TSN - The Sustainable Nutrition Group

Just joined and I'm surprised there's no thread on ACL!

Been a shareholder since August 04, and it's been an interesting ride.

The company shows lots of promise, and I thought the SP would be higher after the recent announcement about the positive Hycamp Phase II trials.

Partnered with Dr Reddy's after agreement with Abraxis Pharm was cancelled.....

What will happen next?

welcome aboard elinico...you will find that this site is quite good

I own ACL for a few months now and thought that they would have gone higher after the recent ann. IMO market is waiting for their mtng with FDA to see whether ACL can shorten the process. A good read for you on ACL can be found on intersuisse website

Thanks for the welcome and fast reply!

Hopefully some more discussion will be generated.

Let's hope all goes well with the FDA! Apparently HyCamp could end up an improved alternative to Irinotecan 2 (pfizer), which is a $900m a year product. The prospect of market exclusivity for pfizer wouldn't go unnoticed either.....

I also can't help but think that the resource sector is againing attracting money away by bios.....

ACL is another bios without gerneating income at this point in time + the rumours of capital raisings on the way rightly or wrongly...

Great story attached to ACL but to the market it is just under the radar

I thought more guys would be trading this stock but there is very little volume, its been up and down like a yoyo last few months so looks to me like a good trading opportunity there at the moment. Anyone got anythoughts on this subject?

Now news in the past few wks about their next step or outcome with FDA. IMO there is the usual June selloff...punters may comein after June or if there is any positive ann before that ....
I HOLD

Those rumours of capital raising probably have caused some spookage

If they release some positive news before news of capital raising, then the price will go back up.....

If they do do some capital raising then I will increase my holdings provided the discount is good and the sp doesn't dilute too much

I await the FDA results


IMO DYOR

in trading halt. most likely a cap raising around .85c to .90c. Wonder what this will do the sp. Hopefully they have some more good news with the cap raising ann

Yes, if this is a cap raise let's hope they release some good news with it or I fear the sp could get belted.

Been a long time since any good news about generic heparin has been released.


IMO DYOR

Then again, is it common for a trading halt to occur with an announcement of capital raising? I've never seen one.........


IMO DYOR

Just read it more closely

"pending an announcement in relation to an institutional equity capital raising"

Doh

IMO DYOR

Is anyone else on board this one? I reckon its got potential for a 5 or 10 bagger...I bought in 2 weeks ago and its up 30% so far.

Has come up a bit lately, and had higher volume...will watch this i think.

Don't know anything about this company, will do some research.

Trav

Any guesses as to what the current trading halt is about. Its either very good news or very bad

Good: FDA ANDA approval signed off and start selling Fondapainux and pull in $30M per an. royalty from Dr Reddy; or

Bad: FDA have a problem with the Alchemia/Dr Reddy product and go back to start.

Alchemia don't have the cash to hang around much longer unless they get revenues in or raise cash from shareholders.

I hope the news is good!

Disclose: hold heaps of ACL

Good news today! ACL announced the filing of the ANDA for Fondaparinux with the US FDA and came out of the trading halt. Closed over 30% up and a turnover close to 3,000,000. Its a long time since that amount has changed hands.

Unless the ANDA has been poorly prepared by Alchemia/Dr Reddy's it shouldn't take more than 6 months to be approved under FDA processes for first generics. They can then start marketing and selling.

There is very little reason not to expect an even greater price spike then.

Discl. Holding ACL

The recently released ACL investor presentation gives a clue to the true value of a de-risked Alchemia (see slide 11):

1. It is estimated that the Innovator drug, GSK's Arixtra, will have USD250 to $300 Million sales in CY 2009.
2. The first generic (e.g. ACL's Fondaparinux) typically gets 40 to 50% of market at a 20% discount.
3. Using USD250M and 40% of market gives Fondaparinux sale revenue of US $100 mill to divide between Alchemia and Dr Reddy's.
4. Alchemia's share of profit is expected to be between 30% and 35% of generic sales which, if you take 30%, equates to US $30million = Aus $42million (0.70 exchange rate).

All based on the conservative figure of the ranges given.

5. The number of shares and options on issue - 166 million.
6. Therefore potential annual earnings per share = 42/166 = 25 cents per share based on this conservative case scenario.
7. That 25 cents is pretty much without any "cost-of-sales" (almost all profit to ACL) as that is incurred by Dr Reddy's.
8. Using a middle of the road scenario the annual EPS from Fondaparinux = 35 cents

The risks:
1. FDA knocks back the ANDA (why did APP pull out - investors don't really know).
2. FDA delays the OK. ACL have taken their cash burn to the brink and need cash inflow by the end of this year to avoid raising more - not a good market to be doing that!
3. Another generic could enter the competition - however, ACL seem to think that's unlikely due to the synthesis complexity and their patent protection.

Upside:

1. Sales for low molecular weight synthetic heparin (GSK's Arixtra) are increasing all the time. 2010 sales will be better than 2009s.
2. ACL has other blue sky IP in the pipeline
3. Cash from Fondaparinux sales will give them huge cash resources to further exploit their VAST system. Maybe even pay dividends to shareholders!

I believe the upside makes the current price of ACL look far too low. Will be buying on retreats. Buying and holding. Reckon it’s worth more than $2.00 once fully de-risked. Recent weeks has seen a marked increase in turnover.

It will take off once the FDA approval comes through in about 6 month’s time.

Sorry, realised I'd missed out a component of the analysis, namely Alchemia's advice that generics sell at a 20% discount to the innovator drug. However, I cannot find the edit button to fix the previous post (why doesn't it show?)so here's a corrected analysis:

1. It is estimated that the Innovator drug, GSK's Arixtra, will have USD250 to $300 Million sales in CY 2009.
2. The first generic (e.g. ACL's Fondaparinux) typically gets 40 to 50% of market at a 20% discount.
3. Using USD250M and 40% of market and applying the 20% discount gives Fondaparinux sale revenue of US $80 mill to divide between Alchemia and Dr Reddy's.
4. Alchemia's share of profit is expected to be between 30% and 35% of generic sales which, if you take 30%, equates to US $24 million = Aus $34million (0.70 exchange rate).

All based on the conservative figure of the ranges given.

5. The number of shares and options on issue - 166 million.
6. Therefore potential annual earnings per share = 42/166 = 21 cents per share based on this conservative case scenario.
7. That 25 cents is pretty much without any "cost-of-sales" (almost all profit to ACL) as that is incurred by Dr Reddy's.
8. Using a middle of the road scenario the annual EPS from Fondaparinux = 28 cents

The risks:
1. FDA knocks back the ANDA (why did APP pull out - investors don't really know).
2. FDA delays the OK. ACL have taken their cash burn to the brink and need cash inflow by the end of this year to avoid raising more - not a good market to be doing that!
3. Another generic could enter the competition - however, ACL seem to think that's unlikely due to the synthesis complexity and their patent protection.

Upside:

1. Sales for low molecular weight synthetic heparin (GSK's Arixtra) are increasing all the time. 2010 sales will be better than 2009s.
2. ACL has other blue sky IP in the pipeline
3. Cash from Fondaparinux sales will give them huge cash resources to further exploit their VAST system. Maybe even pay dividends to shareholders!

I believe the upside makes the current price of ACL look far too low. Will be buying on retreats. Buying and holding. Reckon it’s worth more than $2.00 once fully de-risked. Recent weeks has seen a marked increase in turnover.

It will take off once the FDA approval comes through in about 6 month’s time.

Great analysis Gambier, I now understand a lot more about their drivers and product.

I acquired a small holding as my bio exposure based upon a mix of a little understanding and instinct at 15 cents and have been more than pleased with their performance.

I will be watching for the provisional results of the ANDA submission and increasing my exposure if these are positive.

Cheers

Hi hardyakka,

Thanks for the feedback. I thought I was talking to myself about Alchemia. I had gotten really excited to find an Alchemia thread on the Aussie Stocks but the earlier posters look like thier interests may have moved on to other stocks.

Since my first post on 29 May 2009, ACL has increased in value from around 29 cents to 36 cents at close of business last Friday. Daily volume has eased following the initial highs on news on the ANDA filing. I'd expect volume to continue to be light until more announcments are made. With only 166 million shares on issue, there isn't a lot floating around anyway. I'm still happy to sit and wait for the FDA's advice on the approval in about 5 months time. Got my fingers crossed that the $2 target is then realistic.

Cheers, gambier

Discl: holds ACL

I'm suprised no one has posted on this thread in months. I have been holding ACL a while now, expecting some decent news any day now. Good news could see this one take off IMO