SeeThruEquity stays an arm's length away from the small biotech firms it analyzes for investors, but gets intimate enough to discover firms that hold promise. In this interview with The Life Sciences Report, senior analyst Brandon Primack and the firm's CEO, Ajay Tandon, explain why they find this handful of small biotechs intriguing.
The Life Sciences Report: SeeThruEquity specializes in analyzing companies with capitalizations under $1 billion [$1B]. What is special about the small-cap life sciences sector?
Ajay Tandon: We cover 66 small-cap and micro-cap companies across a variety of sectors, the majority of which fall into the healthcare, life sciences and technology spaces. From our perspective, the past year was very hot for investors in this range of stocks-and also for the investment banks raising capital for the life sciences sector.
TLSR: Do you invest in the companies that you analyze?
Brandon Primack: We do not do any banking or trading in the firms that we research.
AT: Our research is completely unbiased, and we do not charge companies for it. We do host investor conferences on a regular basis. We have a conference coming up on May 28 in New York City. A lot of life sciences companies will be represented, among other small-cap sectors.
TLSR: Do you view any companies as acquisition candidates, or as companies that are going to make it on their own?
BP: We cover Tonix Pharmaceuticals Holding Corp. (NASDAQ:TNXP). We initiated on it last summer at around $4/share. It is reformulating cyclobenzaprine, a pain drug for fibromyalgia. At $4, the firm was preparing for its Phase 2 trial. It uplisted to NASDAQ. ROTH Capital Partners picked it up. The stock attracted significant interest, significant capital. It closed a $43M capital raise in January. Just six months ago, Tonix was considering a licensing agreement in 2015. Now, it has the money now to do its own Phase 2 and its own Phase 3 studies. It has accelerated the pipeline. With access to capital, the story can change quite rapidly for a biotech.
Maybe it is a chicken-and-egg scenario: Does the good news make it easier to raise your valuation, making you more resistant to being acquired? Or does the good news make a company more likely to want to acquire you?
TLSR: Excellent interview, gentlemen. Thanks.
This interview was conducted by Peter Byrne of The Life Sciences Report and can be read in its entirety here. [5/1/14]
Ajay Tandon brings more than 15 years of experience in the financial service industry, and considerable experience advising, structuring transactions and raising capital for small-cap public and private enterprises to his role as chief executive officer and director of research at SeeThruEquity. Tandon cofounded Emissary Capital, a private investment firm focused on micro-cap investment banking. Previously, Tandon served as vice president of equity capital markets at Maxim Group LLC, where he led the firm's equity syndicate and origination efforts with respect to PIPEs, registered IPOs and follow-on offerings. Prior to his role at Maxim, Tandon served as an executive for v, an analytics platform used by global and regional investment banks worldwide to help optimize performance and improve competitiveness. Tandon began his career in financial services as a management consultant with IBM Global Services, and earned his bachelor's degree from Cornell University.
Brandon Primack, senior equity research analyst with SeeThruEquity, has more than 15 years of experience in the asset management business with a focus on equity research and portfolio management. Prior to joining SeeThruEquity, Primack founded Primack Capital LLC, where he ran a structured derivative product and provided asset allocation consulting services to high net-worth individuals. Prior to that, Primack spent seven years at Allianz Global Investors, where he served as a senior equity research analyst covering healthcare and industrials for large- and mid-cap growth-oriented products. He also served as a quantitative analyst in Allianz's Structured Product Group, which focused on enhanced derivative products. Primack received his master's degree in business administration [finance] from New York University's Stern School of Business, and his bachelor's degree in economics from the University of Michigan. He has been a CFA charterholder since 2004.
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1) Peter Byrne conducted this interview for Streetwise Reports LLC, publisher of The Gold Report, The Energy Report, The Life Sciences Report and The Mining Report, and provides services to Streetwise Reports as an independent contractor. He owns, or his family owns, shares of the following companies mentioned in this interview: None.
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