Summary
- Sheep of Wall Street posted pictures of a supposed plant visit by FDA inspectors that's crucial to the Bristol-Myers/Celgene milestone.
- The photos have been met with some skepticism, but I believe there is reason to believe they are legit.
- In addition, the downside/upside seems skewed upwards as I find the rights undervalued to begin with.
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Back in September 8, news came out that the Contingent Value Right, or CVR (NYSE:BMY.RT), associated with Bristol-Myers Squibb's (NYSE:BMY) $74B acquisition of Celgene was down significantly in apparent reaction to management comments at a Citigroup conference revealing that the manufacturing plant for CAR T therapies has not yet been inspected by the FDA. These contingent value rights are strange beasts. This particular one either pays out either $0 or $9 apiece. Take note the payout is binary. There are no other options except through an undesirable route of litigation.
Here's how it has traded since it listed separately after the closure of the Celgene acquisition:
It turns out that the plant is getting inspected, and in my opinion, it should trade up at least into the $3.5-$5 range. I believe its value is actually in excess of that but acknowledge that the market has consistently disagreed with my views. It came close in April but not after that.
The last few days it has been surging and Sheep of Wall Street (Twitter nickname) posted what were supposed to be photos of FDA plant inspectors on Twitter. He later removed it because potentially FDA inspectors wouldn't appreciate getting their pictures posted on Twitter. To be honest it didn't help me that much because it was very blurry and it did not show faces well. The blurry pictures raised a lot of suspicions among people.
