Ownership matters; and Short Game vs Long Game

There was a significant cross of 1 million shares this week, and a slight momentum in the share price followed. My bonehead analysis is that market insiders knew who the buyer was and were pleased. If not, the fact a current holder was selling a million would have caused the price to drift south. There have been 2 significant share crosses in the last weeks.

But I see no new notices regarding ownership. So, while I'm waiting, I thought I'd quickly summarise the current ownership profile to the best of my knowledge.

Hunter Hall owns 3,267,905 (11.6%)
Landon Clay and East Hill own about the same (11.3%)

For some reason neither appear in the institutional ownership summary in nasdaq

Nasdaq reports the remaining institutional holdings owning 10% between them: these include Dimensional, 683 Capital, Gabelli, Rennaisance, and Towerview in the top 5. Aside from Dimensional who have sold a few, the rest have been steady holders.

That puts significant institutional holdings at about 34%.

Problem is that almost all of those institutions hold shares as a result of their holding in the pre-merger entities: HH and East Hill in Biota, the rest in Nabi. And, if we're being accurate, East Hill came on the register via Biota's purchase of their gyrase program, although they did buy more Biota afterwards.

I guess the other issue is that these funds haven't been in the market at sub-3.50 either.

Let's wait and see who's either joined us, or left us, in the last few weeks.


LONG GAME VS SHORT GAME

Hunter Hall and East Hill have played the long game and lost. They continue to play the long game. Like most of the rest of us. But as Galbraith said "In the long run, we're all dead". Even if BOTA comes good, as we hope it does, the sunk opportunity costs have been tremendous.

If the short game is buying programs, it will be more of the same: Biota keeps buying assets that lose cash, generate no value, while the long game on influenza gets further away. Starting their Phase 2 last winter, rather than this winter, would have made a tremendous difference to the LANI program.

What Biota haven't been able to do is play the short game: sell programs or sell deals to develop their programs. That's the short game that gets investors excited and gets share prices moving. They bought the gram positive program and it's dead. They couldn't or wouldn't sell their Hep C program when it might have been worth something in the midst of the Hep C gold rush 2 or 3 years ago. They let go of influenza rapid diagnostics long ago, when that would have now been an excellent cash earning adjunct to their long game.

They have the following assets to sell while playing the long game:

Gyrase/gram negative
Rhinovirus
RSV

They should sell these programs or deal these programs, while we sit in LANI's waiting room.

And the other great short game strategy: do the Rest of World deal on LANI. Announce it. Then we can wait with some certainty about the outcome, and the analysts can do their sums on incomes.