Like the Pilgrims, Biota left a hostile land for the promise of the better life on distant shores. Like them, we've found hardship, and wonder if we did the right thing.
It's fair enough for hedgers to think that 2 million shares crossing in a company with only 28 million of them might mean something might happen. Like the first accumulation in a takeover bid. They have bid up the SP after the fact and we all get a little pleasant sunburst of optimism through the grey sky. Sigh.
Don't get me wrong - I have no inside knowledge. Maybe they do. But if past performance means anything, all that's happened is that we've seen Hunter Hall lighten their BOTA load again. Only they and East Hill have that kind of block to trade. And no-one ever knows what East Hill are thinking. East Hill paid way, way above these prices for their BOTA shares. Maybe they want to take Prolysis' gyrase back, and continue to play baby biotech among the spires of Oxford, and sold out of BOTA to fund it?
Nah, too Tom Clancy.
If shaking out the HH and East Hill stakes helps liquidity without dilution, I'm all for it.
Damian Lismore's year is up and he's moved onto Nexvet.
And if Hunter did sell those 2 million, I think last drinks might be called for Mr. Hill's time on the Board.
Saturday 30 November 2013
Monday 25 November 2013
Oxford is a lovely place
but Biota won't have a presence there any more.
Prolysis's gyrase program was based in Oxford, and has continued there since Biota bought it in 2010.
But no more - the company has announced it will shut it down, and presumably the whole operation in Oxford goes. Prof Errington goes from the Board to potentially no longer being with the company at all.
I don't know whether that's a reflection of the competition in gyrase programs, or an assessment of their quality. It might have to do with the purchase of a new program. But, I have a feeling it has simply to do with reducing costs. Running two labs in two relatively expensive places, and neither leveraging each other.
The unwinding of Biota's last 4 years is nearly complete.
There are a lot of senior executives who oversaw and analysed the entry into those programs who are still with the company. Prolysis, Maxthera, rhinovirus: all cost the company probably in the order of 80 million between purchase and expenditure since then (although the first two were bought with hugely overvalued Biota shares).
Some Plumb and Patti type consultants would have been useful in 2010.
Anyway, here we are. The new question becomes whether the market will value the concentration in influenza and the step progress toward registration of LANI in the US. And what and how any new program will be purchased.
Prolysis's gyrase program was based in Oxford, and has continued there since Biota bought it in 2010.
But no more - the company has announced it will shut it down, and presumably the whole operation in Oxford goes. Prof Errington goes from the Board to potentially no longer being with the company at all.
I don't know whether that's a reflection of the competition in gyrase programs, or an assessment of their quality. It might have to do with the purchase of a new program. But, I have a feeling it has simply to do with reducing costs. Running two labs in two relatively expensive places, and neither leveraging each other.
The unwinding of Biota's last 4 years is nearly complete.
There are a lot of senior executives who oversaw and analysed the entry into those programs who are still with the company. Prolysis, Maxthera, rhinovirus: all cost the company probably in the order of 80 million between purchase and expenditure since then (although the first two were bought with hugely overvalued Biota shares).
Some Plumb and Patti type consultants would have been useful in 2010.
Anyway, here we are. The new question becomes whether the market will value the concentration in influenza and the step progress toward registration of LANI in the US. And what and how any new program will be purchased.
Saturday 16 November 2013
Is this a crazy idea?
Before the crazy idea:
1. AGM outcome.
Probably the most sensible proposal didn't get up. Decreasing the shares on issue needed a majority of the shares issued to vote in favour (cos' it's a constitutional change).
Which got me thinking, why aren't all AGM proposals voted on that basis?
2. Swamp people
It was interesting to see Mangrove Partners poke an air breathing root into Biota.
As we all know, they led the proxy war against the hapless Biota to suck back more cash and improve the terms of the merger deal strongly back toward Nabi. They pitilessly gutted the deal. We were the first and second stupid little pigs and they were the wolf. They blew the house down.
Tried as I might, I couldn't find the previous status of their holding. So maybe that massive 167 shares are new.
If so, then maybe they see another undervalued cashbox.
3. Crazy Idea
Here's a crazy idea. What if Australian Biota shareholders established another company. Let's call it Ozbiota Pty Ltd (OZBI). It establishes a constitution designed primarily to increase shareholder value through representation.
Every share you hold in Biota entitles you to a share in OZBI. You sign over voting proxies over those shares to the new entity.
It elects a board.
The company raises enough capital to run. Might cost 10 cents per share to play.
It then becomes a significant holder in Biota Pharmaceuticals.
As a service to shareholders, it could co-ordinate and facilitate trading on Nasdaq on behalf of all Australian holders. Yes, sellers as well as buyers. It could assist in voting at future AGMs.
Would it work?
Crazy, huh?
1. AGM outcome.
Probably the most sensible proposal didn't get up. Decreasing the shares on issue needed a majority of the shares issued to vote in favour (cos' it's a constitutional change).
Which got me thinking, why aren't all AGM proposals voted on that basis?
2. Swamp people
It was interesting to see Mangrove Partners poke an air breathing root into Biota.
As we all know, they led the proxy war against the hapless Biota to suck back more cash and improve the terms of the merger deal strongly back toward Nabi. They pitilessly gutted the deal. We were the first and second stupid little pigs and they were the wolf. They blew the house down.
Tried as I might, I couldn't find the previous status of their holding. So maybe that massive 167 shares are new.
If so, then maybe they see another undervalued cashbox.
3. Crazy Idea
Here's a crazy idea. What if Australian Biota shareholders established another company. Let's call it Ozbiota Pty Ltd (OZBI). It establishes a constitution designed primarily to increase shareholder value through representation.
Every share you hold in Biota entitles you to a share in OZBI. You sign over voting proxies over those shares to the new entity.
It elects a board.
The company raises enough capital to run. Might cost 10 cents per share to play.
It then becomes a significant holder in Biota Pharmaceuticals.
As a service to shareholders, it could co-ordinate and facilitate trading on Nasdaq on behalf of all Australian holders. Yes, sellers as well as buyers. It could assist in voting at future AGMs.
Would it work?
Crazy, huh?
Monday 11 November 2013
Saturday 9 November 2013
First quarter 2014
The first quarter appears to show a steady course on the good ship Biota.
The loss of just under 4 million is essentially the cost of ongoing research programs, and those have reduced recently so I'd expect to see that figure drop a little further in the future.
BARDA pays for itself and almost all of Biota's general and administrative costs from the margin. As the BARDA contract spends more, there will be more paid in the 7% margin so the next year should see revenue increase.
I voted against the increased allocation to the Equity and Incentive Plan. I don't think it should have been put to us at this stage, even if I think the current management is better than the previous management.
The initial incentives offered as part of the current executive reimbursement are generous but reasonable in the context of the task ahead. But the Board should have delivered some gains for shareholders before asking shareholders to extend the Equity Incentives, especially with the proposed significant increase in the shares of the company. There hasn't been any traction in shareprice or even turnover as yet, so I think it's not the right time to dilute the capital of the company.
Speaking of shareprice, it has drifted lower again. The Enterprise Value of BOTA is under well 60 million.
The loss of just under 4 million is essentially the cost of ongoing research programs, and those have reduced recently so I'd expect to see that figure drop a little further in the future.
BARDA pays for itself and almost all of Biota's general and administrative costs from the margin. As the BARDA contract spends more, there will be more paid in the 7% margin so the next year should see revenue increase.
I voted against the increased allocation to the Equity and Incentive Plan. I don't think it should have been put to us at this stage, even if I think the current management is better than the previous management.
The initial incentives offered as part of the current executive reimbursement are generous but reasonable in the context of the task ahead. But the Board should have delivered some gains for shareholders before asking shareholders to extend the Equity Incentives, especially with the proposed significant increase in the shares of the company. There hasn't been any traction in shareprice or even turnover as yet, so I think it's not the right time to dilute the capital of the company.
Speaking of shareprice, it has drifted lower again. The Enterprise Value of BOTA is under well 60 million.
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