Shield Therapeutics Share Discussion Threads

[best1467] 22/12/2020 16:31

NBG Slightly surprised you have been selling chunks at the levels mentioned especially 60p range I’ve sold zero since the RNS but added 3 lots.
I have had a negative opinion of the running of the company since the Removal of Carl Sterritt and it’s certainly got not get any better but investing is all about value so even with the clowns in charge I still expect a fair return from this valuation level

[kop202] 22/12/2020 16:28

For STX.....its buy right and sit tight.....there arnt many AIM shares you can say that aboutThe free float is small so a big move up in the share price is coming and all that sold will play a nice big spread to the MM for the privilege of getting back on board.....the drop was painful.....but which do you prefer share price distress of FOMO....its always the way with AIM shares

[nobbygnome] 22/12/2020 15:54

>> best

I actually bought a few back today but not sure there is any rush. You have to not get upset about these events but trade them so I sold some at 90odd straight away and then mid 80s later that day. Finally after Tim's presentation last week I sold another chunk at 60p because I detected the negative sentiment on here even though I didn't agree with it.

Now I am in buy back mode but as I say I am not in any great rush. Come this time next year this price will be seen as a bargain but sadly on Aim people are not interested in next week let alone next year.

[teddanson] 22/12/2020 15:33

We all should have run for the hills when Carl started selling just before Tim’s latest update.

Quite telling that Carl is still flogging his shares, even at this level, and - according to Companies House - hasn’t been buying shares in his new venture:

[frrinvest] 22/12/2020 15:04

Nobby is not the only one who has had a temporary setback. I suppose we are all in the same boat and no one expected the undesired outcome. We live for another day. Plenty of news to come in 2021.

[frrinvest] 22/12/2020 14:28

Thanks parc1. Interesting figure.

[frrinvest] 22/12/2020 14:26

The investment case at this price must be extremely compelling:
- De-risked (FDA approved)
- Commercial stage, USA (delayed, yes but still there very much - exec team announced if going alone), China (huge market), Europe (steadily growing)
- Large market, requires only 2% to of the USA market for big profits, though 5% market share is more realistic.
- Cash till 2022, loan facility agreed.
- Strong IP protection till 2035.
- Outside chance of a bid from a competitor or otherwise.

The two companies that have come back on the negotiation table indicates better chance for an out-licencing deal on this occasion, could be quicker as not starting from scratch.

GLA!

[parc1] 22/12/2020 14:23

frr, Loss of approx £70m has been endured from ops over the years 2015-19 to get to the point of having FDA approved product now taking european sales. It is all money invested into the company one way or another. It is a value which coincides with TW statement that same value is underpinned by China and Europe.

[frrinvest] 22/12/2020 13:52

Thanks parc1 and EKCS - I was aware of the info you provided. I was thinking more along the lines of where STX started with Feraccru - from R&D stage, pre-clinical to phase1, 2, 3 (were 3 x phase 3s ) to eventual approval with the FDA. This cost most run into tens of millions pounds. So I was trying find the cost and compare against the so lowly market value currently.

[parc1] 22/12/2020 11:47

frr, this gives some idea on the cost.

With "go it alone"

TW said 200,000 patients @ $1000 produces gross $200m per year.

After manufacturing costs and Vitra 5% royalty that leaves $180m.

So, actual manufacturing cost is 5% of sale price.

[frrinvest] 22/12/2020 11:36

Does anyone know the total cost of producing the drug?

[onceaday] 22/12/2020 11:26

Reimbursent will be the big challenge. Whoever markets the drug will need to negotiate with a multitude of private payers and government agencies to agree pricing. This is likely to take 12 - 18 months from launch.

[kop202] 22/12/2020 11:17

With an aAIM stock....who is the market.......Im assuming STX IS on SEAQ.....So the "market" is the market maker through whom deals are made.Failure is already baked into the share price imo

[parc1] 22/12/2020 11:11

The "go it alone" has some good de-risking involved.

(1) The exec team does actually have the knowledge to administer the product.
(2) All who prescribe iron are listed - down to names. It could not be better for targeting sales. Shield know who is prescribing and how much iron is prescribed.
(3) It is not down to the ability of 1 sales rep. It will start with 30 and grow. So the quality of sales ability is de-risked
(4) Obvious upside with the materially higher margin

As I have always maintained, the product is excellent. The market research has been done, finding that the product is highly desirable.

The only thing is placing required. They should get on with it. Maybe they are already in talks.

[1gw] 22/12/2020 11:10

Except that the market seemed to be valuing the near-100% chance of a deal at between 110p and 140p, based on the shareprice range before the recent announcement. So take 50% of that to give you between 55p and 70p. Given the current price, the market seems to be saying that the go-it-alone arm has an expected value of a bit less than zero (expected loss on messing up slightly exceeding expected gain on success, or alternatively probability of messing up greater than probability of succeeding).

The market is wrong, of course, but who knows in which direction?

[weatherman] 22/12/2020 11:00

SO, 50% chance of deal without fund raising, which gives a valuation of above 300p. A 50% chance of going-it-alone - assume 25% chance of making it a success, worth far more than 300p. 25% chance of screwing it up - will lead to a sale of the company - probably still worth far more than 50p. imo

[kop202] 22/12/2020 10:47

At an share price of 50 odd your money is safe.....even if they make a mess of it.....this drug will sell itself.....once the word gets round....no competition.....come on

[1gw] 22/12/2020 10:31

But the key valuation issue I think is that you've got a material risk that they do decide to go it alone in the US and so you have to build that into your valuation.

i.e. there's a probability (feels to me like about 50%) that they do a deal (relatively low risk on execution, profitable cashflows of unknown magnitude) but also a significant probability (50% if its 50% for the deal outcome) that they go it alone. The go-it-alone arm probably has 2 outcomes to model here, one where they crash and burn (big loss because of poor execution) and one where they succeed (higher value than the deal scenario).

So if before you had nearly 100% on the deal outcome, with a risked value, now you have only half that risked value from the deal arm and a risked value which could be positive or negative on the go-it-alone arm, depending on the probabilities you assign to success and failure and the costs of failure/value of success. Given the poor track record the management appears to be developing, you might feel it is difficult to justify assigning a very high probability of success to go-it-alone, and so this arm could result in a negative expected value, reducing the overall value relative to the expected value of the deal arm.

[whatno] 22/12/2020 10:25

Carl Sterritt reduced his holdings on the 16th according to the RNS just out..

[weatherman] 22/12/2020 10:17

The price fall is overdone, it assumes a dilutive large rights issue - but they have cash to last for 12 months. They could announce a US deal in that time with cash injection, or they could go it alone with bank finance and a smaller rights issue, with much larger margins - either way it seems overdone.

[parc1] 22/12/2020 10:11

Carl Sterritt sold 4% so he now has less than 3%. A big tranche out of the way.