It was announced on Friday afternoon by Schroder UK Public Private Trust (SUPP), the former Neil Woodford Patient Capital Trust (WPCT), that the IPO of Immunocore on Nasdaq had gone ahead. We were offered some tasty numbers, but are they really true?
The Daily Telegraph yesterday reported that Oxfordshire-based biotech Immunocore, of the Neil Woodford unquoted stable, has raised £60 million in a funding round due to complete before the end of this year as the company raises up to £100 million. Great news…….apart from one small detail.
And so having seen the announcement that Immunocore had signed a deal with deal with Genetech worth $100 million, having reported the good news for Neil Woodford who could breathe a sigh of relief that he could keep his wallet (full of other people’s money) I commented Still, I’m sure the $100 million will come in useful – might we now see publication of Immunocore’s FY17 results at Companies House? After all, it should have got its results in for FY17 by the end of September. One has to wonder whether the cash will be needed to get a Going Concern all-clear from the auditor
Privately held Immunocore, which forms part of the Neil Woodford estate, has announced some good news: it has signed a deal with Genetech, part of Roche Group, for the development of Immunocore’s IMC-C103C drug aimed at targeting the MAGE-A4 protein (Melanoma-Associated Antigen A4). The really good news is that Genetech is to hand over $100 million in upfront and near-term milestone payments, and upon establishing proof-of-concept there is an option to co-develop the treatment or license the treatment to Genetech for royalty and milestone payments. Needless to say, Woodford Patient Capital Trust (WPCT) rushed out a statement too...
“UNICORN HUNTERS: The Company is invested in four companies valued at more than $1 billion – Purplebricks, Oxford Nanopore, Benevolent AI and Immunocore.”
Cynical went on: WPCT used to have many more unicorns in the portfolio, Prothena and Theravance Biopharma to mention two very recent ones. I like to imagine that Neil Woodford is literally hunting them down, investing in them and then shooting them dead from point-blank range. Well, I have news: ShareProphets can exclusively reveal Woodford’s Unicorn Graveyard….
Woodford Patient Capital Trust (WPCT) held, as at 30 September, 4.95% of its gross funds in unlisted healthcare stock Immumocore. I say gross funds because WPCT has taken on rather a lot of debt over the last while – presumably because Woodford ran out of cash and still had too many hungry mouths to feed. If the entire portfolio goes a load higher then of course being leveraged is a good thing. Unfortunately, it is a bad thing if the portfolio keeps of falling in value.
Accounts for private companies such as Immunocore Limited are supposed to be filed at Companies House within nine months and thus, at October 11 2018 I wonder where the accounts for FY17 are for billion dollar unicorn Immunocore. I note on the Woodford Investment website that as at 31 August 2018 this investment accounted for 5.33% of WPCT and 0.75% of the Woodford Equity Income Fund (although I can’t see any income here!) And Woodford’s exposure here isn’t limited to just that, because the Dublin-based Malin Corporation (of which Woodford is the largest shareholder) is also on the shareholder register.
I smiled at yesterday’s announcement from Woodford Patient Capital Trust (WPCT) summarising the “summer of milestones” achieved across the portfolio as I imagine that is just buttering up the audience before the bevy of bad news hits. From my point of view, September is going to be a hellish month for Mr Woodford so welcome to ‘I-Spy Woodford’s September Hell’
Having looked at Woodford’s Equity Income Fund earlier, I will now turn to Woodford Patient Capital Trust (WPCT) which as ever, even though the goalposts keep moving, is up against its limits and with the portfolio remaining awash with cash guzzlers, I’m struggling to understand how Neil Woodford gets out of the mess.
I’ve touched on Immunocore a few times in passing as it one of the largest holdings in Woodford Patient Capital Trust (WPCT) as well as being the largest investment made by Dublin-listed Malin Corporation, of which Woodford is the largest shareholder, obvs! Well, it looks like it’s not a particularly happy ship and I wonder whether a (further) devaluation is required?
I’ve always thought it odd when investment vehicles merely take stakes in other investment funds as one ends up with duplication of fees. There is usually an investment policy limit on such stakes, not that Mr Woodford appears to be taking the limit at Woodford Patient Capital Trust (WPCT) that seriously. Why would he - rules are for the great unwashed aren’t they?
Woodford Patient Capital Trust (WPCT) recently came out with its disappointing 2017 results and thought I’d highlight a few amusing aspects to try to cheer up shareholders here and ask a few serious questions of the Chairman, Susan Searle.
In my conclusion to The Big Short series on Woodford Patient Capital Trust (WPCT), I wondered where new pools of capital could come from to keep these biotech valuations afloat now that Woodford has run out of money and I considered capital from China as a potential life-saver. Two pieces of news this week make me consider this further, one in relation to another long-term short pick of mine in the biotech fund space, namely Arix Bioscience (ARIX).
Loyal readers will know that I, like Mr Woodford, love a quiz and with my favourite week of the year fast approaching, I thought I’d run a (simpler) quiz with a Cheltenham-related prize. There’s only two questions, so I’m hoping for more than one entrant this time!
Thought I may as well stick to a theme today and look at another Woodford investment which, surprise, surprise, undertook a placing on Friday, Dublin-listed, Malin Corp. This is yet another fund that invests in the same sort of early-stage biotech plays as Woodford Patient Capital Trust (WPCT). I will touch on why it looks overvalued to me and leave you with a piece of analysis to highlight the odd incestuous world of these biotech investors not that I’m making any accusations of course.
I’m going to draw together my analysis on Woodford Patient Capital Trust (WPCT) in one piece now so that if you’ve actually been enjoying Christmas rather than reading Shareprophets, you can start here and work backwards. I will also add a few words of caution that I picked up from the book “The Big Short” itself.
Having looked at the unquoted risk and the level of debt and connected liquidity issues within the Woodford Patient Capital Trust (WPCT), it is time to look at the tricky topic of valuation policy as it looks to me as if Woodford is taking a particularly aggressive approach, albeit a flexible one, to the valuation of the unquoted stocks (almost all the fund!) that casts further doubts on the underlying NAV.