Alpha Holdings Provides Update on Opposition to OncoSec Takeover Proposal - Seite 2

 

We believe the Company can find additional financing without giving up control, particularly if clinical trials continue to go well. This is critical because this transaction effectively prevents the possibility of maximizing value if the Company succeeds in the clinical trial next year. Alpha does not believe that it is the best decision to give up on the possibility of much bigger returns, which could be realized in the near future, in exchange for $30 million, when this amount is greater than what the Company needs at this time.”

 

Q:

Why does Alpha oppose the proposed China Grand take-over?

 

A:

“In addition to giving China Grand control at a depressed share price, we are also very concerned about the out-licensing portion of the proposed transaction.

 

With this license, the Company has transferred all of its current and future drug pipelines and technology without any upfront payment, only receiving a royalty of 20% on future revenues in 35 Asian countries. This is most troublesome to me.

 

OncoSec gives a significant part of the Company’s value to China Grand under the license, whereas China Grant does not pay, and has not even determined, the value of this exchange. If China Grand does not succeed in commercialization, China Grand can simply walk away.

 

We believe if these terms were offered to big pharma companies, which have extensive global sales networks, the likelihood of success would be higher than what China Grand could achieve. We believe that OncoSec should seek a stronger licensing partner than China Grand.”

 

Q:

If the Company’s proposals for this shareholder meeting are not approved, the Company could soon use up its capital and would need to do some other financing. What are your views on this point?

 

A:

“First off, the amount of proposed capital increase is more than the Company needs.