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Biotech / Medical : Biotech Valuation -- Ignore unavailable to you. Want to Upgrade?

To: Biomaven who wrote (4587)	8/31/2001 10:16:16 AM
From: Biomaven	Read Replies (1) \| Respond to of 52153

This GLIA release is interesting. I've never understood why desperate companies in the US don't make more use of rights offerings rather than selling out to toxic convertible creeps or doing sharply discounted PIPEs. In the UK this is a pretty standard procedure. For those not familiar with them, the idea is that all shareholders get an "opportunity" to buy more stock at a substantial discount from the current market price. Individual shareholders either cough up more money or are diluted - not necessarily a pleasant choice, but at least they have the choice. Thursday August 30, 5:39 pm Eastern Time Press Release SOURCE: Gliatech Inc. Gliatech Announces Rights Offering and Provides Update on Adcon(R) Status CLEVELAND, Aug. 30 /PRNewswire/ -- Gliatech Inc. (Nasdaq: GLIA - news) today announced that it has filed a registration statement with the Securities and Exchange Commission (``SEC'') related to a proposed rights offering to holders of the Company's common stock. This rights offering is expected to occur in the fourth quarter of 2001 and is intended to provide additional financing to the Company while allowing current stockholders to maintain their proportionate ownership in Gliatech. RIGHTS OFFERING Pursuant to the registration statement on Form S-3 filed today, Gliatech expects to distribute to stockholders subscription rights to purchase shares of common stock at a price to be determined. The terms of this rights offering, including the number of rights offered, exercise price of the rights, total number of shares to be sold, and other terms are to be determined prior to commencement of the offering. Final terms of the offering will be provided in a prospectus to be distributed after the record date. A registration statement relating to these securities has been filed with the Securities and Exchange Commission, but has not yet become effective. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state. A prospectus may be obtained by directing communications to Gliatech Inc., 23420 Commerce Park Road, Cleveland, Ohio 44122, telephone (216) 831-3200, telecopy (216) 831-4220, Attention: Investor Relations. ADCON® STATUS The Food and Drug Administration (``FDA'') has recently identified the key steps necessary to reintroduce ADCON®-L in the U.S. markets and ongoing regulatory matters related to the Company's Application Integrity Policy (``AIP'') status. The FDA has recently indicated to Gliatech that it may resume marketing of ADCON®-L in the U.S. provided the following conditions are met: Gliatech submits an acceptable Corrective Action Plan (``the Manufacturing CAP'') for the manufacturing changes arising out of the recall of ADCON®-L in January 2001; the independent re-evaluation of the magnetic resonance imaging (``MRI'') data from the U.S. clinical study demonstrates ADCON®-L to be effective; and an inspection by the FDA verifies the implementation of the Manufacturing CAP. Gliatech is currently preparing the Manufacturing CAP for submission to the FDA in September 2001. The independent neuroradiologists have each independently read the MRIs and the data analysis process has begun by our independent clinical research organization. This MRI re-evaluation is expected to be provided to FDA and to us by the clinical research organization by approximately the end of September 2001. Separate from the steps related to the reintroduction of ADCON®-L in the U.S., in July 2001, an 847 patient multi-center retrospective evaluation of ADCON®-L for inhibition of post-operative peridural fibrosis following spinal root decompression was completed on our behalf by an independent third party research organization. The Company believes that the preliminary results from this evaluation indicate that the incidence rates of adverse events in this study were generally consistent with those seen in the ADCON®-L treated and the control group patient populations of our previous clinical trials for ADCON®-L. Gliatech is also working to resolve its AIP status. Gliatech believes that key elements of resolution of the Company's AIP status involve ongoing audits by Health Policy Associates (``HPA''), our independent auditor under AIP, and the Company's development and implementation of an AIP Corrective Action Plan (``the AIP CAP''), which establishes policies and procedures with respect to Gliatech's data integrity compliance activities. Discussions with HPA and FDA during the AIP process have also identified the following regulatory items of note: HPA has issued a preliminary report that indicated that, in HPA's opinion, Gliatech failed to properly file Medical Device Reports (``MDRs'') during the period of 1998 through part of 2000, but found that the Company improved its systems and procedures with respect to MDR reporting and filed MDRs appropriately during 2001. HPA has conducted audits of selected sites in the U.S. clinical study of ADCON®-L and FDA has conducted inspections and issued inspectional observations and warning letters to some of the clinical sites. In connection with the MRI re-evaluation, FDA has requested that we use a more rigorous two-tailed statistical analysis, which is consistent with FDA's current statistical methodology, rather than the one-tailed analysis used in the original U.S. ADCON®-L clinical study. In addition, FDA requested that two independent neuroradiologists evaluate the MRIs. ADCON® Solution is currently affected by the Company's AIP status. Consistent with discussions with FDA regarding the MRI re-evaluation statistical methods, we intend to modify the protocol of the study and file an amendment to use a two-tailed statistical analysis. Such modification will increase the total number of patients in the study, however Gliatech will not be able to submit an amendment until its AIP status has been resolved. (I still hold some GLIA, part from before the crash and a bigger part that I bought in the depths). Peter

To: Biomaven who wrote (4587)	8/31/2001 10:51:13 AM
From: keokalani'nui	Read Replies (1) \| Respond to of 52153

Shazzam and Peter, isn't it generally true that individual investors are not eligible to purchase many of the BT convertibles? Maybe I'm way off here. Wilder

To: Biomaven who wrote (4587)	8/31/2001 4:44:01 PM
From: schzammm	Respond to of 52153

<converts> Peter, I agree with you, there are some interesting plays in bio-converts. You mentioned Vphm, which does happen to have a 6% 2007 convertible bond selling for about $556 with a current yeild of 10.79%. Only a mad-man would own this. I have owned it for about 1 1/2 years. Vertex (vrtx) has a 5% 2007 bond selling for about $760 with a current yeild of 6.57%. The Medx bond as already mentioned is probably the best of the bunch. The Biotech stories seem to take longer to develop than originally planned so it is nice to get a return while you wait. But as you stated the analysis isn't easy.