Rua Life Sciences Share Discussion Threads

[parsons4] 19/7/2022 10:32

Good posts on here, much better than most others !! Well done all.

[aykon] 18/7/2022 18:45

Soon we will know what has been agreed with the FDA for the 510k application clinical trial…but they appear to be strongly hinting that it will be a relatively small trial with a 6 month follow up. This would imply that we may be looking at 50-100 patients. Such a trial could be undertaken for £1-1.5 million. This might also explain why they are not in a rush to raise further funds. In my opinion the fundraise is more likely to be for the heart valve project progression to animal studies. Although they have also hinted that they are looking for potential partnership or even sale of this business unit!

[bones] 18/7/2022 17:32

I’m looking forward to the cleaned up copy of today’s webinar. A whole new hour of previously unheard material. Pick up on the gems within!

[bones] 18/7/2022 16:58

ENW, you are right about the one thing underlying our investment and that is the share price discounts Armageddon currently!

I can easily make a case for each of the business divisions being worth in isolation more than the entire market value of RUA Life Sciences plc in total right now (£8M).

[langland] 18/7/2022 16:49

Ah yes....Radio Luxemburg... the nostalgia!

[early not wrong] 18/7/2022 16:33

Despite the sound quality, it was a fair update.
They can't say what they are not allowed to say, and they can't build expectation (again) before delivery, so I think it was comprehensive and realistic. There are some positives for the profitable parts of the business including the working capital cycles adjustments, growth and new contracts. This plus the Elasteon annuity business are going well in an uncertain world.

Bill has always been reluctant to get into a debate on funding, and so he was again today. They have options.

All things considered, they're making solid progress with the existing businesses whilst the new ones have huge potential when they can be de-risked. The share price represents an option on a much larger share price for those that can afford to wait.

[hannahh] 18/7/2022 16:25

Afternoon all, we were aware of the sound quality issues as we went along and tried to address them but unfortunately we were unable to. We will re-record tomorrow and circulate so you can hear the presentation more fully. Thanks Hannah

[semper vigilans] 18/7/2022 16:15

I think you are right Langland but it almost got lost in the 1960s Radio Luxembourg transmission.

[langland] 18/7/2022 16:07

The mention of a distributor sign up is important IMO and is akin to an off-take agreement.

[semper vigilans] 18/7/2022 15:46

You are right SK - I pointed out the sound problems twice to the moderator who did ask them to speak up: the quality of the microphones poor.
Subtitles next time?
Whoever organised this should not be paid and an audible version put on the website.

[bones] 18/7/2022 15:43

Most of the presentation before the Q&A is scripted to slides. In future perhaps they should get the presentation pre-recorded professionally using a seasoned narrator so that the whole piece is recorded clearly to a high standard and has consummate positivity exuding from the screen. That would ensure the best impression is given and then they can switch live to Q&A’s on completion. Only then, make damned sure the lines of communication are clear and audible for the Q&A too!

In matters of promotion like this the damage done by an amateur hour sound disaster like today and a rather humdrum presentation does not justify the cost savings by not doing it professionally.

[sicilian_kan] 18/7/2022 15:35

Yes, the sound was dire. They wouldn't have known that in the room, but the ED person who was remote should have stopped it and sorted it out. That said the Q&A had some gems:

1. Asked to update about the visit in February from one of the key players in heart valves, who was visiting them that day, the news was very positive. I didn't get the precise wording as I was distracted at the time, but something along the lines of discussions at an operational level have moved to the [corporate / management] level. And that they were exploring a flashpoint [?] in the future on something that they can be working together.

2. I also heard something along the lines of hoping to get a distributor signed up before any 510k fundraising.

3. Yes, the new contract question was illuminating, thanks bones, and next couple of months was stated I think.

So, there is quite a lot happening at the moment and there could be some good RNS's in the next 1-3 months:

- FDA agreement on trial size [and thus costs can be finalised]
- New contract
- Collaboration with a key heart valve player
- Distributor sign up

But then the sound was so bad, and I was multi tasking, so if I got any of the above wrong do let me know.

[bones] 18/7/2022 15:32

Other Q&A responses (a couple that spring to mind):

- Broker Cenkos is doing the rounds. Make of that what you will. Bill said something about talking to Amati as well given they have been a seller.

- Before any further funding options are weighed up, they need to understand what the FDA will want out of the clinical trial for the graft. Stands to reason!

[bones] 18/7/2022 15:21

On the positive side, sounds like they are hopeful of a new contract manufacturing deal for RUA Medical textile product with a new big Med-Tech Co in a couple of months (as flagged at the results). Caroline suggested this could open the door for more work as this is the first time this company has outsourced its manufacturing, so they must like what the see at RUA Medical. The good news is that this would be a solid profit making contract which could mean RUA Medical ought to be valued by itself at least the market cap of the entire group (in my opinion).

[bones] 18/7/2022 15:16

Sound quality was abysmal. The town cryer would have struggled to be heard above the interference on the transmission. The moderator should have stopped it and said they will sort it out before going on.

Consequently it was a car crash as far as any potential new investor looking in was concerned. They would have turned it off inside five minutes as nothing could be heard with both the voices lost in the crackle and pop. I’m only interested in the Q&A mainly so I persevered!

It must also be obvious that the Q&A would include questions on funding. Whilst I appreciate that those are often sensitive areas to talk about when the answer is not known, the impression given is that no answer seems to have been prepared in advance giving the impression Bill is being evasive.

These presentations should be promotional but that didn’t happen today as the sound quality was so poor.

[parsons4] 18/7/2022 15:02

Just listened to the presentation. Both Directors have very little personality, they don't get very excited about the business !!!! The main thing about the strategy I think came at the end. Boring Bill couldn't really answer the million dollar question about FUNDING. Caroline then did a much better job and explained that they wanted to get the full story from the FDA re the trials before considering how they would raise funds, and they wanted a much higher share-price. On the whole a reasonable interview with a 12 month, at least, waiting time before any fireworks. Happy to hold GLA

[sicilian_kan] 16/7/2022 02:06

[edit - wrong board!]

[bones] 15/7/2022 07:42

Last year, ED forecast less than £1M cash at 31/3/22 and it turned out to be a fraction short of £3M. Based on that track record, I will not personally read too much into the 31/3/23 forecast!

[sicilian_kan] 15/7/2022 00:08

[edited above to say 2023 rather than 2022, typo]

[sicilian_kan] 15/7/2022 00:03

hedgehog11, it is important to be clear that Equity Development's forecast for £126k is for the company's financial year end not the calendar year end, i.e. to 31 March 2023.

Yes, I agree there is likely to be a placing in Q3 but that has been known about for 7 months. Ever since the need for a clinical trial to go through the 510k process was announced last year, the need for funding at this point has been known. The share price has already reacted accordingly.

The good news this week is the amount that is needed to be raised will be much less than some of the doomsayers were stating at the start of the year. We now know that the trial will be "a relatively small clinical study". That is one of the reasons why the price has picked up a little in recent days. Hopefully more will come out in the presentation on Monday and we also have the FDA news on trial design in August, which is now only a little over two weeks away.

[bones] 14/7/2022 23:51

Thanks Hedgehog11. The final results per the RNS are, as for all companies, a distillation of what will appear in the official financial statements lodged at Companies House. This is where the full detail can be found (available soon).

The going concern statements are pretty boilerplate as are the menu of risks facing a business. They have to state every conceivable line of risk these days since it is assumed by the authorities that we, the investing public, are all schmucks. We all need our eyes prised wide open investing in this pool of risk asset!

The market is assuming a raise from a weak position may come later this year. No credit is being given for the possibility of a farm in of some kind from a major for the HV IP, for example (and it might not happen).

Like you, I am interested in what we might learn on Monday, if anything, of a significant or promising nature.

[hedgehog11] 14/7/2022 23:18

It's always good to re-read the reports. Regarding financing the final results going concern section has some not unsurprising comments, one of which 'A previous equity fundraise in December 2020 introduced new institutional investors to the Group's share register and demonstrates there is investor support for Group's business plan. The Board is confident that raising additional capital will be achievable'. Equity development forecast 126K in the bank at the end of the year so I'm expecting a fundraise in Q3 after what I hope will be a summer of good news stories (final results report has certainly dropped enough hints at that).
Other comments:
'As part of the going concern assessment, the Board and management have prepared and considered:

· Detailed financial forecasts, and cash flow requirements showing that future financing will be required

· The level and timing of the additional financing needed to support the business plan and cash burn rate '
I hope we hear more about that at the presentation.
EQ do suggest in their research note that they have costed in some of the cost of the 'relatively small clinical study' in their YE23 forecast.
There's plenty to read into in the final report and it feels like a quality leadership team is developing here.

[bones] 12/7/2022 22:07

What would definitely be positively received would be an investment in the heart valve R&D by a US device major.

The fact that there is an early stage polymer valve already being allowed for testing in man via an investigative device exemption (Foldax) should, to my mind, be causing much interest in RUA’s potentially far superior prototypes (in terms of cutting edge research and latest materials including textiles, a RUA speciality).

I get the feeling RUA are giving the heart valve a good run this time but they are more realistic in knowing they can’t keep going it alone in a twilight world of late night research iterations.

[hedgehog11] 12/7/2022 20:28

Wageslave, it's worth reading the Equity Development note Sicilian Kan shared, there's reference to the cash position which was a better position than I was expecting. The comment 'a relatively small clinical study' is an improved sentiment on previous releases, I think that the next RNSs could be positively received, but then again we have been here before.