Genflow Biosciences: Annual General Meeting and Partnership Strategy – ICYMI

Dr Eric Leire, CEO of Genflow Biosciences Ltd (LSE:GENF, OTCQB:GENFF, FRA:WQ5), spoke to Proactive about the company’s latest RNS regarding its upcoming Annual General Meeting (AGM) and the strategic rationale behind authorizing the potential share issue ahead of clinical partnership discussions.

Leire addressed potential shareholder concerns and acknowledged that announcements related to share issuance can sometimes be interpreted as a fundraising signal. However, he clarified that the RNS is not about launching a capital increase, but rather about strengthening the company’s position in current and future negotiations with the main pharmaceutical partners.

He explained that in biotechnology, financial flexibility directly translates into leverage. “In biotechnology, cash is not just money, it is bargaining power,” Leire said. As a public company, Genflow Biosciences Ltd’s financial position is visible to potential partners, and Leire emphasized the importance of maintaining the ability to walk away from unfavorable conditions.

He added that the company is not committed to using the full 30% share issuance authority and noted that the underlying science remains unchanged. “Our science hasn’t changed. What we’re doing is just making sure we capture the full value of our science,” he said.

While acknowledging that markets do not like uncertainty, Leire stated that uncertainty is temporary, while signing a bad deal would have long-lasting consequences. He said the company is focused on optimizing for the best long-term outcome and ensuring it is not forced into a suboptimal deal.

Proactive: Eric very good to talk to you. You issued an RNS this morning noting your upcoming Annual General Meeting, and also talking about discussions with partners. Can you tell us more about that?

Dr. Éric Leire: We fully understand that shareholders may be frustrated by the RNS we issued today. We don’t take it lightly. This RNS is about the Annual General Meeting, but may be perceived as a possible capital increase. Normally, we know that the share price declines when a capital increase is announced and then recovers when the strategic benefit becomes evident. We’ve seen that pattern repeatedly. So if we knew the stock price could go down, why did we create this RNS? The answer is simple. This is not an RNS about a possible fundraiser. It’s about bargaining power. What we are doing is proactively strengthening our position before entering into conversations about clinical partnerships.

Proactive: You say these are talks about partnerships, but do you think the RNS could still be perceived as an announcement about a fundraiser?

Dr. Éric Leire: Yes. First of all, technically, this RNS is not about fundraising. There are no terms. It is about authorizing the issuance of shares (30%), but this is only an authorization. We do not commit to using the full authorization. Let’s return to the objective of the RNS. In biotech, cash isn’t just money, it’s bargaining power. We want to be sure that Big Pharma won’t take advantage of us when negotiating deals. As a public company, our financial situation is visible to all potential partners. We don’t want to be in a position where we have no choice but to accept their terms. Our ability to say no to a suboptimal deal is our most valuable negotiating position. Negotiating deals will create more value than avoiding dilution in the short term. If I go back to the basics, our science has not changed. What we are doing is simply making sure we capture the full value of our science.

Proactive: It introduces an element of uncertainty and the markets do not like that. How do you approach that?

Dr. Éric Leire: I understand that the market hates uncertainty, but uncertainty is temporary. Signing a bad agreement will be permanent. I am convinced that the ability to say no is worth every penny we can raise. We are optimizing for the best long-term result. At this time, I cannot guarantee the terms or timing of the partnership, but I can guarantee that we will not be forced to close a suboptimal deal. When the partnership is announced, shareholders will understand why this is important.

Proactive: Eric, I hope you continue to keep us updated on progress on this. Thank you very much for taking the time today.