Provectus Biopharmaceuticals Inc (OTCMKTS:PVCT): Here's What Matters

Anyone that sat in on Provectus Biopharmaceuticals Inc (OTCMKTS:PVCT)'s third quarter 2016 earnings conference, and related business update, will know it was a pretty intense affair. The company gave a very comprehensive overview of the science that underpins its lead assets, and an equally comprehensive overview of the process that it needs carry these assets through in order to get them to a point where they may look attractive to big pharma, or to the FDA as a potentially approvable treatment candidate. The real action came post presentation, however, when Peter Culpepper and Eric Wachter, interim CEO and CTO respectively, opened the line up for questions.For those not familiar with the situation, at the time of the call (November 14) there were two actions set for proxy vote, which was to take place on November 23. The two items in question were an increased in authorized from 400 million 1 billion, and independently of this increase, the authorization of the company's BoD to effectuate a reverse split (RS) at between 1 for 10 and 1 for 50.Needless to say, neither of these proposals was particularly attractive to shareholders, but by far the most concerning was the potential for an RS. These are shareholders that have seen the value of their holding dissolve to a fraction of its former weight, and an RS would only add to this debasing.Well, the vote took place, and the company got the authorized share increase, but not the split. It looks like it's not going to be able to re-comply with its listing requirements as a result, and will trade OTC for the foreseeable future.What's next?The important thing to recognize here, is that this proxy vote was do or die for the company. It needed one of these votes to pass so that it can raise finance. It needs finance to allow it to get its lead asset, PV-10, to a stage whereby it can report interim phase III data in a melanoma indication. It needs to get to this point so it can start auctioning potential exits, the most likely of which (and probably the most desirable) is a big pharma partnership with upfront cash, or a total buyout as part of which the acquiring entity will take over development of PV-10 and carry it through to commercialization.A lot of questions revolved around why the company has taken so long to get to this point, and around why there's no interest from big pharma yet (at least, that is, no interest to the degree of a buyout potential).For us, Provectus had two very legitimate responses to these points.The first, because the landscape for this type of drug, in this indication, is very very competitive right now. Basically, it's having to fight for every enrolled patient. This is underlined by the host of protocol alterations (past and planned) and the opening of new locations.The second, because the drug is a completely new type of asset (when applied to this MOA; it's actually a century old in various other applications) and potential acquirers are demanding some kind of evidence it works before committing. They're not willing to settle for anything sub-interim phase III, and this brings us to our previous point about the need to raise finance.It's an interesting situation from an onlooker's perspective. Yes, it's incredibly frustrating for shareholders, but if those holders are going to see any degree of return on their capital, they are going to have to stick it out. There's a planned rights offering that will allow for non dilutive acquisition, which should take the edge of the situation, but only to a limited degree.We think the company has a solid asset, and one that has huge potential, but for whatever reason (delays, extensions, unexpected costs, increased competition for trial patients) it's taking a lot longer than anyone would have liked to get it to a point where its saleable to a big name.There's a clear benefit to holding a preexisting exposure right now.We will be updating our subscribers as soon as we know more. For the latest updates on PVCT, sign up below!Disclosure: We have no position in PVCT and have not been compensated for this article.