UNS - Unilife Corporation

[Sean K]

I will eat my hat if this company does not go into administration in the next year.

Hat prepared, but the only way they're going to stay afloat is to keep asking for cash. That's going to get harder and harder the longer they go on not getting any decent sales in place.

30 July 4th Quarter Highlights:

Net Loss: $14.9m
Net Loss Per Share - diluted: $0.21
Proceeds from diluting your shareholder value: $19m

Still no meaningful contracts.

 

[herzy]

Interesting and informative read - thanks kennas and others, will follow with interest. Being quite young and new to the share market, it's good to gain exposure (in an educational not financial sense) to a wide range of situations - namely, lack of sales, bad management, capital raising, etc.

 

[Sean K]

Oh deary me, another capital raising at what price? Whatever they can get?? I am totally bewildered by the latest effort to mine the market in order to keep paying the fat salaries they are giving themselves. And bonuses! Remarkable that ASIC is allowing this to go on.

 

[pacestick]

Oh deary me, another capital raising at what price? Whatever they can get?? I am totally bewildered by the latest effort to mine the market in order to keep paying the fat salaries they are giving themselves. And bonuses! Remarkable that ASIC is allowing this to go on.

An ATM is not a normal capital raising
http://www.youtube.com/watch?v=X-LbVnzk1W0&feature=youtu.be

worth a watch

 

[Sean K]

An ATM is not a normal capital raising
http://www.youtube.com/watch?v=X-LbVnzk1W0&feature=youtu.be

worth a watch

No it's not, but it's still a capital raising. A facility that they can draw on. Do they issue shares when they do that, or is just a loan? Alan is trying to sell this as some type of 'insurance policy', but I anticipate it will be accessed once they run out of money from the last capital raising. We'll see.

This interview with Griffin is just a company advert. Griffin had a BUY on this in June 11 with a 12 month price target of US$10.50. Now $2.75.

Financial results for 2013 first quarter next Tuesday. I wonder if they'll better the $15m loss last quarter.

 

[Sean K]

Financial results for 2013 first quarter next Tuesday. I wonder if they'll better the $15m loss last quarter.

UNILIFE CORPORATION RESCHEDULES RELEASE OF QUARTERLY RESULTS AND EARNINGS CALL DUE TO SEVERE WEATHER IN NORTHEASTERN U.S. ---

Reschedules Conference Call for 4:30 p.m. U.S. EST on Thursday, November 8, 2012

But, they released a 4C.

Cash flow summary:

Inflow:
Receipts from customers: $10K
Payments:
Staff costs: $3.7m
R&D: 2.3m
Working Capital::$3.6m

Loss: $10.4m

That's better than last quarter.

HANG ON!!!!

Receipts $10K!
Sales were supposed to start in Jul 2011!!
What's happened with those recent contract agreements?

June 18, 2012, 11:49 a.m. EDT
Unilife Signs Long-Term Supply Contract for the Unifill Prefilled Syringe
--Unifill Chosen for Upcoming Launch of Generic Equivalent of Auto-Immune Therapy --7-Year Contract to Generate Annual Revenue of up to $15MM for Initial E.U. Geography --Exclusivity Fee for Initial E.U. Geography and Indication, Other Territories Reserved

Is UNS heading this way?

I've resisted digging up the history of UNS, but after reading their annual financial report I can not resist any longer.

This article warrants reading by anyone considering trusting this company and the management.

READ THIS!

This article is heavily edited to fit in the space and you should read it by hitting the title. Nothing has been added, just deletions.

What ever happened to Unitract in Australia?

Maybe he gets it right this time??

 

[JTLP]

But, they released a 4C.

Cash flow summary:

Inflow:
Receipts from customers: $10K
Payments:
Staff costs: $3.7m
R&D: 2.3m
Working Capital::$3.6m

Loss: $10.4m

That's better than last quarter.

HANG ON!!!!

Receipts $10K!
Sales were supposed to start in Jul 2011!!
What's happened with those recent contract agreements?



Is UNS heading this way?

The fact that they pumped more money into staff than R&D for a business that really needs to blow up is a bit...um...different...

 

[pacestick]

Receipts $10K!
Sales were supposed to start in Jul 2011!!
What's happened with those recent contract agreements?


perhaps this

Unilife's Bolus Injector Platform Targeted by Global Pharmaceutical Company for Use in Multi-Drug Program

Cumulative device revenues expected to exceed $300MM for the first of five or more target drugs

YORK, Pa., Nov. 8, 2012 /PRNewswire/ -- Unilife Corporation ("Unilife" or the "Company") (NASDAQ: UNIS; ASX: UNS) today announced that its Precision-Therapy™ platform of bolus injection systems has been selected by a global pharmaceutical company to enter the next stage of collaboration as its preferred choice for long-duration subcutaneous drug delivery.

Unilife has been advised that the global pharmaceutical company (the "Customer") is targeting more than five pipeline injectable drugs for use with the Precision-Therapy platform of bolus injectors (wearable, disposable pumps). The first of these target drugs identified by the Customer is in Phase III clinical trials.

Unilife has recently commenced the initial supply of its Precision-Therapy devices to the Customer. Initial revenues will be generated by Unilife during the current fiscal year as it supports the immediate needs of the Customer under this partnership program.

Unilife expects to enter into a development agreement with the Customer during the current fiscal year to customize Precision-Therapy devices for use in the first target drug's upcoming human clinical trials. Unilife expects the first of these development agreements to generate in excess of $10 million in revenue over an 18 to 24 month period. Unilife expects to successively enter into a series of additional development agreements with similar terms relating to the other target drugs.

Unilife further expects that it will begin commercial supply of Precision-Therapy bolus injectors to the Customer in 2015 to support the anticipated market launch of the first target drug. Commercial supply contracts for each targeted drug under the program are expected to have an initial term of seven years. Based upon indicated customer requirements for the first drug candidate, Unilife expects to generate commercial revenues of approximately $50 million per year under an initial supply contract.

Unilife expects that it will enter into separate commercial supply contracts for each target drug brought to market by the Customer. Across the full portfolio of target drugs identified by the Customer, Unilife expects that commercial supply revenues per drug will range between $30 million and $70 million a year.

For commercial purposes and due to confidentiality clauses within the agreement, additional terms of the contract and the identity of the pharmaceutical company are to remain confidential at this time.

Mr. Alan Shortall, CEO of Unilife, said, "Our Precision-Therapy™ platform of bolus injectors and Flex-Therapy™ platform of infusion pumps are consistently being identified by pharmaceutical companies as the preferred technology for the long-duration subcutaneous delivery of injectable drugs.

"It is important to note that today's announcement regarding the selection of our bolus injection platform by a global pharmaceutical company follows an extensive evaluation process involving many of our device competitors. The customer has advised that their rationale for the selection of Unilife was our deep industry expertise, advanced operational capabilities, strong patent position and ability to consistently exceed program requirements. They believe our superior device technology will represent a major part of the value proposition to support the successful commercial launch of a series of injectable therapies that currently reside within their clinical pipeline.

"The platform-based approach we have utilized in the development of our Precision-Therapy bolus injectors means that we will play an integral role in the clinical development, regulatory approval and commercial success of a broad portfolio of injectable therapies under a long-term collaboration with this customer.

"We look forward to the signing of an initial development agreement this fiscal year to customize a device from our Precision-Therapy platform that will address the specific needs of this customer for the first of their target drugs. I expect each commercial supply contract that we sign under this program can ultimately generate hundreds of millions of dollars in cumulative revenues during its full term. Such long-term collaborations underpin the strength of the strategic relationships that we continue to build with a number of pharmaceutical companies for drug-device combination products.

"This marks the start of a multi-stage, multi-drug long-term partnership with this global pharmaceutical company. However it is just one of many exciting opportunities that now reside within our fast-expanding commercial pipeline. We look forward to entering into similar partnerships with other pharmaceutical companies that are now at various stages in the evaluation and selection of devices from our broad portfolio of technology platforms that will enable and enhance their target pipeline and approved drugs," Mr. Shortall concluded.

Precision-Therapy™ Bolus Injector Platform and Flex-Therapy™ Infusion Pump Platform

Unilife has developed the Precision-Therapy platform of bolus injectors and Flex-Therapy platform of infusion pumps to help enable and enhance bolus or rate-based injectable therapies that require the long-duration subcutaneous delivery of doses between 1mL and 30mL in volume. Featuring a primary container with standard materials in the fluid path, they are designed for integration into existing fill-finish lines and can be customized to address specific customer or patient needs including dose volume, delivery rate and duration, drug viscosity, and ergonomic design. Compact in size and highly intuitive for use, they can be comfortably worn on or off the body of a patient during the designated dose duration. Patients simply push a button to commence the automatic delivery of the dose via a soft, indwelling catheter. Visual and audible electronic indicators communicate with the patient during each stage of use. Upon the delivery of the full dose, the device can be removed from the body for convenient disposal.

About Unilife Corporation

Unilife Corporation (NASDAQ:UNIS / ASX: UNS) is a U.S. based developer and commercial supplier of injectable drug delivery systems. The Unifill ® syringe, the world's first and only prefilled syringe with fully integrated safety features, sits at the leading edge of a broad portfolio of innovative, highly differentiated devices. In addition to prefilled syringes with automatic needle retraction, Unilife has other proprietary technology platforms including drug reconstitution delivery systems, auto-injectors, bolus injectors, infusion pumps and targeted delivery systems. Unilife's global headquarters and state-of-the-art manufacturing facilities are located in York, PA. For more information on Unilife, please visit www.unilife.com

Forward-Looking Statements

This press release contains forward-looking statements. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future are forward-looking statements. These forward-looking statements are based on management's beliefs and assumptions and on information currently available to our management. Our management believes that these forward-looking statements are reasonable as and when made. However, you should not place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. We do not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results, events and developments to differ materially from our historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to, those described in "Item 1A. Risk Factors" and elsewhere in our Annual Report on Form 10-K and those described from time to time in other reports which we file with the Securities and Exchange Commission.

General: UNIS-G

Investor Contacts (US):


Analyst Enquiries


Investor Contacts (Australia)


Media Contact

Todd Fromer / Garth Russell


Lynn Pieper


Jeff Carter


Eve McGrath

KCSA Strategic Communications


Westwicke Partners


Unilife Corporation


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P: + 61 2 8346 6500


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SOURCE Unilife Corporation

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Unilife Corporation
250 Cross Farm Road , York, PA 17406
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[Sean K]

Receipts $10K!
Sales were supposed to start in Jul 2011!!
What's happened with those recent contract agreements?


perhaps this

Unilife's Bolus Injector Platform Targeted by Global Pharmaceutical Company for Use in Multi-Drug Program

Have you noticed a trend yet?

November 29, 2011
Unilife Signs Clinical Development and Supply Agreement with Global Pharmaceutical Company


October 5, 2011
Unilife Wins Supply Contract with Nation's Largest Healthcare Alliance


July 19, 2011
Unilife Starts Unifill Syringe Sales to Another Pharmaceutical Customer


July 13, 2011
Unilife Commences Initial Supply of the Unifill ® Syringe to Sanofi


March 29, 2011
Unilife Commences Initial Production of Unifill Prefilled Syring


March 15, 2011
Unilife on Schedule to Fill Initial Orders for Unifill Syringe


November 15, 2010
Unilife Commences U.S. Sales of Unitract ® 1mL Syringes

He continues to announce deal after deal after contract after sales and yet?

$10K in revenue for the quarter?

We must be reading that statement incorrectly.

Surely revenue from sales/contracts as mentioned above hidden in there somewhere?

 

[Sean K]

From the first quarter results statement:

There can be no assurance that any such funding will be available when needed or on acceptable terms. These various factors raise substantial doubt about the Company’s ability to continue as a going concern.

 

[Sean K]

AGM last week and Alan was stating future $1b in revenue.

$10k to $1b revenue within what seems like the space of a couple of years.

Dozens of contracts and partners in place who are interested in multiple devices.

(Can't tell you who they all are though)

 

[Sean K]

I note 30% of shareholders voted against the executive remuneration package at the AGM.

Big number.

This is really fun following this company.

If they get a foot in the door with some real sales contracts they could do anything, but the market is so closed it will be almost impossible.

Next Quarterly will be telling on the income front.

 

[skc]

I note 30% of shareholders voted against the executive remuneration package at the AGM.

Big number.

This is really fun following this company.

If they get a foot in the door with some real sales contracts they could do anything, but the market is so closed it will be almost impossible.

Next Quarterly will be telling on the income front.

You are addicted to this company (like I was with GCN at one stage).

You are at Bondi? You should go to Bronte and catch John Hempton of Bronte Capital for a chat. He's really into this sort of stuff. Although without looking at this too deeply, it looks more like an incompetent-spin-doctor-enriching-executive setup rather than a fraud.

 

[Sean K]

I note 30% of shareholders voted against the executive remuneration package at the AGM.

Big number.

So, is this a first strike?

Who has over 30% of shareholders rejecting a rem report?

You are addicted to this company (like I was with GCN at one stage).

This is extremely entertaining to me.

The last 6 months has been a great period for the XAO in general and UNS has come out with some very very positive announcements (in their mind). Compare the charts.

 

[Sean K]

6 OCT 11

Unilife Wins Supply Contract with Nation’s Largest Healthcare Alliance

Premier Selects Unitract ® 1mL Safety Syringes for Two-Year Contract

York, PA (October 6, 2011) Unilife Corporation (“Unilife” or the “Company”) (NASDAQ: UNIS; ASX: UNS) today announced it has been awarded a two-year contract by Premier Purchasing Partners, L.P., the group purchasing enterprise of the Premier healthcare alliance, for the supply of its Unitract ® 1mL safety syringes.

Premier, Inc. is the nation's largest healthcare alliance, helping to improve performance and providing group contracting to more than 2,500 U.S. hospitals and over 76,000 healthcare sites nationwide.

Where's the income?

20 JUL 11

Unilife Starts Unifill Syringe Sales to Another Pharmaceutical Customer

York, PA (July 20, 2011) - Unilife Corporation (“Unilife” or the “Company”) (NASDAQ: UNIS; ASX: UNS) today announced it has commenced the initial sale of the Unifill ® ready-to-fill syringe to a U.S.-based global pharmaceutical company.

The commencement of Unifill sales to this new customer, whose identity remains confidential at this time, follows the initial shipment of the device to Sanofi last week. Unilife continues to expand its customer pipeline as an increasing number of pharmaceutical companies seek access to Unifill for the delivery of their prefilled injectable drugs.

Where's the income?


In both cases these were 'sales' and 'contracts'.

Now, since then:

Dec 11 quarterly product sales and 'other' $17K.
Mar 12 quarterly product sales and 'other' $10K.
July 12 yearly product sales and 'other' $61K.
Sep 12 quarterly product sales and 'other' $29K.

Accumulated deficit currently stands at $185m.

 

[Sean K]

Alan Shortall rated No 1 by The Fin!!

No 1 least value CEO for shareholders that is.

The entertainment continues.

 

[pacestick]

http://www.4-traders.com/UNILIFE-CORP-5977761/consensus/

 

[Sean K]

http://www.4-traders.com/UNILIFE-CORP-5977761/consensus/

That doesn't really help us much stick. Who are the brokers? The only detailed analysis I've seen was posted a couple of pages ago and it was a company who had done a raising for them. It was also completely wrong in its price target assessment. By a very long way. The problem is these brokers are simply listening to the projected sales from AS and he has not delivered. His latest call of $1b sales is an absolute joke. He has little credibility.

 

[Sean K]

Burning 10-15m a quarter I estimate they'll be out of cash by March. I guess they then tap into that slush fund placed with Cantor Fitzgerald of $45m that they will sell stock at any price they can get. That should keep the R&D going and pay the salary of the 'No 1 least value CEO' on the ASX for a while longer.

 

[pacestick]

http://seekingalpha.com/article/113...hort-squeeze?source=email_rt_article_readmore


An Interview With Unilife's CEO: A Long-Term Opportunity And A Looming Short Squeeze
January 25, 2013 | about: UNIS

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. (More...)

By Ivan Deryugin

Earlier this week I had the pleasure of speaking with Alan Shortall, President and CEO of Unilife (UNIS), about the company's short and long-term prospects. Over the course of the next few months, a confluence of factors, including a commercialization ramp and a looming short squeeze, are likely to create value for Unilife investors. With UNIS down over 25% in the last six months alone, there is value to be found in the shares of this company.

Overview

Unilife's predecessor company was founded in 1985 and is currently based in York, Pennsylvania. The company develops a variety of injectable drug delivery systems, and while it has yet to begin generating revenue from meaningful sales of its delivery systems and syringes, 2013 is poised to be a pivotal year for Unilife as it recovers from past stumbles and begins to realize its potential. As Mr. Shortall noted, Unilife stands ready to take advantage of several key healthcare trends, trends that stand to benefit Unilife and its investors over the course of the coming months.

As healthcare costs continue to soar, both here in the United States and across the world, every player in the healthcare market is looking for new ways to drive down costs while preserving or improving the quality of care that patients receive. Self-administered and self-injected drugs are becoming more and more prevalent; according to Ernst & Young, up to 50% of healthcare will be administered outside of the traditional healthcare system (hospitals, clinics, etc…) by 2020. An accompanying shift toward biologics will also begin to change the American healthcare system. According to Mr. Shortall, there are currently around 1,000 different biologics in development in the pipeline of American pharmaceutical companies alone, and these biologics are more challenging to commercialize than traditional drugs. Many are complex and viscous compounds, requiring new methods of delivery. Enter Unilife. The company's Unifill and EZMix syringes allow patients to treat themselves quickly and easily. But Unilife's business model is not simply about helping patients. Rather, it's about helping pharmaceutical companies meet their unmet needs, and this is how Unilife plans to deliver value for its customers and investors.

Injecting Itself into the Pharmaceutical Supply Chain

As I spoke with Mr. Shortall, I came to see him as an executive with a clear vision as to how his company will succeed and a plan to turn that vision into a reality. While Mr. Shortall was certainly enthusiastic about the quality of life improvements that these syringes and delivery systems can have for patients, he was even more excited about the potential that these products hold for pharmaceutical companies. Mr. Shortall recounted how a large pharmaceutical company (defined by him as one of the five largest) was developing a new biologic, and was setting up clinical trials for it. However, the mechanism of action for this specific biologic required that the drug be delivered via surgery. This created a variety of complications for the clinical study, especially in recruiting patients (to say nothing of the complexities of managing such a drug post-FDA approval). The company turned to Unilife, awarding it a $1.4 million contract to find a better way. And Unilife delivered, producing an injectable drug delivery system that eliminates the need for surgical administration and allows the timing of delivery during administration. This leads to better clinical outcomes and higher odds of approval.

The crucial element here is perhaps the most easily overlooked: by creating this drug delivery system, Unilife has made it an essential part of the mechanism of action for this biologic, and if and when the drug is approved by the FDA, it will be approved as a "package deal," thereby injecting Unilife into the supply chains of its pharmaceutical customers. Mr. Shortall does not want his company to be another generic medical device company churning out high volumes of low-margin medical products. Rather, he wants Unilife to become an integral part of the pharmaceutical supply chain, and the company already counts Sanofi (SNY) as a customer.

In 2009, Unilife and Sanofi entered a 5-year industrialization agreement. Under the terms of the agreement, Sanofi received exclusive rights to the Unifill syringe in several indications, including antithrombotic agents, vaccines, and four other unnamed indications. Sanofi paid Unilife 17 million euros for this license, which expires on June 30, 2014. Unilife began supplying Sanofi with Unifill syringes in July 2011, and has received over $40 million from the global pharmaceutical company, which is estimated to be the world's largest buyer of prefilled syringes. Other pharmaceutical companies have begun deploying Unilife's technology as well. In early November, Unilife announced that a "global pharmaceutical company" had selected its Precision-Therapy bolus injection system for use in its clinical trial process. Unilife stated that the system is being used in five pipeline programs, with the first being in Phase III trials. Unilife has commenced shipments to the company, and expects to sign a supply agreement with the company, estimated to be worth $10 million over the next 18-24 months. The deal is set to be signed in fiscal 2013 (the company's fiscal year ends June 30). Unilife also stated that full product shipments are likely to commence in 2015, with annual revenue of $50 million per year from shipments of Precision-Therapy bolus injectors alone. The company also stated that it expects between $30-$70 million in supply revenue per drug from this deal. And in December, Unilife announced that a U.S. pharmaceutical company has begun to study its products for use in its clinical trials, as well as existing drugs. While Unilife did not give revenue projections for this deal, the company did state that it expects peak annual demand of 25-35 million injection units from this company alone.

At Unilife's annual meeting, held in late November, the company gave an update on its commercialization efforts. CEO Alan Shortall described five different EZMix programs that the company is working with 21 different customers, across 31 different development programs, and said that 13 of these are set to generate revenue in fiscal 2013, with peak sales estimated at $992 million.

(click to enlarge)

While Unifill is the company's most advanced product, Unilife is developing a variety of other injection systems. EZMix, designed for drug reconstitution, with five different EZMix programs set to begin generating revenue in fiscal 2013 and 2014. The company has one auto-injection platform set to begin generating revenue in 2013, and two in 2014. Four of the company's injection pump programs are set to begin generating revenue in 2013, as are two of its targeted delivery systems, which are designed for the delivery of drugs that require specific delivery sites, such as eye injections. The ramping of Unilife's sales can be seen through consensus estimates for the company's revenue, provided by Reuters (Unilife lost revenue of $5.519 million in fiscal 2012).

According to consensus estimates, Unilife is set to generate $20.1 million in revenue in fiscal 2013 (a growth rate of 264.17%), and $88.4 million in fiscal 2014, which would represent an acceleration of growth to 339.8%. And Cantor Fitzgerald, which has a $7.50 price target on Unilife, models revenue of $500 million by fiscal 2016, and sustainable profitability by the end of fiscal 2014. Unilife lost $0.78 per share in fiscal 2012, and those losses are projected to narrow in fiscal 2013 and 2014, to $0.48 and $0.09 per share, respectively.

Financials & Market Structure: Addressing the Need for Capital

Unilife's stock has been battered over the past year, falling almost 38% as the company depleted its capital reserves investing in future growth. Unilife ended its latest quarter with over $10 million in cash and investments on its balance sheet, and with a quarterly burn rate of over $10 million, it would seem that the company is going to need to raise capital imminently. However, the situation is more complex than it appears to be. Unilife already set up a controlled equity offering agreement for $45 million in early October, and to date has not utilized it according to Mr. Shortall. During our conversation, he stated that he wants to limit dilution as much as possible, and that the company has no immediate plans to issue new stock; if capital is needed, he prefers to issue debt. Unilife ended its latest quarter with over $10 million in debt, of which $6.7 million is due within the next 12 months. The remaining debt is long-term in nature, with maturities in 2020, 2021 and 2031. Mr. Shortall stated that any capital that the company will raise in fiscal 2013 will be minimal, and that a capital raise would be designed to bridge the company to the closing of new supply contracts, which he hopes to announce over the next few months. With shares down sharply over the past year, expectations of a capital raise are likely already priced in. While the Unilife story is a promising one, it is admittedly long-term in nature. However, there are short-term elements at work here as well. As Unilife begins to announce new deals with pharmaceutical companies, a number of factors may lead to a dramatic short squeeze.

A Looming Short Squeeze

Unilife was originally incorporated in Australia in 1985, and the company began trading on the NASDAQ in 2010, having transferred its operations to the United States from Australia. However, Unilife is not a reverse merger shell company (that being said, Australian financial reporting standards are equivalent to those of the United States in terms of rigor, for Australia is a highly stable democracy). Rather, Unilife made the decision to transfer its operations to the United States, for a variety of reasons. The company delisted itself from the ASX, and relisted on the NASDAQ via a traditional listing.

Unilife ended its latest quarter with over $10 million million shares outstanding, and according to the latest NASDAQ data, 10.2 million shares of Unilife were sold short (12.16% of all shares outstanding). While this level of short interest is already relatively high, Mr. Shortall pointed out, correctly in my view, that this data does not tell the whole story. Around 40 million of Unilife's shares are held by Australian investors via over $10 million CDIs, Australia's version of an ADR. While it's possible to convert Unilife's CDIs back into common stock, the process is long and cumbersome, and plays a role in artificially deflating Unilife's trading volume here in the United States (the company's average daily volume over the past 50 trading days has been around 305,000 shares). Mr. Shortall himself owns over 5.4 million shares of Unilife. Excluding restricted stock, he holds 3,158,043 shares, or 3.79% of the company. And Unilife's institutional ownership is highly concentrated. JP Morgan is the company's largest investor and owns over 6.1 million shares of Unilife. The company's five largest institutional investors own 14.9 million shares, or 17.95%. When the nuances of Unilife's ownership structure are taken into account, the company's true short interest is in fact much higher. When accounting for shares held by Australian investors, and Mr. Shortall's stake, Unilife's short interest jumps from 12.16% to over 25%. According to Mr. Shortall, he and what he described as "key investors" own a combined 25 million shares of Unilife. When the company's Australian shares, Mr. Shortall's direct stake, and the holdings of "key investors" are taken into account, Unilife's short interest soars to over 55%. Given that seven of Unilife's 15 largest institutional investors chose to up their stakes during the last few months of 2012 (five maintained their stakes and three decreased their holdings), I do not believe that they will be quick to let go of their shares when the company begins to announce supply deals over the coming months. The nuances of Unilife's capital markets structure are a recipe for a short squeeze, as only around half of Unilife's shares are even available in the United States, and millions of those shares are held by Mr. Shortall himself and long-term institutional investors (Fidelity, which owns 2.4% of the company, has been an investor since May 2011, and JPMorgan has been invested since November 2011).

Conclusions

Unilife offers something for both short-term and long-term investors. The company's stock has been battered over the past year as investors awaited a capital raise, one that has not materialized, nor is likely to materialize. Unilife's CEO has stated that he prefers debt financing to equity financing, and the company is set to begin announcing deals, with Mr. Shortall confident that the company will have announcements to make over the coming months. Unilife's products meet a clear medical need, and pharmaceutical companies are already utilizing Unilife products in both clinical trials and approved drugs. 2013 is likely to be a transformational year, with a number of the company's development programs set to begin generating revenue. And as the company continues to execute on its development strategy, the nuances of its capital markets structure are setting the stage for a short squeeze. In my view, investors could consider adding to or initiating positions in a company whose best days are ahead if it.

Additional disclosure: PropThink is a team of editors, analysts, and writers. This article was written by Ivan Deryugin. We did not receive compensation for this article, and we have no business relationship with any company whose stock is mentioned in this article. Use of PropThink’s research is at your own risk. You should do your own research and due diligence before making any investment decision with respect to securities covered herein.You should assume that as of the publication date of any report or letter, PropThink, LLC and persons or entities with whom it has relation ships (collectively referred to as "PropThink") has a position in all stocks (and/or options of the stock) covered herein that is consistent with the position set forth in our research report. Following publication of any report or letter, PropThink intends to continue transacting in the securities covered herein, and we may be long, short, or neutral at any time hereafter regardless of our initial recommendation. To the best of our knowledge and belief, all information contained herein is accurate and reliable, and has been obtained from public sources we believe to be accurate and reliable, and not from company insiders or persons who have a relationship with company insiders. Our full disclaimer is available at www.propthink.com/disclaimer.