We are short BioDelivery Sciences International (BDSI), a money losing opioid manufacturer that is connected to Dr. Frank O’Donnell, Jonnie Williams’ long-time business partner.
- Dr. Frank O’Donnell and Jonnie Williams are business partners whose companies have a 30-year history of stock wipeouts, SEC investigations, shareholder lawsuits, and even bribery of a governor.
- BDSI engages in questionable business practices similar to Insys & Purdue Pharma – co-pay cards for free opioids; paying suspect doctors; and convincing doctors to increase dosage.
- However BDSI is different from other opioid companies in that they burn through cash hand over fist. Over $6.5m of negative Free Cash Flow from Operations per quarter!
- 10-K disclosure around the Teva settlement shows that a generic Belbuca could be coming much sooner than management has indicated.
- Cherry Bekeart (of MDXG and EBIX infamy) is BDSI’s auditor.
- Insider Selling – Investors should sell when Frank does, and he is selling! Broadfin Capital who joined the board in 2018 also filed to sell 100% of their stock which is 17.4% of BDSI’s float.