Despite continuing negativity on the share price, today’s news is positive for Belluscura. In 3 ways:
There are well over 200,000 COPD sufferers in Hong Kong so Innomax aren’t going to be wasting any time. First distributor is signed up and there’s a ready market. The problem with Hong Kong is lack of space. That includes space in hospitals. So anything which helps get patients back home is attractive. In fact
Today’s RNS would have been an opportunity to announce funding if needed. As time continues the likelihood of any such announcement decreases
Production of Discov-r begins - that tells us that its design is finalised that the production plan is finalised, and back orders can start to be fulfilled. The fact that we have arrived at that announcement without need for funding suggests - again - the likelihood diminishes.
Remember, I previously in BELL-under estimated no recognised sales of Discov-R in Q3. And production coming on line “part way through Q4” so only 1500 produced/sold in the US and only 375 in China. Looks like instead they now 96 theoretical days of production till Jan 1st. - so ahead of my assumptions.
Even if today’s “initial” production only means 500/month at each location then the impact on cash flow is +£0.3m (the last column below) to put closing cash at £1m.
I previously said it’s a close run thing, but the odds improve every day that there’s no announcement since the business is now cash generative and can liquify its large inventory holding as well as ask for proforma to distributors happy to jump the queue.
Singapore adds a further 88k COPD sufferers. Macau 78k sufferers. China another 100m.
Ignoring China aside for a moment, on working on a forecast $250 per Discov-R, and a revenue share of 10% of RRP this represents an addressable market worth $91m or £75m in PROFIT SHARE to Belluscura’s BOTTOM LINE. That’s excluding the Royalties from Innomax, excluding China and excluding the US operation to sell in to US, Europe and ROW.
That’s one and a half times BELL’s market cap today of £49m!