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Buzz on the Bullboards: Stocks making headlines

Traders don’t not know what to expect coming in tomorrow’s news cycle … but you can bet the markets are going to be volatile day-to-day.
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It can be hard to know when to make a move when every day looks crazier than the last. Traders don’t not know what to expect coming in tomorrow’s news cycle … but you can bet the markets are going to be volatile day-to-day.

This has been the case in market activity throughout the autumn season so far, from highs and lows to the current wars in Israel and Ukraine, the month of October doesn’t seem to be letting up with its surprises any time soon.

That means market intensity makes for intense discussions on the Bullboards, where numerous sectors have seen new companies appear and returning businesses continue to generate a lot of discussion.

With emotional investments come emotional reactions, but with dropping temperatures, we also found plenty of cooler heads making their cases.

Small-cap investors are always on the lookout for the most current and hottest plays to capitalize on these uncertain times in the markets, while other plays which have a longer-term on gains, see less interest than they may have had in years’ past. Who came out on top this week? Who is new to the conversation? Who is ready to take their gains even further? Let’s take a dive in and find out.

We first look at cannabis and consumer packaged goods company Canopy Growth Corp. (TSX:WEED, Forum), whose cultivation facility in Kincardine, Ontario, has achieved Good Manufacturing Practice (GMP) certification in the European Union.

GMP is a widely adopted system to ensure the safety and consistency of pharmaceutical production.

The certification – issued by RP Tuebingen, Regional Health Inspectorate of Baden-Wuerttemberg – allows Canopy to continue exporting cannabis to medical markets in Europe and around the world, as well as position itself to capitalize on new markets upon legalization. The company’s medical cannabis brands are currently available in Germany, the Czech Republic and Poland, in addition to Asia-Pacific markets including Australia and New Zealand.

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Canopy has now consolidated its production down to two purpose-built sites, including its post-production facility in Smiths Falls, Ontario, as part of its ongoing restructuring efforts.

“The receipt of EU GMP certification for our Kincardine facility is a significant milestone for Canopy Growth as we complete the transformation of our business and position it for long-term growth and market leadership,” David Klein, Canopy’s CEO, said in a statement. “Today’s announcement further demonstrates our team’s proven ability to evolve our business and positions us to continue serving medical cannabis customers in Europe and around the world with high-quality flower.”

Meanwhile in the tech marketplace, Fobi AI Inc. (TSXV:FOBI, Forum) has signed a three-year contract with one of the largest membership organizations in Europe.

Under the agreement, Fobi will provide several digital services, including digital membership and client communications for up to 20 million of the organization’s members.

The artificial intelligence (AI) firm expects to generate C$1.1 million in revenue, with a 90 per cent profit margin. The revenue sources will include onboarding and setup fees, along with monthly fees for active membership passes. The company calculated this projected revenue including a setup fee of C$58,000 and recurring monthly fees from 10 million active users a month over a 36-month period.

Source: Fobi.

The European organization aims to enhance its members’ experiences by leveraging Fobi AI’s technology, such as its wallet pass platform, Passcreator, which can enable the organization to create and distribute digital membership IDs directly through the mobile wallet. This would eliminate the complexities of traditional plastic cards, such as the cost of production, fraud, and risk of loss.

“This three-year deal not only highlights the trust and confidence our enterprise clients have in our innovative solutions but also helps solidify Fobi’s position as a leading global wallet provider,” Fobi’s CEO, Rob Anson, stated in a news release. “We are very honoured to work as closely as we are with one of Europe’s largest membership organizations to deliver exceptional digital experiences to their member base.”

Finally, E3 Lithium Ltd. (TSXV:ETL, Forum) is in the green this week after completing more production tests at its direct lithium extraction field pilot plant in Alberta with positive results.

The company intends to produce lithium concentrate for downstream processing of battery-grade lithium hydroxide monohydrate, a key component in alkaline battery manufacturing.

The additional tests trialed numerous operating parameters to optimize for an extended operating period. Preliminary internal analysis and results include:

Initial lithium recovery of more than 94 per cent Concentrate purity of more than 80 per cent Average lithium grade in concentrate of 916.6 mg/L

The results indicate that E3 can decrease the cycle time, which is the amount of time the sorbent is exposed to the brine during direct lithium extraction. This modification may reduce the commercial plant’s capital and operating costs.

The company will use the test results and learnings from the past six weeks of pilot operations to set the conditions for an extended operating period, which is expected to begin next week.

Upon completion of the extended operating period, E3 will be able to proceed with its planned pre-feasibility and definitive feasibility studies on the road to building its first commercial facility.

E3 Lithium - E3 Lithium field pilot plant on August 28, 2023.E3 Lithium – E3 Lithium field pilot plant on August 28, 2023. Source: Business Wire.

“We are thrilled to be able to provide further updates on the operations of the field pilot plant,” Chris Doornbos, president and CEO of E3 Lithium, said in a statement. “The plan we put in place to test various operating parameters has proved to be effective thus far. Not only have positive results been produced under several operating conditions, we have also grown our confidence to design the most efficient processes to commercialize our vast resource.”

Following a shortened week on account of the long-weekend, next week should bring a return to normalcy. Unfortunately, with new twists affecting the markets left, right, and centre, something will always come up that throws a wrench in things. The best place to make sense of it, and to see who’s making money, is diving into the Bullboards.For previous editions of Buzz on the Bullboards: click here.

Join the discussion: Find out what everybody’s saying about public companies and hot topics about stocks at Stockhouse’s stock forums and message boards.

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The material provided in this article is for information only and should not be treated as investment advice. For full disclaimer information, click here.

The post Buzz on the Bullboards: Stocks making headlines appeared first on The Market Herald Canada.

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Four burning questions about the future of the $16.5B Novo-Catalent deal

To build or to buy? That’s a classic question for pharma boardrooms, and Novo Nordisk is going with both.
Beyond spending billions of dollars to expand…

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To build or to buy? That’s a classic question for pharma boardrooms, and Novo Nordisk is going with both.

Beyond spending billions of dollars to expand its own production capacity for its weight loss drugs, the Danish drugmaker said Monday it will pay $11 billion to acquire three manufacturing plants from Catalent. It’s part of a broader $16.5 billion deal with Novo Holdings, the investment arm of the pharma’s parent group, which agreed to acquire the contract manufacturer and take it private.

It’s a big deal for all parties, with potential ripple effects across the biotech ecosystem. Here’s a look at some of the most pressing questions to watch after Monday’s announcement.

Why did Novo do this?

Novo Holdings isn’t the most obvious buyer for Catalent, particularly after last year’s on-and-off M&A interest from the serial acquirer Danaher. But the deal could benefit both Novo Holdings and Novo Nordisk.

Novo Nordisk’s biggest challenge has been simply making enough of the weight loss drug Wegovy and diabetes therapy Ozempic. On last week’s earnings call, Novo Nordisk CEO Lars Fruergaard Jørgensen said the company isn’t constrained by capital in its efforts to boost manufacturing. Rather, the main challenge is the limited amount of capabilities out there, he said.

“Most pharmaceutical companies in the world would be shopping among the same manufacturers,” he said. “There’s not an unlimited amount of machinery and people to build it.”

While Novo was already one of Catalent’s major customers, the manufacturer has been hamstrung by its own balance sheet. With roughly $5 billion in debt on its books, it’s had to juggle paying down debt with sufficiently investing in its facilities. That’s been particularly challenging in keeping pace with soaring demand for GLP-1 drugs.

Novo, on the other hand, has the balance sheet to funnel as much money as needed into the plants in Italy, Belgium, and Indiana. It’s also struggled to make enough of its popular GLP-1 drugs to meet their soaring demand, with documented shortages of both Ozempic and Wegovy.

The impact won’t be immediate. The parties expect the deal to close near the end of 2024. Novo Nordisk said it expects the three new sites to “gradually increase Novo Nordisk’s filling capacity from 2026 and onwards.”

As for the rest of Catalent — nearly 50 other sites employing thousands of workers — Novo Holdings will take control. The group previously acquired Altasciences in 2021 and Ritedose in 2022, so the Catalent deal builds on a core investing interest in biopharma services, Novo Holdings CEO Kasim Kutay told Endpoints News.

Kasim Kutay

When asked about possible site closures or layoffs, Kutay said the team hasn’t thought about that.

“That’s not our track record. Our track record is to invest in quality businesses and help them grow,” he said. “There’s always stuff to do with any asset you own, but we haven’t bought this company to do some of the stuff you’re talking about.”

What does it mean for Catalent’s customers? 

Until the deal closes, Catalent will operate as a standalone business. After it closes, Novo Nordisk said it will honor its customer obligations at the three sites, a spokesperson said. But they didn’t answer a question about what happens when those contracts expire.

The wrinkle is the long-term future of the three plants that Novo Nordisk is paying for. Those sites don’t exclusively pump out Wegovy, but that could be the logical long-term aim for the Danish drugmaker.

The ideal scenario is that pricing and timelines remain the same for customers, said Nicole Paulk, CEO of the gene therapy startup Siren Biotechnology.

Nicole Paulk

“The name of the group that you’re going to send your check to is now going to be Novo Holdings instead of Catalent, but otherwise everything remains the same,” Paulk told Endpoints. “That’s the best-case scenario.”

In a worst case, Paulk said she feared the new owners could wind up closing sites or laying off Catalent groups. That could create some uncertainty for customers looking for a long-term manufacturing partner.

Are shareholders and regulators happy? 

The pandemic was a wild ride for Catalent’s stock, with shares surging from about $40 to $140 and then crashing back to earth. The $63.50 share price for the takeover is a happy ending depending on the investor.

On that point, the investing giant Elliott Investment Management is satisfied. Marc Steinberg, a partner at Elliott, called the agreement “an outstanding outcome” that “clearly maximizes value for Catalent stockholders” in a statement.

Elliott helped kick off a strategic review last August that culminated in the sale agreement. Compared to Catalent’s stock price before that review started, the deal pays a nearly 40% premium.

Alessandro Maselli

But this is hardly a victory lap for CEO Alessandro Maselli, who took over in July 2022 when Catalent’s stock price was north of $100. Novo’s takeover is a tacit acknowledgment that Maselli could never fully right the ship, as operational problems plagued the company throughout 2023 while it was limited by its debt.

Additional regulatory filings in the next few weeks could give insight into just how competitive the sale process was. William Blair analysts said they don’t expect a competing bidder “given the organic investments already being pursued at other leading CDMOs and the breadth and scale of Catalent’s operations.”

The Blair analysts also noted the companies likely “expect to spend some time educating relevant government agencies” about the deal, given the lengthy closing timeline. Given Novo Nordisk’s ascent — it’s now one of Europe’s most valuable companies — paired with the limited number of large contract manufacturers, antitrust regulators could be interested in taking a close look.

Are Catalent’s problems finally a thing of the past?

Catalent ran into a mix of financial and operational problems over the past year that played no small part in attracting the interest of an activist like Elliott.

Now with a deal in place, how quickly can Novo rectify those problems? Some of the challenges were driven by the demands of being a publicly traded company, like failing to meet investors’ revenue expectations or even filing earnings reports on time.

But Catalent also struggled with its business at times, with a range of manufacturing delays, inspection reports and occasionally writing down acquisitions that didn’t pan out. Novo’s deep pockets will go a long way to a turnaround, but only the future will tell if all these issues are fixed.

Kutay said his team is excited by the opportunity and was satisfied with the due diligence it did on the company.

“We believe we’re buying a strong company with a good management team and good prospects,” Kutay said. “If that wasn’t the case, I don’t think we’d be here.”

Amber Tong and Reynald Castañeda contributed reporting.

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Petrina Kamya, Ph.D., Head of AI Platforms at Insilico Medicine, presents at BIO CEO & Investor Conference

Petrina Kamya, PhD, Head of AI Platforms and President of Insilico Medicine Canada, will present at the BIO CEO & Investor Conference happening Feb….

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Petrina Kamya, PhD, Head of AI Platforms and President of Insilico Medicine Canada, will present at the BIO CEO & Investor Conference happening Feb. 26-27 at the New York Marriott Marquis in New York City. Dr. Kamya will speak as part of the panel “AI within Biopharma: Separating Value from Hype,” on Feb. 27, 1pm ET along with Michael Nally, CEO of Generate: Biomedicines and Liz Schwarzbach, PhD, CBO of BigHat Biosciences.

Credit: Insilico Medicine

Petrina Kamya, PhD, Head of AI Platforms and President of Insilico Medicine Canada, will present at the BIO CEO & Investor Conference happening Feb. 26-27 at the New York Marriott Marquis in New York City. Dr. Kamya will speak as part of the panel “AI within Biopharma: Separating Value from Hype,” on Feb. 27, 1pm ET along with Michael Nally, CEO of Generate: Biomedicines and Liz Schwarzbach, PhD, CBO of BigHat Biosciences.

The session will look at how the latest artificial intelligence (AI) tools – including generative AI and large language models – are currently being used to advance the discovery and design of new drugs, and which technologies are still in development. 

The BIO CEO & Investor Conference brings together over 1,000 attendees and more than 700 companies across industry and institutional investment to discuss the future investment landscape of biotechnology. Sessions focus on topics such as therapeutic advancements, market outlook, and policy priorities.

Insilico Medicine is a leading, clinical stage AI-driven drug discovery company that has raised over $400m in investments since it was founded in 2014. Dr. Kamya leads the development of the Company’s end-to-end generative AI platform, Pharma.AI from Insilico’s AI R&D Center in Montreal. Using modern machine learning techniques in the context of chemistry and biology, the platform has driven the discovery and design of 30+ new therapies, with five in clinical stages – for cancer, fibrosis, inflammatory bowel disease (IBD), and COVID-19. The Company’s lead drug, for the chronic, rare lung condition idiopathic pulmonary fibrosis, is the first AI-designed drug for an AI-discovered target to reach Phase II clinical trials with patients. Nine of the top 20 pharmaceutical companies have used Insilico’s AI platform to advance their programs, and the Company has a number of major strategic licensing deals around its AI-designed therapeutic assets, including with Sanofi, Exelixis and Menarini. 

 

About Insilico Medicine

Insilico Medicine, a global clinical stage biotechnology company powered by generative AI, is connecting biology, chemistry, and clinical trials analysis using next-generation AI systems. The company has developed AI platforms that utilize deep generative models, reinforcement learning, transformers, and other modern machine learning techniques for novel target discovery and the generation of novel molecular structures with desired properties. Insilico Medicine is developing breakthrough solutions to discover and develop innovative drugs for cancer, fibrosis, immunity, central nervous system diseases, infectious diseases, autoimmune diseases, and aging-related diseases. www.insilico.com 


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Another country is getting ready to launch a visa for digital nomads

Early reports are saying Japan will soon have a digital nomad visa for high-earning foreigners.

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Over the last decade, the explosion of remote work that came as a result of improved technology and the pandemic has allowed an increasing number of people to become digital nomads. 

When looked at more broadly as anyone not required to come into a fixed office but instead moves between different locations such as the home and the coffee shop, the latest estimate shows that there were more than 35 million such workers in the world by the end of 2023 while over half of those come from the United States.

Related: There is a new list of cities that are best for digital nomads

While remote work has also allowed many to move to cheaper places and travel around the world while still bringing in income, working outside of one's home country requires either dual citizenship or work authorization — the global shift toward remote work has pushed many countries to launch specific digital nomad visas to boost their economies and bring in new residents.

Japan is a very popular destination for U.S. tourists. 

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This popular vacation destination will soon have a nomad visa

Spain, Portugal, Indonesia, Malaysia, Costa Rica, Brazil, Latvia and Malta are some of the countries currently offering specific visas for foreigners who want to live there while bringing in income from abroad.

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With the exception of a few, Asian countries generally have stricter immigration laws and were much slower to launch these types of visas that some of the countries with weaker economies had as far back as 2015. As first reported by the Japan Times, the country's Immigration Services Agency ended up making the leap toward a visa for those who can earn more than ¥10 million ($68,300 USD) with income from another country.

The Japanese government has not yet worked out the specifics of how long the visa will be valid for or how much it will cost — public comment on the proposal is being accepted throughout next week. 

That said, early reports say the visa will be shorter than the typical digital nomad option that allows foreigners to live in a country for several years. The visa will reportedly be valid for six months or slightly longer but still no more than a year — along with the ability to work, this allows some to stay beyond the 90-day tourist period typically afforded to those from countries with visa-free agreements.

'Not be given a residence card of residence certificate'

While one will be able to reapply for the visa after the time runs out, this can only be done by exiting the country and being away for six months before coming back again — becoming a permanent resident on the pathway to citizenship is an entirely different process with much more strict requirements.

"Those living in Japan with the digital nomad visa will not be given a residence card or a residence certificate, which provide access to certain government benefits," reports the news outlet. "The visa cannot be renewed and must be reapplied for, with this only possible six months after leaving the countr

The visa will reportedly start in March and also allow holders to bring their spouses and families with them. To start using the visa, holders will also need to purchase private health insurance from their home country while taxes on any money one earns will also need to be paid through one's home country.

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