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  • Tonix Is Fully Funded 13 comments
    Nov 26, 2013 12:12 PM | about stocks: TNXP

    So why did they file the S-3? Now seems as good a time as any to prepare for plan B. CEO Seth Lederman has said that the final trial will cost about $24 million to run and their first preference is to partner after the current trial is finished in October (with the partner funding the final trial). Plan B is to go it alone and go to the capital markets to fund the last trial. They've repeatedly said that is not their first choice, and they have the money to complete the current 2b trial, but the prudent thing is to prepare for both contingencies (bold is Tonix emphasis not mine):

    "We may offer and sell, from time to time in one or more offerings, any combination of common stock, preferred stock, warrants, or units having an aggregate initial offering price not exceeding $50,000,000. The preferred stock, warrants, and units may be convertible or exercisable or exchangeable for common stock or preferred stock or other securities of ours.

    Each time we sell a particular class or series of securities, we will provide specific terms of the securities offered in a supplement to this prospectus. The prospectus supplement may also add, update or change information in this prospectus. You should read this prospectus and any prospectus supplement, as well as the documents incorporated by reference or deemed to be incorporated by reference into this prospectus, carefully before you invest in any securities. This prospectus may not be used to offer or sell our securities unless accompanied by a prospectus supplement relating to the offered securities."

    But Tonix is fully funded and said as much twice in the third quarter 10-Q filed two weeks ago, which is consistent with what they've been saying since they raised more than $10 million in August (bold is my emphasis):

    "The Company's primary efforts are devoted to conducting research and development for the treatment of CNS diseases. The Company has experienced net losses and negative cash flows from operations since inception and expects these conditions to continue for the foreseeable future. The Company does not have any commercial products available for sale and there is no assurance that if approval of its products is received that the Company will be able to generate cash flow to fund operations. In addition, there can be no assurance that the Company's research and development will be successfully completed or that any product will be approved or commercially viable. Management believes that the Company has sufficient funds to meet its research and development and other funding requirements through at least September 30, 2014...Our future capital requirements will depend on a number of factors, including the progress of our research and development of product candidates, the timing and outcome of regulatory approvals, the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing patent claims and other intellectual property rights, the status of competitive products, the availability of financing and our success in developing markets for our product candidates. We believe our existing cash is sufficient to fund our operating expenses and capital equipment requirements for at least the next 12 months. "

    So I think we have some responsible prudence by management with the S-3 filing. They don't need funding at this time, after phase 2b results they can partner or use this S-3 filing to fund the final trial.

    Disclosure: I am long TNXP.

    Stocks: TNXP
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Comments (13)
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  • Joe, thanks for posting this. Appears to be a lot of confusion here about what an s3 is. If you read the filing it's pretty self explanatory.
    26 Nov 2013, 12:21 PM Reply Like
  • Yes, thanks Joe... and Kenser who explained it briefly to me this morning. Now I know what an S-3 is it won't rattle me next time... and it sure did rattle some investors earlier today. Long TNXP
    26 Nov 2013, 01:06 PM Reply Like
  • Hello Joe,
    Any idea what day your article on TONX will actually appear? I thought it may come out tomorrow (Mon, 12/2) given that you submitted it on Wednesday PM. Also, is it going to be for general distribution or only for SA Pro subscribers? Thank you.
    1 Dec 2013, 02:15 PM Reply Like
  • Author’s reply » Don't know thet0nzz, I hope it is Pro, it took a long time, it is 36 pages long..
    1 Dec 2013, 02:19 PM Reply Like
  • Thanks for the fast response, Joe. I am on you email list and you sent me your rough draft several weeks ago. However, I am not an SA Pro subscriber. Is there any other access to the finished product? Thank you for your hard work on this stock.
    1 Dec 2013, 02:44 PM Reply Like
  • Author’s reply » I'm afraid not...what I sent in the email wasn't really a draft of the article, the article is its own thing, I actually got much more bullish as I did more research and writing..
    1 Dec 2013, 03:14 PM Reply Like
  • BUT... I believe it will be "Pro" for 24 hours... then released to us mortals for a month... then it goes back to Pro forever. So after the pros get a day to gnaw on it and buy in... we'll get our chance. My humble advice: get a small position NOW... then read and see where we're at. You already got a peak at the draft... get some. GLTA Long TNXP
    1 Dec 2013, 06:12 PM Reply Like
  • Joe,

     

    That is what happened to me as well. I got more bullish as I kept digging. My biggest trade position is TNXP and it keeps growing.

     

    Best,

     

    D
    1 Dec 2013, 06:19 PM Reply Like
  • Thank you, Dennis. I am already in, but was unsure of the mechanics of the PRO articles. Your explanation is appreciated.
    1 Dec 2013, 08:32 PM Reply Like
  • joe whats your take on todays dilution?
    23 Jan, 08:11 PM Reply Like
  • Author’s reply » I can't blame them for raising funds buyandhold, the stock was in the 3s a few months ago.

     

    They raised a lot of money, enough to fund the final FM trial and proceed with PTSD - even without a partner.

     

    They are in the same business situation as before:

     

    "The major pharmaceutical companies are going through a patent cliff, Cymbalta and Lyrica in particular are coming off patent, and companies need to replace revenues. Tonix' management could not be better suited to making a deal, they have done exactly these kinds of deals in the past, and with the biggest players. It is management's stated preference to partner, and it would make no sense for Tonix to try to take the drug to market by itself. TNX-102 SL will be prescribed by primary care physicians, and this requires a vast sales force like Lilly or Pfizer has. Partnering makes perfect sense for everyone involved."

     

    But now they have leverage - they don't need money to proceed. So getting a fair partner deal looks more likely than ever in my opinion.
    27 Jan, 06:10 AM Reply Like
  • In my past experience with dilution $CYTR if done at the right time and for enough funding that it is not reoccurring every year it is a natural part of this business.
    When I bought TNXP i was expecting they would do this...the beauty of it is they are doing it after a 400% increase in share price. Where some companies are forced to do it when they are beaten up then the share count becomes real dilution to get the monies to move forward.
    Hell there is under 5 million share to trade now and the float is less than that.
    Pay close attention who buys the offering as this is the way the big money gets into the game...I'm guessing it will be over sold and the weak hands will fold.
    Anytime there is an offering it will be a discount to the market price so expect 12.50 based on the close today...however they didn't disclose when or what price they will do it at
    if 12.50 I'm all in especially it the funding covers both studies on their product.
    I'm in @ avg. 10.28...reason I didn't buy more is because I knew they would put an offering out sooner or later...now just waiting to see and won't buy until they announce the offering. But won't sell either.
    My biggest interest is who buys the offering...looking for and feeling like it will be the smart money.
    23 Jan, 10:02 PM Reply Like
  • I completely agree, I think there was probably enough tute interest that Tonix finally gave in. After all, how are the tutes gonna buy in when 300k shares runs up the price 3 bucks!? I'm very interested In price and who is buying.
    23 Jan, 10:07 PM Reply Like
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