The campervan operator Tourism Holdings (THL) is proposing to sell some assets to get its merger with Australian operator Apollo Tourism & Leisure (ATL) over the line.
The proposed tourism firms’ merger has raised competition concerns.
Photo: Unsplash / Lawton Cook
The proposed takeover of Apollo prompted regulators on both sides of the Tasman to raise concerns, with New Zealand’s Commerce Commission worried it would dent competition.
The Australian Competition and Consumer Commission (ACCC) voiced similar concerns to their New Zealand counterpart on the merger, which was first proposed in December last year.
THL announced this morning it had begun discussions with the Commerce Commission and ACCC, seeking clearance on the basis the merged entity divests certain assets in each country.
It said it had entered into exclusive negotiations with Next Capital to sell those assets to Jucy Rentals. THL said Next Capital had recently agreed to acquire a controlling interest in Jucy.
Under the proposal, THL and Apollo have or is offering to divest a significant proportion of Apollo’s four to six berth motorhome fleet in New Zealand and Australia.
It’s also proposing to sell Apollo’s premium Star RV motorhome brand, a proportion of the forward bookings associated with the fleet sold and surplus property leases – on an as needed basis.
“THL continues to strongly believe that the proposed merger will not substantially lessen competition in any jurisdiction.
“However, recognising the concerns raised by the respective regulators and with the intent to conclude the clearance processes in a timely manner, THL and ATL have commenced discussions with both the NZCC and ACCC seeking merger clearance on the basis that the merged entity divests certain assets in each country,” THL told the local sharemarket.
The Commerce Commission is seeking submissions from THL, Apollo and other interested parties on whether the proposed divestment would mean that the merger is unlikely to substantially lessen competition.
The commission said it will make a decision on the merger by 2 August, but said the date may be extended.
Westcoast Properties is to give all its members of staff, including sales and letting negotiators, two separate one-off ‘cost of living’ payments, one in October and one in January, to help them cope with the soaring cost of living.
The estate agency, which has branches in Weston-Super-Mare, Burnham-on-Sea, Portishead, Nailsea and Patchway, North Bristol, said the award is being introduced to coincide with when we are all going to be receiving our increased quarterly utility bills.
Nicholas Webber, director, Westcoast Properties, informs EYE that every member of staff will receive a £700 bonus.
Agents will receive £350 in October, following by another £350 payment in January 2023.
Webber explained: “Like most agents, we have had a good year which has enabled us to build up some reserves and whilst we’re expecting a slower market in the latter half of this year, it felt the right thing to do to support the teams that achieved the good results we’ve enjoyed.
“We know that everyone is going to feel the pinch in October and January when we receive our quarterly energy bills, so we wanted to be able to help relieve any worry and stress by offering this payment, hence why they will receive it in their October and January pay packs.
“We’re a close company and everyone is important to us, so it seems only right that we support each other where we can.”
New estate agency listings that don’t display a price can no longer be uploaded to Rightmove from today.
The portal giant has introduced new data fields to comply with National Trading Standards Estate and Letting Agency Team (NTSELAT) material information rules.
Fields such as price on application and offers invited have been removed so a listing will not be set live unless there is a price in it.
Agents will still be able to use terms such as “offers in excess of.”
As with other portals such as Zoopla and OnTheMarket, Rightmove has introduced new data fields for tenure and council tax on new listings.
But speaking at the Propertymark national conference yesterday, David Cox, legal director of Rightmove warned that none of the portal’s listings are technically compliant now.
This is because CRM systems have failed to provide the required data to automatically enter into the fields.
Cox said agents can enter the relevant information in the property description but warned that the lack of co-operation from data companies means no listings will be fully complete.
Dedicated categories such as tenure or council tax will say “ask the agent” if no information has been provided through required data feeds.
He said: “More than 700 data feed providers haven’t even made contact with us.
“We have been collecting information but only 5% of data feed providers that represent 1.7% of agents can actually feed anything into those fields.
“Not a single listing will be compliant.”
Cox urged agents to ask their CRM provider about providing the required data.
James Munro, head of the NTSELAT, said there were no plans to start issuing penalties from tomorrow as the organisation is prioritising collaboration.
He told delegates: “We are trying to make sure as many listings a possible are correct and that then means we can focus on the bad guys.”
The UK’s cultural hotspot
For example, just 190 miles northwest of the capital and straddled by the beautiful Pennine hills lies Manchester, an area with a rich industrial heritage, that is seeing unprecedented growth and economic activity. The city-region is only the fifth largest by population, but it is increasingly being referred to as the UK’s “second city”, thanks to its recently acquired image as Britain’s modern cultural capital.
The city’s roots are embedded in the textile manufacturing of the Industrial Revolution, but modern Manchester is the place for urban living with a slew of music venues, art houses, restaurants, and festivals. No wonder, then, that it has been named as one of the third best cities in the world according to global culture and events magazine Time Out, and one of the top three destinations in the UK for overseas tourists according to leading holiday website Hotels.com.
The world’s first industrial city has moved on….
It’s not all about the bright lights of the city though. Look behind the curtain stage and you will find a powerful international business hub, with companies such as Unilever, Kellogg’s, Siemens, Amazon, and Microsoft all having a presence here. Furthermore, professional services, finance, and banking have grown exponentially, which in turn has seen many professionals relocate to the area.
In fact, the Manchester economy is now bigger than that of Wales or Northern Ireland. It is no surprise then that research released by global real estate services firm Avison Young found its growth in 2021 was the second-highest of 30 major European cities, expanding by an impressive 8%.
At the heart of the North and the Northern Powerhouse
Manchester’s resilience in the face of the terrible economic impact of the coronavirus pandemic is a testament to its place as a key member of the Northern Powerhouse, a collection of connected northern cities that seek to emulate the economic success of London and the Southeast. The government’s focus on Manchester as a key means of rebalancing the UK economy has seen the area receive an £84 million investment to make trains more reliable, kicking off a decade’s worth of improvements across the region.
It has also been granted greater independence to decide its own future. Its elected has been given responsibilities that include a £300 million housing investment fund that is creating thousands of local jobs, quality homes, and commercial spaces for businesses.
So, about those property investment opportunities…
There is obviously huge investment, activity, and government support being poured into Manchester which forward-thinking investors should be taking advantage of while they can.
They should also keep in mind that house growth is at its fastest rate since 2007 according to Halifax, with the average house price across the country hitting £360k. This will leave many would-be landlords struggling to purchase suitable assets.
Not so in Greater Manchester, though, where properties across half of its boroughs can be bought for £150,000, according to data from the HM Land Registry. Unfortunately, cost of living increases has seen rising rents which have, in turn, increased the likelihood of defaulting tenants. Clearly, buying to let may not be a suitable option at this time for those looking for a hassle-free investment.
If you don’t want to be a landlord, take the Build to Rent (BTR) option.
For investors looking for good returns rather than hunting for renters who can pass referencing, there is always the option of Built to Rent (BTR). These are properties that are built, or redeveloped, specifically to be rented out rather than sold. Each development includes multiple units and a single company rather than individual landlords managing all the properties. The company manages and maintains the development to ensure it is secure, stable, and attractive to renters.
The BTR market is relatively new in the UK, but such is the popularity of the model that investors poured £4.1bn into BTR last year according to property advisory CBRE. In fact, a recently published analysis by the British Property Federation (BPF) demonstrates the BTR sector’s rapid expansion with 46,304 build-to-rent homes under construction at the end of the first quarter, which is up 14% year on year. This led the BPF to state that “Long-term demand for rental homes means the sector’s prospects remain very positive”. Manchester has embraced BTR wholeheartedly and there are many schemes for investors to get involved in such areas as the City Centre, Salford Quays and MediaCity.
Future Manchester. An economy built on people, place, and prosperity
The case for property investment in Manchester couldn’t be stronger. Its star continues to rise, propelled by a new economy and exciting cultural experiences that is attractive to a professional, middle-class workforce. In order to maintain this growth it needs to ensure a steady housing supply and is eagerly welcoming both investors and developers with open arms.
With so many developments underway, there are many opportunities to be considered and enjoyed. That being said, the word is already out, and many investors should be aiming to make their mark there sooner rather than later.
*Reece Mennie is the chief executive officer of property developers HJ Collection
There’s something about this place that makes it special not only to residents but visitors as well. Being here lifts the mood and puts a spring to your step. Those who reside here often feel motivated to step outside and enjoy the outdoors, to walk down its tree-lined paths to the park or the nearest neighbourhood retail centre and to mingle with fellow residents. Here, you’d want to lead a healthy wholesome lifestyle even when you had never felt like it before.
Lush with tropical trees and shrubs, Desa ParkCity lies on the northern part of Kuala Lumpur city, strategically straddled between Petaling Jaya city and the expat enclave of Mont’Kiara. The 473-acre township of outstanding projects can be reached via the New Klang Valley Expressway, Duta-Ulu Klang Expressway 3 and the Damansara-Puchong Highway.
Its most iconic landmark is the picturesque plant-filled and pet-friendly Central Park with a nine-foot-wide jogging path winding around a lake. Benches are thoughtfully placed along the pathway, allowing one to take in the views across the lake and drink in the relaxing environment. There is also an active playground for kids with some really unique equipment.
Like the Central Park, the neighbourhood retail centres are often a hive of activity, drawing both residents as well as visitors from far and near. The Waterfront, which lies next to the Central Park and the newer award-winning Plaza Arkadia nearby feature numerous outstanding offerings including cafes and restaurants as well as essentials such as grocers, clinics, pharmacies and children enrichment services.
The township is also home to The International School @ ParkCity and the ParkCity Medical Centre, which are accessible to the general public.
‘A dream come true’
Desa ParkCity is often referred to as the most liveable township in the country and residents here readily attest to that.
According to retiree Richard Chan, who lives in the gated neighbourhood of Nadia Parkhomes, living at Desa ParkCity is like a dream come true.
“I love this place. The moment I drive into the township, the scenery changes and I feel like I have entered a garden city, a place like no other.
“The living environment is good and the security perfect. It is also very convenient with two retail areas (The Waterfront and Plaza Arkadia) where you can shop, dine or enjoy other leisure activities,” says Chan, who has been staying here with his family for about 14 years.
Westside II resident S. Y. Liew agrees. “The modern urban living here suits my lifestyle. And the best thing is that it is complete with everything one needs for everyday life. It is so convenient you don’t need to go out as the township has supermarkets, banks, salons, international school, clinics and even a hospital,” says the 44-year-old entrepreneur.
Westside II is a 4.27-acre freehold condominium that was completed in 2015. Like Westside One, Westside II looks out over the lush West Park and The Waterfront. Unit sizes range from 1,389 to 1,777 sq ft.
C Y Puah, who moved into one of the condominiums in Desa ParkCity in 2019 with his family including two young children, describes life at Desa ParkCity as a seamless integration of live, learn, work and shop/play.
“It certainly is the ultimate doorstep convenience. Coupled with the lush and beautiful streetscapes providing a nice canopy of trees, it makes walking to anywhere around here pleasurable,” says the 40-year-old logistics manager.
The Puah family’s favourite hangouts are the Central Park and The Waterfront where they go to get their groceries or a meal.
“My children love to spend their time at the park after having dinner at The Waterfront. I go jogging there as well while my kid does some sports training at The ParkCity Club,” says Puah. The ParkCity Club and another recreational facility called The SportsCentre are exclusively for the residents’ usage.
“In developing Desa ParkCity, we go beyond by infusing our heart and soul into our community and township. Every addition and improvement made in the township is to promote the community’s health, happiness and well-being.” — Lau
The pillars that have built the ‘city’
Since the township was first launched in 2002, Desa ParkCity’s popularity among homebuyers and property investors has soared and seems far from waning. This is reflected in its property values. Some of the homes here have seen more than 100% capital appreciation.
According to an article in EdgeProp Malaysia late last year, data by property consultancy Savills Malaysia showed that the average transacted price of high-rise homes (1,000 sq ft to 1,999 sq ft) in Desa ParkCity had increased by 27.9% over the period from 2013 to 2018. This makes the price growth of such properties in the township higher even than those in the KLCC-Bukit Bintang and Mont’Kiara high-rise residential hot spots.
Values continue to rise despite the pandemic. For instance, one of the township’s completed high-rise residential project South Brooks were selling between RM563 and RM854 psf before the pandemic (2017-2019). Post pandemic (2020-2022), prices have gone up to between RM670 and RM909 psf.
Owning a home in Desa ParkCity is undeniably the dream of many. The draw has much to do with the development’s master plan. Crafted on the tenets of new urbanism, it calls for a multi-faceted approach to the planning, designing and management of public spaces.
The new urbanism planning of this township is guided by five vital pillars: FAMILY, NEIGHBOURHOOD, COMMUNITY, CONNECTIVITY and CONVENIENCE.
The result is the most liveable township where walkability is emphasised to access comprehensive facilities and amenities including education, healthcare, recreational, and retail assets. A rigorous security system that includes CCTV cameras, round-the-clock patrolling by auxiliary police, guarded neighbourhoods and the adoption of Crime Prevention through Environmental Design such as plant barriers along the streets, contributes to the walkability and liveability of the township.
Furthermore, amenities such as the retail centres and parks promote community engagement and spontaneous social interaction, which are further supported by community events that are regularly organised for its residents.
“In developing Desa ParkCity, we go beyond by infusing our heart and soul into our community and township as encapsulated by our five vital pillars,” says ParkCity Group CEO Datuk Joseph Lau.
Hence, not only does ParkCity incorporate sustainable and eco-friendly measures into every development aspect of the township, it is also committed to creating a wholesome and sustainable community where residents of all ages and walks of life can thrive in a safe, secure and holistic environment.
“This will always be our focus where every addition and improvement made is to promote the community’s health, happiness, and well-being,” Lau adds.
Other than Desa ParkCity, the developer is also active in Kuching and Miri in Sarawak, as well as Hanoi, Vietnam.
The MCO experience
The relevance and strength of the five “pillars” were most apparent during the recent Covid-19 Movement Control Order (MCO) as residents continued to enjoy the ease of living in a self-contained community where conveniences and amenities are well within walking distances.
“The easy access to amenities, especially daily essentials such as food, the supermarket as well as clinics, made the MCO less difficult to bear,” says Puah.
Fellow residents Liew and Chan share similar sentiments. “I walked to The Waterfront to do my grocery shopping and take away food from the restaurants. For any emergencies, we can even do PCR tests for Covid-19 at the clinic and hospital,” says Liew.
“We certainly faced no difficulty going through our daily lives during the MCO because we can do our shopping and other activities at ease. Almost everything is easily reached,” sums up Chan.
Acclimation to post-pandemic living
It was during the MCO that ParkCity launched the township’s first-of-its kind project named Park Place, designed to meet the ever-changing needs of homebuyers. Considering the pandemic and poor market sentiment at the time, the response was remarkable to say the least. The priority launch event on Sept 26-27, 2020 which was held with extra Covid-19 precautionary measures and SOPs saw more than 86% of the condominium’s 537 units sold over those two days.
The success of the project was attributed to the project’s timeless and sustainable design, which, when combined with the township’s amenities and connectivity, made it well suited to pandemic and post-pandemic lifestyle living.
For instance, the project’s green design maximises natural ventilation, now known to help reduce disease spread. The building’s orientation, ample landscaping and open spaces lower heat gain further to minimise the use of air-conditioning. Spacious common areas including lift lobbies allow for physical distancing while the fittings and finishings have been chosen for easy maintenance.
One stand-out feature of the project is seen in its common facilities. Besides the usual shared facilities such as the sky garden, there are also private spaces including co-working spaces and private nooks where one can attend online meetings, study or just to chill out alone or with a friend.
“All the attributes of a post-pandemic lifestyle have influenced the design of Park Place. The facilities, amenities and sustainability features including ventilation, space and lighting suit the residents’ new normal well-being and living environment. Other fundamental values include security and the township’s amenities,” says ParkCity’s Lau.
Indeed, the Covid-19 experience has prompted many to adopt a more sustainable and simpler lifestyle akin to the Scandinavian lifestyle where simplicity, functionality and sustainability are prioritised.
Post-pandemic, there is a greater appreciation for well-designed fuss-free homes that offer easy maintenance, practical layouts and spaces that are flexible enough to be multi-functional. Connectivity and convenience have also become more prioritised to ensure all one needs are easily available if a lockdown occurs.
Exciting upcoming project
Like Park Place, we can expect the upcoming project in Desa ParkCity to be unique in its own way but just as exciting as all its previous projects. There is no doubt it will meet the needs of post-pandemic living, complete with all the hallmarks of excellent sustainable communal living. Watch this space as more will be revealed!
Interested to know more about Desa ParkCity? Click here for more information!
Zoopla said house prices fall when there are forced sellers, which they don’t anticipate.
However, they said they do expect buyers to become more price sensitive which could lead to fewer sales and lower price growth.
The property site said this is due to the number of homeowners on fixed-rate mortgages, which protect them against interest rate rises in the short to medium-term, the stress tests carried out on those loans, and the healthy employment market.
Higher borrowing costs will start to impact new buyers.
Although house prices may not be growing as fast as they were, the rate of annual house price growth is steady.
With this in mind, owners considering whether now is the right time to put their house on the market are urged to act now according to Gráinne Gilmore, head of research at Zoopla.
She said: “Buyer demand is still strong in the housing market, but signals are emerging that the impetus may be easing, so those who want to make a move should investigate their options sooner rather than later.
“In addition, mortgage rates are likely to continue to climb, so locking into a rate shortly could save hundreds over the longer-term.
“There are many factors supporting the price growth seen since the start of the pandemic, not least the continued imbalance between demand and supply, but the increasing cost of living, increasing mortgage rates for buyers and cloudier economic outlook will act as a brake on house price growth through the rest of the year.”
The average UK property price has remained broadly unchanged this month, rising by just 0.1% since May, according to our latest House Price Index.
That’s the lowest rate of monthly price growth since December 2019, while the quarterly growth of 1.4% is the slowest since March 2021.
Year on year, property prices are up 8.4%, down from +9.2% in April and the rapid house price growth seen across the UK since the start of the pandemic has finally peaked.
Find out how much your home is worth
Demand for properties still remains strong at 40% above the five year average, but that demand is beginning to decline week on week, as the market returns to more ‘normal’ conditions.
With that in mind, sellers looking to capitalise on gains made during the pandemic-driven property boom should act sooner rather than later.
Let’s put you in touch with an agent
The proportion of listings where asking prices have been reduced is also rising.
One in 20 properties (or 5.1%) showed a reduction of 5% or more in May. That’s up from 4.7% in April.
The average price reduction is 9%, which, when applied to the average property price, equates to a discount of around £22,500.
That said, the number of new sales agreed is 21% above the five year average, showing there is still plenty of appetite among buyers, so now is still a good time to sell.
Gráinne Gilmore, Head of Research at Zoopla says: “Buyer demand is still strong in the housing market, but signals are emerging that the impetus may be easing, so those who want to make a move should investigate their options sooner rather than later.
“In addition, mortgage rates are likely to continue to climb, so locking into a rate shortly could save hundreds over the longer-term.
“There are many factors supporting the price growth seen since the start of the pandemic, not least the continued imbalance between demand and supply, but the increasing cost of living, increasing mortgage rates for buyers and cloudier economic outlook will act as a brake on house price growth through the rest of the year.”
Wales continues to be the hottest UK property destination, registering the highest price growth yet again at +11.4% year on year.
While this is down from a high of 13.4% in February, homes in Wales have risen by an average of £32,000 in the last 24 months, taking the typical house price to £192,500.
Homes are also selling like hotcakes in the South West, where properties are taking just 19 days to sell, subject to contract, from first being listed.
The South West has been basking in high levels of demand since the pandemic began, as buyers swiftly prioritised rural and coastal settings as their places of preference.
A similar picture is emerging in Bournemouth, where price growth is up 10.2%, making it one of the cities with the highest levels of growth in the year leading up to May 2022.
That said, these speedy sales are expected to slow this year, as buyer demand for homes in the South West is seeing one of the sharpest declines over the last month, down 16%, despite demand for houses remaining 37% above the 5-year average.
Across the UK, the average time to sell (that’s the time between when a property’s first listed and when it becomes sold, subject to contract) is rising.
It’s now 22 days for May compared with 20 days in March, while the time it takes to get to the point of exchange is now averaging around 170 days – around five and a half months.
All of this suggests that buyers who want to move this year should consider putting their home on the market now.
The holiday lettings industry has also played its part in boosting buyer demand since the pandemic began.
Around one in five purchases in the South West in 2020-21 were additional dwellings.
In the North of England, this figure was 26%, while in the capital it was 29%.
When it comes to cities, Nottingham scores the highest price growth, with prices up 10.4%, year on year. The average home here now costs £190,300.
Nottingham’s closely followed by Bournemouth, where prices are up 10.2%, and the average home will now set you back £333,400.
London continues to show the slowest price growth, with average property prices up +3.9% year on year, rising £30,000 over the last 24 months to £516,100.
Homes in London are currently taking the longest time to sell at 35 days.
The London market has been lagging behind the rest of the UK since the pandemic began, with the capital showing the humblest levels of house price growth since February 2020.
However, the tide is turning for the city. Buyer demand remains higher than the 5-year average – and 35 days to sell is significantly lower than the five year average of 50 days for May.
Meanwhile, prices in Aberdeen are down 2% on the year, a decrease of £6,400 over the last 24 months, meaning the average house price is now £140,200.
As the cost of living continues to bite, mortgage rates are rising as the Bank of England increases interest rates in an attempt to combat rising inflation.
Buyers are facing average rates of 3.37% for a five-year fixed-rate £250,000 loan now (with a 25% deposit), compared to 2.64% in December.
That means the annual cost of a £250,000 loan has increased by £870.
If five-year mortgage rates continue to rise by more than another basis point, taking them to around 4.62% (levels last seen in April 2010), the annual cost of a mortgage repayment would climb by £2,500, compared to December 2021.
Interest rates rise to a 13-year high
The rate of house price growth is expected to slow to 3% through the rest of the year, with prices rising at less than half the rate registered last year, where they were up 8.4%.
However, property prices are unlikely to decline as demand for housing remains high, despite falling back from record levels.
And the stress-testing for mortgages introduced since the global financial crisis means that many homeowners have proved their income can withstand rising interest rates.
That means the number of forced sales, which have a negative impact on pricing, is likely to remain limited.
The recent announcement that stress testing rules will be adjusted for borrowers, so they’ll no longer have to prove they can afford repayments at the Standard Variable Rate +3%, will mean some additional borrowers will be able to access loans, especially first-time buyers.
Mortgage affordability rules relaxed by Bank of England
However, the move is unlikely to make a significant change to lending levels, as the general rule for lending to be limited to 4.5 times a borrower’s income remains in place.
Plus, the majority of homeowners are also locked into a fixed-rate mortgage, meaning they are protected from the current interest rate moves.
Fortunately, the UK is currently enjoying a buoyant employment market, helping to offset the more challenging inflation environment for now.
House price growth remains strong by any measure. The levels of annual growth seen over the last couple of months are the highest since late 2016.
However, there are now signs that the market is beginning to ease, despite demand levels remaining 30% above the five year average, as that demand is beginning to fall back from record peaks.
The market is still moving very quickly, but the time between listing a home for sale and that sale being agreed is starting to creep up, as the market returns to more normal conditions.
The economic outlook, and multiple base rate rises, are expected to lead to slower activity throughout the rest of this year.
That said, 1.2 million homes are expected to change hands across the UK in 2022.
If you’re looking to buy a home, it’s best not to delay. House prices will continue to rise this year, albeit at a slower pace than we’ve seen over the past two years.
And Interest rates are likely to continue to increase, as the Bank of England tries to combat rising inflation, making borrowing more expensive.
If you’re looking to get a new mortgage or to remortgage, it’s best to choose a fixed rate option with the lowest possible interest.
NBA free agency is here. As of 6 p.m. ET on Thursday evening, teams and players can officially begin negotiating new contracts. However, NBA fans didn’t have to wait that long for some major news. Just hours before free agency opens, Kevin Durant requested a trade away from the Brooklyn Nets. The K.D. request is sending shockwaves around the league, and having one of the best players in basketball on the trading block will dictate how many teams operate this offseason.
So what about the other top available players? Zach LaVine, James Harden and Bradley Beal are among the biggest names in this free agency crop, but all three are expected to return to where they ended last season (Chicago, Philadelphia and Washington, respectively). Beal does exactly that early on, agreeing on a five-year $251M supermax deal with the Wizards.
Even if those players don’t change teams, some talented players are expected to find new homes. One such player — Jalen Brunson — has reportedly agreed on a four-year, $110M deal with the New York Knicks. Also, former No. 1 overall pick Deandre Ayton could depart the Suns this summer. Hornets forward Miles Bridges, meanwhile, is a restricted free agent but was arrested in Los Angeles on Wednesday.
Looking to keep tabs on the notable free-agent decisions in one place? CBS Sports has you covered with our 2022 NBA free agency tracker. Catch up on the latest moves below.
The last time this property was on the market, it had a pending offer within three days. For one reason of another, that offer didn’t stick. It’s up for sale…again!
When we say “the last time it was on the market,” that wasn’t long ago. We first found out that the property was for sale in late April 2022. For 17 years, it was home to a one-of-a-kind, only in Idaho corn maze. The property we’re talking about is Linder Farms!
Facebook/Linder Farms LLC
The Halloween attraction, which was also home of the official corn maze of the Boise State Broncos, announced in March 2020 that their upcoming season would be its last. We’re not shocked that the owners were flooded with kind comments and well wishes. We’re also not shocked that a lot of people had questions about what would become of the location.
Photo by Marius Ciocirlan on Unsplash
The owners addressed those questions in a Facebook post reading:
“Some are asking what the future holds for the property. The answer is not yet determined. We have decided to make this our final season primarily because it is time for our lives to go in a different direction.”
Shortly after the season concluded, fans learned that the farm would become Guardians Academy, a skills-based trade and outdoor academy. When the news broke, KTVB reported that the academy would lease the land from the family who owned Linder Farms with an option to buy it after five years. The farm still hosted a small fall festival and pumpkin patch in the fall.
Photo by Olivia Bauso on Unsplash
We’re not sure what fell through, but Guardians Academy is no more. They shared the following message on their website while announcing the academy would close on January 28, 2022
We have been truly blessed and fortunate to have had this time with all of you, with your children and with our incredible educators. We are grateful for the opportunity to have been able to plant the seeds of a new and different model of education here in the Treasure Valley. We are grateful for your faith in what we do and for your bravery to try something new. We hope that you will continue forward and not only ignite the embers within your children but those around you as well! Thank you for everything.
The Fiest family liquidated their equipment, commercial kitchen supplies, tractors and other supplies through an auction and put the property up for sale.
Dana Peterson/Silvercreek Realty Group
The sale includes a 6,179 square foot, 7 bedroom, 6 bathroom home and the iconic, three-level, 7,776 square foot red barn. It sits on 14.72 acres. The listing states that the future land map of Kuna shows mixed-use/development potential. The listing, once again, has an asking price of $3.6 million. That’s how much they asked for the first time around.
It’s always tough saying goodbye to a business that has truly felt like an old friend. These are the businesses the Boise area has said goodbye to in 2022.
From hikes to waterslides to kayaking in beautiful blue waters, there’s no shortage of fun things to do in Idaho this summer!
Elite Pharmaceuticals, Inc. (OTCQB:ELTP) Q4 2022 Earnings Conference Call June 30, 2022 11:30 AM ET
Company Participants
Nasrat Hakim – President and CEO
Robert Chen – Chief Financial Officer
Dianne Will – Vice President, Investor Relations
Conference Call Participants
Operator
Good morning, ladies and gentlemen. And welcome to the Elite Pharmaceuticals Conference Call. At this time, all lines have been placed on a listen-only mode.
Before management begins speaking, the company has the following statement. Elite would like to remind their listeners that remarks made during this call may contain forward-looking statements that involve risks and uncertainties that are subject to changes at any time, including, but not limited to, statements about Elite’s expectations regarding future operating results.
Forward-looking statements are made pursuant to the Safe Harbor provisions of the Federal Securities Laws and represent management’s current expectations. Actual results may differ materially. Elite disclaims any obligation to update or revise its forward-looking statements, except as required by law.
More complete information regarding forward-looking statements, risks and uncertainties can be found in the reports Elite files with the SEC, which are available on Elite’s website at elitepharma.com under the Investor Relations section. Elite encourages you to review these documents carefully.
With that covered, it is now my pleasure to turn the floor over to your host, Mr. Nasrat Hakim, President and Chief Executive Officer of Elite Pharmaceuticals. Sir, the floor is yours.
Nasrat Hakim
Thank you, Matthew, and good morning, ladies and gentlemen. Thank you for joining us today. My name is Nasrat Hakim. I am Elite’s Chairman and CEO. This is our earnings call and with us for the first time is our CFO, Mr. Robert Chen. Robert joined Elite on May 5th. His primary focus has been to work on the 10-K.
Robert will speak to his background in few minutes. I am just very happy that he has experience in taking the private company all the way to NASDAQ. He will be an excellent addition to the executive team. Welcome aboard Robert. I would like to thank Marc Bregman for his service to Elite during last year.
As with our usual format, Robert will give us a summary of the company’s financials. After which I will come back with a corporate update and answer some of the questions that we submitted to Dianne. I am delighted to introduce to you our new CFO, Mr. Chen. Robert, you have the floor.
Robert Chen
Okay. Thank you, Nasrat. And thank you to everyone to join our Fiscal 2021 (sic) [2022] Year End Conference Call today. As you have heard Nasrat introduction, I am Robert Chen, Elite new CFO. To give you a brief background about myself. I am a CPA and I have over 25 years of financial and operational experience with a primary focus on life science companies, both public and private, ranging from preclinical development to commercial operations.
Prior to join Elite, I most recently served as Vice President of KBP Biosciences. I have also previously held the CFO position at Victory Commercial Management. I believe the highlights of my working experience can be better summarized as follows, leadership in transitioning the finance department of a private corporation to a public NASDAQ listed corporation and I have done three times in building startup pharmaceutical company, the financial operation, internal control infrastructure from scratch.
With that background, I am going to move to introduction of kind of financial overview of an income statement and our balance sheets. Yesterday we filed our 10-K for the year ended March 31st. Elite is on the March fiscal year, a copy of the 10-K is available in the Investor section of our website at the elitepharma.com. It is also on sec.gov and many other websites that provide links to our filings.
Now I would like to give you an overview of the financial and some commentary as well. Starting with the income statement, we had record sales of about $32 million this fiscal year, up about $7 million or 27% compared to last year. This is the primary due to the strong sales of the generic version of Adderall, Naltrexone tablets and the Loxapine capsules.
Well the important fact here I want to point out here is, our sales have been only upward trend from $8 million in the fiscal year 2019, $18 million in 2020, $25 million in 2021 and now $32 million this fiscal year. Without a doubt this year Elite has achieved our highest revenue in Elite’s sales history. In a period of four years, the company’s revenue increased by 400-fold — 400%.
Now I will move down to other P&L section, we come to cost of goods sold, as a general rule, the cost of goods sold pretty much reflect direct proportionately to our increase in revenue. We also post an operating profit of about $5 million, $3 million over last year due to the strong revenue.
Our operating expenses maintained at the relative steady level at $9.7 million for this year and $9.8 million for prior year, even though our sales has — have increased by 27% over last year. This is a sign that Elite demonstrated its great strength in operating efficiency.
Our net income reached $8.9 million versus up about $3.8 million up 75% compared to last year. Including in the net income are some adjustments related to other income, which includes a positive fair value adjustment or our derivative instrument about $1.4 million pick up and another pick up on the deferred tax benefits of about $1.7 million.
The deferred tax benefits were recorded because the company has started to generate positive net income during the past two years. As such, the company believe is appropriate to utilize the net operating loss carry-forward incurred during prior periods. Our calculation of a deferred tax benefit was based on a two-year positive net income projection.
In summary, the operation results are truly a remarkable accomplishment by Elite management team, including an upward trend for both revenue and the income, while being able to control its operating expenses. One key impact to know is that this increased revenue and the cash flow in particular will help to support our product pipeline development.
Now let’s move down to our balance sheet, our working capital stayed at a strong level about $12 million, up $6 million or a nearly 91% increase over the prior year. Our cash from operating activity reached an impressive $6.5 million or $3.5 million increase over last year and our total cash on hand is about $8.9 million at March 31, 2022. This is mainly attributed to our strong sales and ability to control our spending. Again, the bottomline is that Elite is a profitable and has a stable and financial outlook.
This concludes my financial review. I will now turn it over back to Nasrat for an overview on the company.
Nasrat Hakim
Thank you, Robert. Today’s update will include a few comments about Elite financials echoing what Robert just told us then cover safety research and development pipeline, and commercial products. Before we go to Q&A, I will also talk about opioid strategy. The purchase of the new buildings, a lot of people are interested in that and potential partner of sales and marketing force.
Regarding safety, we are operating in a once in a life pandemic. COVID-19 is a pandemic that is affecting us all. It is affecting Elite, our suppliers, service providers and sales and marketing partners. It is affecting our business, as well as everyone else’s business in the United States and globally.
We continue following local and federal guidelines, and the CDC’s recommendations. Most of our employees are vaccinated. We are still taking all the necessary precautions to ensure employee safety, and most importantly, business continuity.
My concern regarding the effects of the pandemic and supply chain inflation on our lives and businesses continue. All it takes is one missing component to bring manufacturing and shipping to a halt for us in the United States and any other industry frankly.
To-date our commercial products have not been materially affected by the supply chain problems. That is not to say we have not been impacted. It has not been easy. We are feeling the impact on our R&D pipeline mostly in the form of delays in clinical trials. I will say more about that later.
Regarding revenues and profits, Robert hit on all the right numbers, revenues, profits and cash flow. I am very pleased with the direction the sales and marketing are going, and hope our sales partners continue on this path.
Two years ago, we did not have enough money for working capital. Today, we are self-sufficient and profitable. We have surpassed last year’s excellent performance, and just to echo what Robert said, we went in four years from $7.5 million revenues to $18 million in revenues to $25 million in revenues and this year, we hit $32 million. That is solid progress.
As I said, there were a lot of questions about the building. So I am going to start the update of the manufacturing facility with that. Around the beginning of the year, the owner of Building 135, 137, that houses our manufacturing, packaging, warehouse, quality assurance department decided to sell the building.
He is 91-year young and amazing man who has worked with us for years. He got an offer from a company that’s buying pretty much all the buildings on our street.
He was kind enough to offer us to buy the building. We still had four years on the lease, but that was it. We could not renew any more after that. So we went through a quick analysis of our options and looked at the market around us.
First, we evaluated what would happen if we move out and rent another place. The group that’s buying the area is converting it into nursing homes and extended long-term facilities. So if we moved out, we will have to rent the buildings, if we rent a similar warehouse building. First, the rental prices were twice as much. Apparently the gentleman being a wonderful 91-year old retired in Florida has not been checking on the prices and we have gotten a discount of almost 50%.
Second, anytime you move, there are certain equipments that will be a total loss. For example, we have a fluid bed that cost us almost $2 million, mostly in installation, it’s embedded in the walls and the electronics and that has to be taken out and moved.
Third, there’s the cost for clinical trials or tech transfer of all of the products that you have. So at the end of the day, when you calculate your cost if you have to move out, in addition, you have to buy new equipment in order to run the new batches there and submit them to FDA so you can get approval later on.
It will cost us actually more than the price of the building. No kidding. It will cost us about $3 million to $4 million more to move than to stay. So it was a no brainer. We went to the Board of Directors with the analysis and the Board instructed us sometime in January to move forward and try our best to buy the building and I am very happy to say that we are closing in July. This action was a very positive step for Elite. The alternative would have been much more costly.
In addition, the final comments on this, anytime you own an asset like that, it’s a positive thing. I have been a part of a company before when we needed money. We had the building that we had for manufacturing in California. We found the buyer that we actually sold them the company under the condition that they lease it back to us at a premium. So it is not a bad way also to raise cash in the future once we have built in equity. Right now we pay for about half of it and finance the other half. Our payments per month now are a lot less than what they were before. That is the rent is a lot less than the mortgage.
Regarding R&D, Elite continues to spend significant amount of research and development on the research and development. It is our number one priority and number one focus. Our goal is to create a new set of products that are diverse enough that they stabilize the company such that in case we get hit on one or two products that are material to us such as Amphetamine IR and ER, the company will not suffer materially and at least can survive. The more pillars we can add to stabilize the company, the better it is for all of us.
As you know, we received an ANDA approval for the Generic Sabril. Elite is working on a number of other generics as well. Currently, we have three clinical trials that we signed contract for. One will be done in the U.S. and two in India. Two of the three are difficult products and take longer than average time to execute the clinical trials.
The clinical trials are one of these things that got affected by COVID. There are different regulations that they have to apply to protect the patients, the import/export licenses. So this has had really some impact on us. I was hoping that by now for one of the products we would have results of the clinical trials instead the company has not even started the process. Again, you can only operate within the atmosphere that you have and this is today’s atmosphere, things are moving slower than usual from our CROs and we have to work with that.
The bottomline is this, we have many opportunities that are currently being pursued. We have six ANDAs that are — at R&D level that are well-developed and we have a total of 12 that range from early development all the way to clinical trials.
This year 2022 we have received two approvals from FDA. One ANDA for Doxycycline tablet, a product we co-own with SunGen/Praxgen and the other is the Generic Sabril, which is owned by Elite.
Regarding Doxy, we will be working with our partner to determine the next step. Praxgen/SunGen have their own thoughts of they want to do. They really want to move forward with it. And we need to negotiate with them and figure out how are we going to handle that.
Genetic Sabril, the sales and marketing has been licensed to Lannett and this is an agreement to work out with Lannett almost a year ago. This product includes REMS component that we will have to work with Lannett over the next few months in order to implement. This is the product that you need a specialized pharmacist, physician and patient all educated on how to take it in order to take it.
Regarding the rest of the commercial products, Amphetamine IR or ER are two products that are in a very competitive market. We have done very well. They have done very well for both of us, Lannett and Elite. We are happy with the job that Lannett is doing. As stated before, Lannett has an approval for Amphetamine ER and waiting for this approval for the IR. We have not received an official notice from Lannett wishing to terminate the sales and distribution agreements for this product. So they are still officially and are our partner.
But we are taking all necessary measures to protect Elite if that happens, such as when evaluating other sales and marketing partner in case if this happen or we are evaluating whether we can do it ourselves. To that end, if we are going to do it ourselves, there are lot of things that we need to do way in advance. We cannot wait till we receive notice from them, because one of the things you need is to be licensed in all 50 states and it takes a minimum of six months to get licensed in all states. That’s because each state has its own requirements, ranging from just send me a check and you get a license to, we need the $100,000 bond, FBI and state background checks, fingerprinting and the works. So far, we filed about 35 state applications. We expect the rest will be done within the next two months.
We are also interviewing three PL companies, third-party logistics for distribution and evaluating whether we want to do the distribution ourselves and comparing the pricing. In order for us to launch a product we need somebody who either have third-party logistics or we need to start our own distribution center. So we are looking at the cost and effect of both.
And finally, we are feeling out the market and interviewing or talking to potential VPs for sales and marketing. Again, this is a complex operation that’s going to require a Vice President for Sales and Marketing to be able to handle it.
Having said all of that, let me emphasize, it all may amount to nothing, as we may stay with Lannett, but the stakes are too high for us not to be ready in case they decide to move forward on their own.
Having our own sales and marketing team is something that I have always wanted for Elite. I was planning on it once we get four more ANDAs. This just may accelerate the process. Enough said about that.
Loxapine, we launched last June and it is one of the products that really was affected by the supply chain. Our partner, Prasco, who marketed under their brand Burel were going to take bids to get a small business and we couldn’t because one of the components that you make that product with was in short supply. So we could not promise to double or triple the business because we could not deliver and then we will end up in a problem where we have to pay for failure to supply.
So we are working through that. They are doing well with it now and I hope they will do better once we resolve the supply chain issue. We expect to resolve these issues and expect future growth from this product, hopefully, within the next six months or so.
Isradipine and Trimipramine, Epic is our partner with these products. They are interesting products in that. They have limited competition. With Epic, we are seeing a little more profit and revenues and we hope that continues.
There are many questions about NASDAQ. I always get asked about that. So we have discussed NASDAQ many times before and I will say the same thing again. A key goal for Elite is to uplist the NASDAQ. When the time is right, everybody remember the first part, but not the second part, when the time is right, there are specific requirements that Elite must meet to qualify for the uplisting. We are working diligently to achieve them.
Going from $7.5 million in revenue to $32 million is a part of that, but we are not there yet. We will continue to monitor our growth and income generation and we will update you on the uplisting when the time is right.
I will not and have resisted for years going to NASDAQ on the fundamentals we have. Because if we do have a reversal split whether it’s 10 or 20, whatever it is to get us to NASDAQ and then when we get there, we don’t have the right fundamentals and we gravitate back to the OTC Board, everybody at the sound of my voice would lose 10 to 20-fold their investment, okay. And that could happen very easily. This is why even though it’s lucrative and you would be in NASDAQ for a short period of time and it’s not the right thing for any of us unless we get to the right fundamentals. And if it happens, it happens, it happens tomorrow fine. It happens in 100 years fine. I am not going to do it and risk the company going through what a lot of companies going through and that is gravitating back to the bulletin board.
Okay, to wrap this up, Elite is executing on its growth plans, working on new product approvals and capitalizing on its commercial product lines. Our sales and distribution partners are performing well. We look forward to another profitable year.
As always, you have sent Dianne a whole bunch of questions. Many of them are repeat and others are within the same family. So she divided them into categories and we will try to address those next.
Before I start, a gentleman sent an email with a late question that Dianne passed on to me asking about if we have any other communications with Pfizer since I mentioned them before? And the answer is no.
I have already given the update on the building. So I am not going to repeat that again and our partnership with Lannett or potential other partners. If there is a question that’s tangential I will address it. If not, these three have already been taken care of.
Question-and-Answer Session
A – Nasrat Hakim
The first question is about Praxgen, SunGen and Elite. So the first question is, is the partnership with Praxgen basically the same as it is with SunGen, have we project then how many projects have been added or dropped?
So let me explain something in here. SunGen was sued by Sun Pharmaceutical. Sun Pharmaceutical is a huge international pharmaceutical and SunGen moved into an office not too far from them.
When they saw the name SunGen, they thought they are trying to pull a fast one on them and convince people that they are Sun generic division. So they filed a lawsuit and force them to change their name. So it’s the same company. They just happen to change their name.
Everybody thinks that Praxgen bought SunGen and why aren’t we working with them. They are still the same company, that’s fine, suffering from financial hardship that they lost their Chinese supporter. They just changed their name, that’s all, okay. So the partnerships that we had with SunGen are the same as Praxgen because there’s nothing but change with the name.
Now the only thing we have in common with them is what was pending. Everything else we dissolved and moved on. The only thing that I was spending was Doxycycline tablets, ANDA and capsule know-how, that’s it. Other than that, we have no business with SunGen/Praxgen except they are friends, they know us, they call us, we call them and that’s about it.
There is no collaborations, no R&D, nothing else, except for these two products. And we need to reach a resolution for them sometime soon. Actually, it’s one product and one know-how, okay. The rest of the questions — a lot of questions about the same thing, Praxgen versus SunGen and when they bought them when they can buy us, it’s the same company.
What is the approximate total market value for the drugs we are working on with Praxgen? Again, it’s Doxy tablets and capsules only. Products that we have left with SunGen only these two.
Why did SunGen sell its 50% interest of Adderall or why didn’t Praxgen want to keep it? Again, it’s the same company. They sold it because they really did not have the money. They would have loved to have kept it. On a side note, this is from the co-CEO, the best and most successful relationship they had was with us that’s produced Amphetamine IR and ER.
And they would have loved to have kept that and made money, except they lost their Chinese financer and when they had no more money and a ton of things that they are working on and employees, they needed a cash infusion and that’s why they came to us. Elite did have the money and then end up selling it to Mikah. They were desperate for money and they wish even until today, they had the money to keep it, okay.
Research and development, product pipeline. We were co-developing a fairly big CNS drug with SunGen, and then it got put on hold. Is it back on again with SunGen or Praxgen? We acquired the right to proceed with the — that product, the SunGen levered system product. So we will be proceeding with it ourselves. Actually, we are working on it.
There are supposed to be another drug approval in Q2 of 2022. Did Elite receive a complete response letter? No, no, we had two approvals, Doxy and Generic Sabril. Generic Sabril, I think, is what you are talking about. And of the two, only one counts toward the ANDAs that I promised we are going to come through on. Doxy does not count for that. It was left over from last year.
A question on my compensation and why can’t we pay him in cash? I love you, I love cash, please start paying me cash. The Board changed that. I get half — I actually get my salary in cash and I get my bonus in stocks now. In old days, I used to get everything on stocks. Now I get my salary in cash and my bonus in stocks.
Again, another question on Doxycycline. When will Doxycycline be marketed? As soon as we resolve the issues with SunGen, figure out what they want to do. We cannot proceed ourselves without them. The ANDA is in their name and once we do, we will let you know.
Have you ever considered promoting the use of methadone in the prison and jail system? It could save lives and reduce reoffending. Dianne sent me this question, actually, first, I wasn’t going to read it, because we don’t have methadone anymore. But then I really decided to because this person has a heart and this is not a bad idea, actually. It will be very difficult for a little entity like Elite to penetrate through state and federal prison system and figure out what they have and don’t have and support them. But this is not a bad idea for somebody else, okay. And also, that’s an opioid and then you need opioid insurance and also a host of problems. So it’s not the right thing for us, but a brilliant idea. Is there a difference between jail and prison?
Robert Chen
No.
Dianne Will
No.
Robert Chen
Yeah.
Nasrat Hakim
A financial question for Nasrat. I don’t know, they are given Robert to break, I guess. Do the end — year end results include revenues from Dexcel? And the answer is no and let me explain that. We are working with Dexcel to launch our product in Israel, okay.
They need to get approval from the Israeli government before we do that and that involves a ton of work. Our team, not only regulatory, but the entire team have been working very hard with them to get them all the papers they need in order to get the approval.
Now there is a reciprocation between Israel and U.S. So they don’t have to do the clinical trials again, but they have to submit all of the paperwork for the ANDA and run a few tests in vivo or in vitro, actually, test before we can do that.
So we are going back and forth with them and I hope that they can conclude this sometime soon. And after they finish, then there is a waiting period by the Israeli Government. So I am not expecting anything is going to happen for at least six months, if we are lucky, okay.
Things move slow in regulatory agencies. But this is a product that’s still alive. Our partnership with Dexcel is very exciting. We are hoping this will be a success and there will be other products we can collaborate on, whether it’s for the U.S., I mean, for Israel or Europe, okay.
Has Elite suffered from discontinued API procurement? No, we have not. As I mentioned earlier, not API procurement. One of our products, Loxapine, had one of the components, not being as available for us to be able to bid more, but it wasn’t the API and we have never had any issues with API. So we have done a very good job on that.
Can you please provide more color around the market size for the four ANDAs that are coming? I honestly can’t for multiple reasons, but I am going to give you one right now. Any time we file four ANDAs, we start the clinical trials and that ANDA, let’s say, is going to bring in $100 potentially, and then you work on other ANDA that’s going to bring in $1.
You don’t know which one is going to get through the clinical trials, get the FDA, get approved. So I cannot tell you what is the universe for these ANDAs, because I don’t know what’s going to get there first, okay.
The eight ANDAs we are working on out of the total of 12 are substantial. ANDA are about what all the big boys and girls in the market working on, okay. So we will be throwing our head in with the big boys and see what we can do. Some of them are similar to Amphetamine ER and some are similar to Loxapine and everything in between, okay.
As an investor, I was happy to see a PR in Micro Cap Daily and I apologize for never hearing about it. Dianne have to explain to me. Do you plan to have more PRs in 2020? We will always issue press releases for PR worthy of news, okay. We are not going to just issue PRs for sake PRs. Any time there’s something that is relevant, we will update you guys.
NASDAQ, what our current NASDAQ plans? I already explained that. From the transcript dating back to 2017, you said that you are going to go to NASDAQ. Now it’s 2022, does you not realize that people like me are reading and following everything he says? Yes, I am hoping that you are following the fact that I am really saying we want to go to NASDAQ, but we are not going to do it until we have fundamentals and unless we have the fundamentals, we are not going to do that, okay. To go to NASDAQ, just to go to NASDAQ have a reverse split and go there with the debt is detrimental to all of us.
Is there any activity in R&D around ADT technology currently, okay. That will be the last question. I will take actually the last question there is and let me answer it this way. The landscape in the world of opioids is changing, okay. Historically, Purdue did not do all the ethical things that you should in marketing OxyContin.
The federal government sued them. The politicians jumped on the bandwagon and start declaring the big bet, pharmaceutical companies are doing the wrong things and are causing a pandemic and drug overuse — overdoses in America and they got a lot of milage out of that, too.
Later the states saw dollar signs and they also jumped on the bandwagon and they start suing everybody and their cousin as well. When they saw money, they stopped suing just Purdue, they started suing generic companies that the FDA approved their product and they are used for the intended use. Generic companies do not have the capability of changing the labeling. You follow the labeling of the brand, okay.
So when you go there and FDA says, yes, this is what you are supposed to make and this is the label you put on it, unless you are selling it illegally on the street, you are doing what the law told you. But all the states start suing and they made a ton of money as well. Of course, when we saw of this, we got out of town. We don’t want to get sued because even if we win, we cannot handle the litigation part. It is my understanding that things are changing.
Now in Congress, they are getting lots of complaints that the person whom the drug is made for, the person who’s in pain, who has cancer, who has a surgery, who has arthritis, that are the users of 99.9% of the drugs. Nobody is thinking about them. Everybody is seeing about the junkies and the abusers.
So the Congress couldn’t shift overnight. Otherwise, they look like hypocrites. I am not sure if that will bother them. But they are now listening. And they are seeing that, okay, we first sued everybody and their cousin, there’s nobody else to sue.
Then we demanded REMS where every single doctor now gets educated on opioids, they can only prescribe certain amount to a patient, that the pharmacist get educated on same thing, that the pharmaceutical companies are creating marketing surveillance, that we have serialization where every single bottle we manufacture can be traced to your house. All the FDA have to ask is where is this bottle and we can actually have the supply chain to trace it all the way to the end user.
The movement is going in the direction where, hey, if a person complies with REMS, with regulatory surveillance, with serialization and they do not break the law and selling to a specific pharmacy like the guy sold to Florida firm where single Florida pharmacy more than they sell to 10 other states, then maybe they are protected from lawsuits or at least they will put parameters where if you meet this criteria, you shouldn’t be sued.
I don’t think that’s going to happen overnight and my gut feeling is that over the next three years, Congress will act on that. Well, for us to be back in the market, it’s going to take us at least a couple of years to get there.
As was announced, we are working on Oxy ER. We have to do certain studies that will be concluded by Q1 of 2023. And we will be filing the product that takes the FDA another at least year to evaluate it, so probably end up filing it in Q2. It takes them a year.
And pending lawsuits and maneuvers from Purdue to delay us like the delay in the industry, things could come together and we may be one of the first ones once we have that Safe Harbor that Congress acts that opioids are okay.
Right now, come hell or high water, I am not getting into the market. And I have said before to the investors, to the stockholders and to my staff, we cannot even find the company, insurance company that would insure us for opioids.
We cannot find a partner that will take on that burden and we do not have the money to defend ourselves and none of the little products we have, Oxy doesn’t highly hydrate that [ph] for a small company like us, would have brought enough money for us to make it worth it. And Oxy ER anti-abuse may bring in enough money for us to be able to buy the right insurance or to take a risk. All of that can be handled in the future, pending what the legislators do.
But again, one more thing we try to be careful with and not miss an opportunity by preparing with our know-how knowledge, clinical trials, to be next in line in case if it happened and if it doesn’t happen, we lost some money. If it happens, that will be a huge return for all of us.
That would be it for today. That was the last question. I will talk to you again in six weeks. Thank you for listening today, and thank you, Operator. Thank you, Matthew.
Operator
Thank you, ladies and gentlemen. This concludes today’s event. You may disconnect at this time and have a wonderful day. Thank you for your participation.
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