outstanding customer order to be the force that drives Pyng's entry to market, and possibly compromise a more strategic launch plan.
So - DON'T take orders until you are VERY sure of exactly when, and in what volumes, you can deliver. Doing so risks your whole corporate reputation.
Secondly, on being first to market. Generally, the company who is first to market wins the lion's share of the market, even with an inferior product. This fact is unrecognized surprisingly often by industry players.
a) As Jack pointed out, we are not "first to market" for IO devices. However, we MAY be first to market for a red-marrow IO device, a distinction which has clear advantages. Mind you, we are not "to market" yet.
b) I was a little concerned that the company did not seem overly worried about being first to market. They feel secure that they will be the first with a device of this type. If they execute the timeline they presented to us, starting with having final design nailed down by the end of this month, then I am happy. But I will be very concerned if weeks turn to months, while they fall into the trap of "perfecting the product for too long" and woops! J&J or Baxter or CompanyX announce a similar device, heavily financed, ready for field trials, soon to be mass produced. Then, just to be sure, CompanyX launches a spurious legal attack on Pyng, charging that Pyng infringes on THEIR patent. This sucks Pyng's finances dry (not being cash flow positive yet), and the have to liquidate assets. CompanyX buys Pyng's patent...done.
I don't see this happening, as long as Pyng gets to market, as they plan to, by Q4. It is pretty safe to say that Pyng has would know about any competitors field trials, so it looks like they have a fair lead time on any competition. But I am not so naive as to believe that other companies aren't researching their own red-marrow IO devices. They read the reports too.
c) Management said that it would be a good thing if the current IO device companies spent lots of $$ and effort to educate/promote IO devices. I agree, because they will increase the market acceptance of FAST1...as long as these companies don't introduce (or even announce) their own new and improved devices.
d) Training is a factor in our favour here. The more time/effort required to learn a product, the greater the "market-inertia" the product has. Experts in product A sell their expertise, and will not want to invest days and weeks of training in new product B unless they have to. Fortunately, the training required for IO devices is very little, and therefore the market will be more "fickle" and willing to switch to FAST1 if it is advantageous.
That's it for now. All comments just MHO, of course.
Garth.
PS: I am not always this verbose...honest! Usually just at 2:00AM ;-) |
