Listen to our latest Investing Matters Podcast episode 'Uncovering opportunities with investment trusts' with The AIC's Richard Stone here.
And by the way, for those questioning why we raised now and not after the P1a read out, I think the answer could be fairly simply. If Launch Dx was viewed as the best strategic fit, with a wider strategy reliant on this first Aquisition (with this view a 'year in the making') perhaps Avacta did not wish to risk the losing out on the Launch DX Aquisition pending finalization of P1a / higher share price / license deals.
Also from the RNS:
The funds raised pursuant to the Fundraise will also provide Avacta the balance sheet flexibility to 'continue to execute an M&A led growth strategy' for its Diagnostics business, 'invest in those acquired businesses' to drive growth, and to provide working capital for the wider Avacta group.
I wonder what acquisitions are going to follow.
I think we are now entering a very exciting period on the Dx front (which was all but written off by many...including me) in addition to the Therapeutics front
With yesterday's unexpected news being the 'first step' in ‘an ambitious M&A led growth strategy' that has been a 'year in the making' I think we can expect more news to follow. What gives Avacta the confidence to commence this ambitions ‘M&A led strategy’ ?
With established distribution secured, it will be of key interest to see which products we now launch/leverage through this channel. There would appear to be a much a larger strategy at play with much of the details not yet known.
With good AVA6k data leading to further significant incoming funds (cold be multiple deals), it would be the perfect time to commence an M&A led Dx growth strategy!
This is a seriously exciting times to be holding this share.
Alastair Smith, Chief Executive Officer of Avacta, commented:
"This acquisition will add an established distribution channel to Avacta with three decades of customer relationships and deep market knowledge to drive future product development, strategy and growth. It is the landmark first step in our ambitious M&A-led growth strategy for Avacta's diagnostics division that has been a year in the making.
"Our vision is to build an integrated, differentiated, global reach IVD business serving professionals and consumers, that uses the benefits of its Affimer® platform to differentiate immunodiagnostic products in a competitive market. This is a transformational moment for Avacta Diagnostics, adding a well-established route to market for existing and future in-house and acquired products in the UK and across several key European markets.
AS did state that the launch Aquisition was a 'first step' of an 'M&A led' growth strategy building an 'integrated' Dx IVD business. This language suggests there is more to follow.
perhaps with incoming funds from AVA6K deal, we will continue with this M&A led growth strategy with this Aquisition being the first of many!!
Exciting times
It is the landmark first step in our ambitious M&A-led growth strategy for Avacta's diagnostics division that has been a year in the making.
"Our vision is to build an integrated, differentiated, global reach IVD business
Avacta is not presenting the pre clinical 'data' they will be presenting the pre clinical 'development' of AVA6k. I believe they are about to showcase how they achieved FAPa activated chemo
According to the presentation title AVACTA/FM will be there to present the pre clinical development of AVA6k 'as a FAPa targeted chemo agent'
It would be extremely odd to present the pre clinical development of AVA6k AS 'A FAPa TARGETING CHEMO AGENT' if after 400 days of clinical data the pre clinical data was proven wrong or inconclusive.
Anyone disagree ?
Imagine presenting pre clinical data covering development of ' a FAPa activated chemo agent ' that was in fact not targeted and not activating in human ??????
Would Avacta/FM really embarrass themselves on front of the leading professional industry peers so close to data release ?
Correct, we dont intend to license out our lead asset (AVA6K) with AS on record stating (pre ODD update) that it would be a mistake. With ODD now in place you can see why AS felt so strongly that it would be a mistake to license AVA6K out.
Not really sure I get where you are coming from, the incentives you mention below are to make it easier for companies to go through the trial procedures and test if the drug works against an Orphan disease at reduced business risk
Exactly why it would be a mistake to license out our lead asset !!
It would most certainly be a mistake to license out your lead asset while in knowledge that it would be subject to;
25% federal tax credit for expenses incurred in conducting clinical research within the United States
Tax credits may be applied to prior year or applied over as many as 20 years to future taxes
Waiver of Prescription Drug User Fee Act (PDUFA) fees for orphan drugs A value of approximately $2.9 million in 2021
Ability to qualify to compete for research grants from the Office of Orphan Products Development (OOPD) to support clinical studies for orphan drugs
Ice cool
STS tumour type was always going to be selected for phase 1B based on the above incentives imo,
I disagree.
STS would not have been selected unless data for STS was the most positive. Too much at stake not to put best foot forward for phase1b. Odd is a bonus