Pharmazen

[Basil]

Interesting article from mid last year on how funding for the biotech sector has dried up like the Sahara Desert. https://www.ft.com/content/09c3a606-d195-4f41-b69b-83a59c9e4806    With the tech wreck gaining momentum in 2022 towards the latter half of the year I would think the situation for new funding is now quite considerably more challenging.
Interestingly the sector as a whole is down 70% from the peak in early 2021 about when the new major shareholder inked their deal for support at 40 cents.  (40 cents less 70% = 12 cents so maybe as I eluded too above my 26 cents is far too optimistic).

That ~ $14m raised was supposed to have carried them through to a much higher level of profitability but sadly, that does not appear to have happened and now they seem to want a lot more money.  It will be very interesting to see if there is any appetite from any new cornerstone shareholder or if they can float this on any market.

[lorraina]

Yes PAZ did very well with milling animal products.Still do.
Their modest freeze driers could not keep up with demand,so a huge one was added.That could not keep up with demand,so another was added.And yet another has been added at Port Hills site.
Extraction plant was built to extract Greenshell mussel oil and blackcurrants.Demand was so great for mussel oil and Krill oil they had to build another.
From what I hear extraction is their most profitable plant.
They have reached capacity at Port Hills Road site.
Most new secret new products are driven by customers asking can you do this. PAZ is a customer driven business.
So today we have Port Hills site complete,Rolleston one 90%,and a start has been made on Rolleston two.   
Interesting noting Rolleston One has a cool store section
Should PAZ need to raise further capital I will support it,as I know they have/are spending their capital productively..

ps  Cibus  Fund..I do not think they are a PAZ customer,just an investor. in some very exciting companies.
The Cibus Fund, advised by ADM Capital Europe, invests growth capital into sustainably run food and agriculture companies across the globe.
https://www.cibusfund.com/portfolio/?fund-type=private-equity-portfolio

[Sideshow Bob]

While the sector maybe cooling, I think you can't tar all companies with the one brush. Alot of the "biotech" sector is built on hype and bullsh!t IMO - and PAZ doesn't fit into this category.

From the outside it seems much of the focus has been on plant/capacity expansion - which has no doubt taken longer, cost more and proved more difficult than expected due to Covid.

I'm not sure but think at least one of the Rolleston facilities might be focused on petfood? (Lorraina might correct me). This will be toll-processing presumably, so operating for other customers. Petfood sector remains hot at the moment. But would be a processing margin, not a brand owners margin - where things get more interesting. Albeit less risk/reward and expect underpins factory operations while they develop their own channels.

My main concern is executing on sales/brand. This is where the real margin is. We've seen AiOra go into hiatus (??) and nothing happen with Department of Treats. When Ziwi gets sold for reportedly $1.5B, and companies like Go Healthy getting sold at lofty multiples, their value is in their brand, not physical facilities.

PAZ have done well with their factory work and expansion and proven their technical expertise, but in my opinion just need to prove their sales and marketing ability.

[Basil]

https://www.facebook.com/AiOraNZ?_ga=2.124611978.1446093616.1673325375-835067363.1673325375
No comments on the Aiora facebook page since 1 Sept 2021.
Marketing 101 - Keep in touch with your customers and keep making your products available for sale.

[Sideshow Bob]

https://www.facebook.com/AiOraNZ?_ga=2.124611978.1446093616.1673325375-835067363.1673325375
No comments on the Aiora facebook page since 1 Sept 2021.
Marketing 101 - Keep in touch with your customers and keep making your products available for sale.

Product out of stock.

Nothing worse that having social media not updated - even just do it very occasionally to show that you are still alive.....

[Minimoke]

I'm beginning to wonder if Aiora was simply testing proof of concept. Could they manufacture tablets. Could they package them. Could they get them onto shelves.

The answer now is obviously "yes"

Could they make money at a decent margin - I suspect not.

[Basil]

I'm beginning to wonder if Aiora was simply testing proof of concept. Could they manufacture tablets. Could they package them. Could they get them onto shelves.

The answer now is obviously "yes"

Could they make money at a decent margin - I suspect not.

Could they label the supplement bottles?  Yes and No.  There were often crinkles in the labels wrapped around the thin and quite flimsy plastic bottles.  Overall, the packaging and presentation came across as "second rate" compared to other supplements I use from Swisse and third rate compared to the packaging and presentation of Blackmores Executive B supplements, (high quality glass bottle with excellent labelling), I use.  I am sorry but marketing 101 - presentation matters.  I also thought Aiora supplements were very expensive for what they are / were. 
If they want to make it in the supplements game they are going to have to significantly overhaul the presentation of their products and invest heavily over a sustained period of time in marketing.  Have they got deep enough pockets for that? 

[lorraina]

An AiOra testimonial.
These things really work !
I felt super yesterday afternoon...was almost bouncing off the walls and couldn't get my mind to stop thinking until just after midnight.
So effective its probably best to take them in the morning with breakfast so you can get to sleep at your normal bedtime.
 

[Basil]

Doesn't matter if they work or whether it's just the feel-good placebo effect if you can't buy them.
Still out of stock with everything.  You'd be forgiven for thinking these guys want to destroy any brand value they have left in Aiora.

[lorraina]

An AiOra testimonial.
These things really work !
I felt super yesterday afternoon...was almost bouncing off the walls and couldn't get my mind to stop thinking until just after midnight.
So effective its probably best to take them in the morning with breakfast so you can get to sleep at your normal bedtime.
 
Looks as though you will be able to bounce off the walls again Basil.
https://aioranz.com/collections/all

[Basil]

Sorry, but like some others due to the long absence from market I have found another supplement for my eye strain and am happy with it.

[Minimoke]

I'm not sure that will impact their revenue line

I'm not convinced selling finished product is a profitable activity. PAZ dont sperate revenue / expenses associated with Aiora so we have no way of knowing. I havent seen anything to convince me otherwise that Aiora is just a folly - somenting to give a crack. Or as they say  around modern board room tables "run it up the flag pole and see if it floats"

I'd sooner, given the hurdles faced over the past few years, they had 100% focus on maximizing production out of capital/plant. Ie ingredients.

That's said, I do like their new branding. Heres the one for Eye Health

[lorraina]

I agree with you.
I would first of all like to see the new factories up and running at full speed.
Then get themselves into a really strong financial position to really market AiOra into their target markets in Asia.
That said, the new labels and AiOra's updated web site look great.
With AiOra product 04 05 subscription would work for me.
One bottle every two months would cover the two a day I use.
20% saving .
So currently paying $29.90 for 60 capsules or 49.83 cents each.
Buying on subscription :120 capsules $36.50 less 20%=$29.20 or 24.33 cents each.
Crickey that's under half price..!!.

[Minimoke]

I agree with you.
I would first of all like to see the new factories up and running at full speed.
Then get themselves into a really strong financial position to really market AiOra into their target markets in Asia.
That said, the new labels and AiOra's updated web site look great.
With AiOra product 04 05 subscription would work for me.
One bottle every two months would cover the two a day I use.
20% saving .
So currently paying $29.90 for 60 capsules or 49.83 cents each.
Buying on subscription :120 capsules $36.50 less 20%=$29.20 or 24.33 cents each.
Crickey that's under half price..!!.

I'm hoping for a Shareholder pack at this years AGM. 1 bottle of each.

[Sideshow Bob]

currently paying $29.90 for 60 capsules or 49.83 cents each.

I agree with you.
I would first of all like to see the new factories up and running at full speed.
Then get themselves into a really strong financial position to really market AiOra into their target markets in Asia.
That said, the new labels and AiOra's updated web site look great.
With AiOra product 04 05 subscription would work for me.
One bottle every two months would cover the two a day I use.
20% saving .
So currently paying $29.90 for 60 capsules or 49.83 cents each.
Buying on subscription :120 capsules $36.50 less 20%=$29.20 or 24.33 cents each.
Crickey that's under half price..!!.

I would see it that they have likely learnt a few lessons from Round 1 of AiOra, when alot of company focus has been elsewhere, and then now are giving AiOra a rebirth. While Asia might be the main target longer term (??) - in China for example, they don't like "Made for China" brands, and it has to be a respected & well established brand in their own country.

Personally I would agree with the factories/ingredients - and that is clearly going to be the core of their business, given the relative size of their production and infancy of this product - AiOra will only ever be a small portion of their production. With all due respect to Pharamzen, this has to be recognised at this stage at least as a bit of a side project, capable of delivering some cream - but important in the longer term.

I've mentioned in the past about GoHealthy and the multiple of what that gets sold at through Private Equity, and the multiples of what Ziwi got sold at. Big investors don't get so excited by factories, but they get excited by brands.....

Anyway, as an example, Lorraina's 60 pack of 750mg 04+05 capsules is about 45g of powder. Even at the discounted price it means they are selling the powder for effectively $655/Kg - they take the ingredient and manufacturers margins and in this case the retail margin. So while it might be cheap, it is still bloody good for AiOra. The closer to the consumer, the bigger the margins.....

Think of the beef liver capsules - what do you pay for beef liver down at the butchers (relatively not much - if they even have it). 120 capsules, 500mg at $31.60 on subscription = $526/Kg for beef liver powder.

There is some tasty margins in there......although you have to sell alot of capsules.....

Undoubtedly it is a difficult road building a brand, but hoping that they have some success, even on a smaller scale. Best of luck to Pharmazen on it.