Oxford Biomedica Share Discussion Threads

[marcusl2] 07/10/2022 22:00

follicular-lymphoma


Schuster: In most cases, I use tisagenlecleucel ( KYMRIAH ) the efficacy is about the same as axi-cel but with less toxicity.

Healio: Is CAR-T achieving cures for some patients?

Schuster: Maybe. I have patients who were multidrug refractory and who are still in complete remission after being treated with tisagenlecleucel 6 years ago. I don't know whether 6 years is enough to call it a complete victory. This is certain, though: Both available CAR-T therapies are capable of achieving phenomenal response rates and durable responses. We have been blessed after all these years with these patients to have more than one effective product with manageable toxicity profiles. Patients with follicular lymphoma now have many reasons to be optimistic about their future..

[harry s truman] 07/10/2022 18:27

As I understand it then legally the directors are not allowed to trade between the end of any financial period and the reporting date.

That's the definition of the closed period and the only time they are forbidden from buying or selling.

So our executive board would be in a closed period from the 1st of Jan until the results on the 20th of April which is why there were a raft of director purchases on the 21st and afterwards.

But our board is 10 people and Matthew isn't one of them. I suspect the notice of him buying £4k worth of shares is a courtesy / formality just in case someone later claims that he might have been privy to something through his role.

In busy companies the directors are always going to know something and similarly the people who work for them. I suspect that unless they buy between agreeing a deal and announcing it then they are technically keeping within the rules, but most just don't to avoid leaving themselves open.

Perhaps one of the better reasons why they all get options?

[gareth jones] 07/10/2022 16:05

I am a rank amateur as all LTH’s know well. However, Buying a large stake in Homology, Boston MA in February? New corporate broker JPMC over the Summer, having a clause in the renegotiated finance loan including $25M drawdown facility for permitted acquisitions does to me suggest to me that OXB have things going on behind the scenes (I know there are always things behind the scenes and OXB have publicly said they are talking to a number of partners about future deals) that possibly point to things on the other side of the pond. One question, if the CIO has made a “market purchase” today does this mean we are outside a closed period and there is unlikely to be market sensitive news in the near future? I have asked similar questions before, apologies if I repeat myself.

[dominiccummings] 07/10/2022 15:53

Looks like the share price will run to form: Good RNS; share price rises during morning; closes down!

[harry s truman] 07/10/2022 15:52

I'm wondering now if Homology is about to be taken over and OXB have been given a nod (see the last paragraph of this section copied from the prospectus below). 3 years have to elapse before either party has the option UNLESS Homology changes owners:-

On completion of the Transaction, Homology, Oxford Biomedica US and Oxford Biomedica Solutions will enter into the LLC Agreement in relation to Oxford Biomedica Solutions, which, among other things, will set out the ongoing rights and obligations of Homology and Oxford Biomedica US with respect to the governance of Oxford Biomedica Solutions. Pursuant to the terms of the LLC Agreement, at any time following the third anniversary of completion of the Transaction:

* Oxford Biomedica US will have the option to purchase from Homology all of its ownership interest in Oxford Biomedica Solutions (the “Call Option”); and

* Homology will have the option to require Oxford Biomedica US or Oxford Biomedica Solutions to purchase all of its ownership interest in Oxford Biomedica Solutions (the “Put Option”).

The purchase price payable by Oxford Biomedica US or Oxford Biomedica Solutions on exercise of the Call Option or the Put Option will be equal to the amount Homology would be entitled to receive upon a liquidation of Oxford Biomedica Solutions assuming all of the assets of Oxford Biomedica Solutions are sold for a purchase price based on a valuation equivalent to a multiple of 5.5 times the revenue of Oxford Biomedica Solutions over the twelve months prior to the date of exercise. In addition, the maximum purchase price payable by Oxford Biomedica US or Oxford Biomedica Solutions on exercise of the Call Option or the Put Option will be capped at US$74.1 million (£55.4 million).

Additionally, upon a change of control of Homology, Oxford Biomedica US has the right to purchase all (but not less than all) of Homology’s interests in Oxford Biomedica Solutions for the same purchase price payable on exercise of the Call Option or the Put Option, except that, on a change of control of Homology occurring within one year of completion of the Transaction, only Oxford Biomedica Solutions’ revenue from the date of completion of the Transaction to the closing date of the change of control transaction will be included in the calculation of the purchase price. The purchase price payable for Homology’s interests in Oxford Biomedica Solutions is subject to the same maximum price as described above.

[harry s truman] 07/10/2022 15:28

Effham,

We are into the Donald Rumsfield speech territory here ("because as we know, there are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns—the ones we don't know we don't know.").

I honestly can't think of any other likely purchases of such a size (than the remaining 20% of our Boston business) but this really all depends on how ambitious OXB now are.

You may remember this but for the covid vaccine work, we had the knowhow and the cleanrooms and the staff, but none of the huge 1,000 litre bioreactors. Those were diverted from an order previously in place for the old VMIC facility.

I previously thought they were still on loan but Plutonian remined me that in the results last year we had paid the £3.8m cost to make the loan a purchase.

So if 3 x 1,000 litre bioreactors (and ancillaries) cost us £3.8m then I'm guessing that the 2,000 litre bioreactors for Boston will be quite a bit more expensive.

Remember what Stuart and Roch talked about when we bought the share of the Boston facility? Basically that it came with 3 x 500 litre bioreactors but they had proved scalability to 2,000 litre which would give big economies of scale.

So if they buy the last 20% from Homology for $32m (or similar) then kitting the fallow part of Boston with these might be very expensive up front, but very lucrative over time.

It may also just be a contingency (the option for the extra credit line) because they will never drop anywhere near to a level where people start worrying about the cash at hand, but they may have big plans.

Difficult to say, but I would imagine that the £58m due in from the sale and leaseback of Windrush Court would cover an awful lot of equipment ordering.

[gigabit] 07/10/2022 14:12

They have no choice in the matter. Homology holds a put option which will force OXB to buy them out within the next couple of years whether the OXB management wants to or not. And given Homology's fragile cash situation they certainly will exercise that. It's part of the poison pill that the deal effectively put in place.

[effham_hall] 07/10/2022 14:08

"The Company also has secured the option, subject to customary conditions and available for a three-year period, to drawdown a further US$25 million from Oaktree to fund certain permitted acquisitions."

Certainly sounds like they are going to buy out Homology's interest at some point?

[dominiccummings] 07/10/2022 10:57

The market clearly likes the refinance arrangements stocky

[badger60] 07/10/2022 10:48

Nice to see OXB diversifying into the loan and property leaseback business.The Group is in the process of part-repaying and refinancing the $85 million Oaktree loan facility taken out in March 2022 and a process is underway for the sale and leaseback of the Group's Windrush Court facility in Oxford.I hear that the OXB management is considering leasing mutts from Hartlepool (building optional). Must have something to do with malaria?

[tuco 1] 07/10/2022 10:26

Maybe I was a few days early on the "Coiled Spring " !
Tuco.

[harry s truman] 07/10/2022 09:34

Interesting.

I honestly expected the £58m from the sale and leaseback of Windrush Court before this.

There is a question here which seems to have a very likely "elephant in the room" type answer, which I'll get to in a minute.

They told us at the interims that our cash balance was £115.8 million at 31 August 2022 with net cash at £42.1 million at 31 August 2022, the difference between the two there being the outstanding Oaktree loan?

With Stuart's speech about us being very nearly breakeven in this half (after the big spend in H1), and with another £58m due very soon, then they could have obviously paid the Oaktree loan off but didn't.

It looks like they will have paid something like $40m to Oaktree to bring the loan down to $50m over 4 years and cap it at an interest rate which is very close to the real inflation rate.

So, even though I don't like Oaktree they seem for once to have been very fair and done this for OXB at a time when banks just aren't lending money. That agreement was doubtless helped by OXB being awash with cash, due more and swiftly returning to profitability after the big spend in Boston earlier this year.

The market obviously likes the stability of the smaller loan over 4 years too, although to my mind our net position this morning is very little different than yesterday, but that's the market for you.

Back to my opening question of why, and surely the odds on favourite here is that they have seen the amount of AAV work in America and are going to go for the 20% of the Boston plant which Homology still own?

I'm pretty certain that Homology and OXB both have the right to trigger that, which would cost us about $35m I think and then of course the price to kit out the fallow areas in a similar fashion to the plans for OxBox.

That would be my guess anyway.

[badger60] 07/10/2022 08:45

Just what OXB wants...an extension of the Oaktree Loan. Obviously not enough revenue anticipated over at least the next 4 years to pay it off.Soon it'll be that everything is either loaned or leased. Still looking for Harry's 50 Mio quid sale/ leaseback....Perhaps that's due to be RNSd later.I wonder what they'd get for selling and then leasing Diggle back?"Under the terms of such refinancing, the Company has partially repaid the outstanding amounts under the Short-Term Loan Facility and amended the facility into a new senior secured four year term loan facility provided by Oaktree in a principal amount of US$50 million (the "Term Loan")."

[stocktastic] 07/10/2022 08:15

"The Company also has secured the option, subject to customary conditions and available for a three-year period, to drawdown a further US$25 million from Oaktree to fund certain permitted acquisitions"

I think most would prefer OXB to be paying off the loan and its draining interest rate

[pharmaboy3] 07/10/2022 07:17

We've renegotiated Oaktree loan.Oxford Biomedica PLC - Amendment of Short-Term Loan Facility #OXB @OxfordBioMedic HTTps://www.voxmarkets.co.uk/rns/announcement/b70f2b40-0268-4625-8368-a903456a0d58 #voxmarkets

[bountyhunter] 07/10/2022 07:14

up to 10.25%!
...but with some debt cleared

[badger60] 07/10/2022 06:18

Happy LSE OXB posters

Hi Kern21 Sep '22

Hard to see where this will stop let alone turn around. Having looked at the Interims again good news is well hidden if there at all. The much vaunted undisclosed projects are peanuts, which is why they probably didn't put a monetary value on them at the time and the Covid boost has disappeared leaving us with what?
A few on here, including me, have said about the negative aspects of sale and lease back as it looks as a method to improve cashflow and potentially to keep the lights on.
After 18 years of being in OXB it is disheartening and indeed sad that it has come to this.

[harry s truman] 06/10/2022 19:37

Catch, you would be surprised. Yes a busy day, but not for this. 3 of those posts are just copy and paste from a running record I keep for myself.

The other as always was just my thoughts and fortunately I can type pretty quickly.

I have it in mind, but I can't remember from where, that we currently have 7 production suites with MHRA licences to make either trial drugs or an approved product.

I honestly can't say how that is split across Harrow House, Yarnton and OxBox, but that number can't include the fallow half of OxBox and I'm unsure about Windrush Court since the managers moved out and they made the most of the space there.

I say this because I remember when we signed the Cystic Fibrosis agreement with BI for research, they said that some of the vector would be made at Windrush Court, which surprised me and is why I remembered it.

Back to the story here and back when we were on Process A (adhesion cell lines) that apparently is an open process and so you can only do one thing at once in a single clean room production suite, at the end of which everything is deep cleaned and you can then do something else.

With Process B (bioreactors) and then all the following processes since, these are closed processes which can't cross contaminate and they can put 2 bioreactors in each production suite.

So aside from the efficiency improvements of the later processes they can also do twice as much simultaneously.

If we can agree on a minimum of 7 production suites in Oxford at present (and I'm pretty certain that is the minimum of what we currently have available) then there is potential to run 14 bioreactors (I don't think there is space for more than 2 in any suite).

So 14 bioreactors available for work before we have to look again for more capacity and this of course is before the second half of OxBox comes onstream.

We made the 100m+ doses of the AZ covid vaccine in 3 of the large bioreactors. One of those now likely being the same one which serum has reserved.

I realise that you will have twigged long ago where I'm going with this, but it's to add to my earlier point that we made a small fortune in just over a year running 3 bioreactors at a less than commercial charge out rate.

You appreciate that we have bioreactor sizes to suit need and batch size, but Roch said that there are people out there desperate for vector (I'm sure you listened to the same webcast) and that we not only have the ability, but also the capacity.

It makes us very desirable and all that our customers have to do is simply agree to pay - on undisclosed rates (otherwise it's like publishing a price list).

I think that the more bullish analysts (like Joe) twigged this a long time ago and realised that in the medium term here OXB is like a mini-Lonza, or more specifically a mini-Lonza specialising in vectors.

I find it inconceivable that Roch and Stuart would get the backing of the full board, then the major shareholders, to move into AAV, spend our windfall, raise some more cash and get the credit line if the business case / market share wasn't compelling.

Perhaps worth mentioning here that the Boston facility is very near to the size of OxBox and can be configured in whatever way the business and future demand takes them. I got the distinct impression that Homology only used a small part of it in their development work up until the joint venture.

I'm happy to be corrected on this but I don't see any reason (if there were some kind of future capacity constraint) that business from one location couldn't be done elsewhere - i.e. if Boston had too much AAV work before the future suites were completed then I'm sure that could be done in Oxford bioreactors and so on.

I can't project up from 3 bioreactors on a less than commercial rate to 14 at commercial rates, not least because they are all different sizes and the large covid vaccine bioreactors had maximum continuous utilisation, but the fact still remains that although we have about 18 non-covid lines for vector work on our pipeline page, an awful lot of that will be lab / development / support work which leads up to the use of a bioreactor for a finite amount of time to make the trial batch, following which there is a deep clean and new consumables (the liner and such) and the next month it is ready for more work.

I'm pretty certain that in the post AZ covid work phase, our only customer for regular repeat work is Novartis for Kymriah which can now be done in just one bioreactor as they don't need to use Process A (adhesion) anymore. I'm sure you remember the joy that caused our constructive criticism team when they thought that RNS meant that Novartis weren't going to need LentiVector anymore.

That was of course as true as the rest of the thrown mud but unfortunately some does stick.

Perception is a big problem for us at present and the stock market currently has its head in the sand, but with every new contract signed then little by little OXB will make the current market view of them look ever more ridiculous.

[catch007] 06/10/2022 17:43

Busy day for you Harry and some great points in your posts. In the current climate nothing moves the dial more than cash at present. We know that the vast majority of OXB partner deals are structured with royalties & manufacturing payments these will be very significant in time as volumes push the hockey stick effect however this scenario is still developing. A new deal including a large upfront visible cash payment with a blue-chip pharma partner would steady the ship, so to speak. It's on my wish list for the coming months ahead and we have tremendous pipeline opportunities.

[harry s truman] 06/10/2022 13:31

I've a feeling this was posted a while ago, but the Americans are due to do a show and tell on Tuesday:-

Oxford Biomedica Solutions to Present Company Capabilities & Its Platform at Cell & Gene Meeting on the Mesa and European Society of Gene & Cell Therapy



75 minute slot seems a long one to me, but maybe it's just the (following) poster sessions where they get 15mins and then it's cut off?

[harry s truman] 06/10/2022 11:46

Appreciate that Tuco, thank you.

I'd be the first to admit that I don't understand the OXB science in anything more than the most general terms, and I think that's true for most of us here.

However I do read their stuff which is aimed at shareholders and I do know that our large shareholders have expert advisors who understand the detail. I remember the guy from Novo Nordisk saying just how long they looked at OXB and in what detail before they committed and of course they have added since and were a big supporter of Boston.

Serum saw what we did (and could do for them) during the pandemic and on the back of it bought £50m worth of shares then reserved one of our bioreactors for 10 years.

To me these are and have been reassuring signs that people with much better information / knowledge than me want to be in on OXB.

Perhaps the biggest sign for me was Roch buying a lot of shares with his own money once the results were announced and the closed period for directors was over. We could argue that nobody knows this company or its prospects better and he bought in very bigly, as someone once said.

[tuco 1] 06/10/2022 11:05

Harry well said in your post 4004.
You are on the money here .


Tuco.