Athenex – Rehash

Author: Viceroy Research Published on: October 28, 2019 Published in: Athenex NASDAQ:ATNX

Athenex recycle press releases to pump investors. Viceroy release details of further conflicts with Athenex CROs.

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October 28, 2019 – This report will continue to touch on major Athenex conflict of interest issues.

In another slap to the face for invetors, Athenex, instead of addressing any of the major issues Viceroy have put forward, have chosen to instead re-publish a press release from March 4, 2019, marketing the results of topical medication with their project partner, Almirall.
In case the connections to fraud were not already apparent, Almirall has recently settled a $3.5m Department of Justice and $3.1m California Department of Insurance claims relating to kickbacks and bribery of physicians for the promotion of their product. Athenex aim to use Almirall for their vast sales network.
Viceroy today release data showing PharmaEssentia, Athenex CRO, is also a related party. To recap, all three major Athenex CROs have an interest in the approval and ongoing success of the products they are conducting the trials for, as we have previously reported on CIDAL and ZenRx.
Athenex CEO Johnson Yiu Nam Lau is a busy man, moonlighting at yet another anti-cancer company, Taiwanese comapny Taivex Therapeutics. Investors should be asking what Athenex’s Chief Executive Officer is doing at another anti-cancer biotechnology company, especially if he finds the time to be credited in numerous academic papers sponsored by that company, and what possible conflicts of interest may have arisen.

We conclude that Athenex exists to abuse capital markets and enrich its management through related party transactions and licensing deals, rather than bring revolutionary drugs into the market.

Viceroy value ATNX stock at US$2.83 – a 71% downside –the sum of its tangible book value and 1x valuation on its licensing & consulting revenue streams, for the year ending June 30, 2019. With ATNX’s questionable license acquisitions and management’s precedent for overstated top line figures in previous ventures: this is optimistic.

Viceroy remain short Athenex.

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