Provectus Biopharmaceuticals (PVCT) issued a "CEO Letter" Tuesday regurgitating all the recent spin and ridiculously unrealistic talking points about the company's experimental (but already obsolete) melanoma therapy PV-10. You should read the letter for comic relief, but if you don't have the time, here's a few low-lights worth mentioning:
1. Provectus finally acknowledges the need to raise more money soon. "In total, we have adequate funds to operate without a further injection of capital through mid-2015," the company states. Uh oh. That's a problem because the planned phase III study of PV-10 won't start until later this year. Provectus executives have insisted previously that the company's cash on hand was sufficient to fund any future PV-10 clinical work. Tuesday, Provectus finally admits what every sentient investor knew all along: Dilution -- and lots of it -- is coming.
2. A textbook example of how Provectus spins a greedy executive money grab into a shareholder win:
The Company's current cash position is sufficient to meet our obligations. In addition, management is returning $8.96 million to the Company as a result of the previously announced settlement of a shareholder derivative lawsuit (subject to a 2:1 credit to the executives, such that total actual repayment by the executives may be $1.12 million per executive) and further enhanced our strength by management's recent exercise of options.
Wow! Provectus executives must really care about their shareholders to return almost $9 million to the company. Not really, of course. A shareholder sued Provectus and its executives for granting themselves stock options and bonuses in violation of the company's executive compensation plan. A settlement of the lawsuit was reached in which Provectus executives were forced to repay the company.
3. We have an electronic data room! We're going to sell the company! We promise!
Pander. Pander. Pander.
Provectus has provided data on a confidential basis to both potential global and geographic partners for both PV-10 for oncology and PH-10 for dermatology via a secure electronic data room. We are encouraged by the number of companies doing due diligence on our technologies. For instance, we recently had a team in India meeting with potential partners and have two teams focused in China working with potential partners there.
Whenever we obtain a Memorandum of Understanding (MOU), definitive agreement or similar indication of interest from a potential partner, we will issue a press release and Form 8-K filing to notify the market. Furthermore, the strategy of the company for the benefit of shareholders is a series of partnerships followed by an acquisition of the company along the lines of Celgene/Abraxis.
mention is a nice touch.
Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback;
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