The fourfold increase in valuation is significant. Hopefully the January 31, 2017 financial statements of both Zenith and RVX will confirm the increase in valuation. Last years financials for the first quarter ended 1/31/16 were released on SEDAR for RVX and Zenith on 3/14/16 and 3/23/16, respectively so we could expect to see the reports released in the next 30 days. 

Another possibility is that Zenith will recognize a portion of the Royalty preferred share receivable from RVX. The last paragraph in the Note 5 disclosure re: Royalty preferred shares in the Zenith October 31, 2016 states:

          The Royalty Preferred Shares have not been recognized. The Company will recognize a royalty receivable when                            royalties are reasonably determinable and the economic benefits are probable to flow to the Company. 

Note 6 of the Resverlogic October 31, 2016 financial statements(p 10) valued the Royalty Preferred Share Liability at $39MM.

"The estimate incorporates the following assumptions: a cumulative probability rate of generating forecasted future cash flows of 35% as at October 31, 2016, reflecting in each case, among other factors, the Company's clinical results and communication with regulatory bodies. A discount rate of 23.3% as at October 31, 2016; commencement of revenue beginning between 2021 and 2023; apabetalone market share percentages; and product pricing." 

The last paragraph of Note 6 reads:

"The fair value of the royalty preferred shares is subject to significant volatility. Small changes in the aforementioned assumptions may have a significant impact on the fair value of the Royalty Preferred Shares. Holding all other assumptions constant, a 1% increase in the discount ratewould result in a 3.6 million decrease in the fair value of the Royalty Preferred Shares. Assuming commencement one year later would result in an $9.4 million decrease in the fair value of the Royalty Preferred Shares."

This valuation increase to $500MM sends a strong message. Sometning big is going on. Indications are that BET inhibitors really do work, are safe, relatively inexpensive, and gaining recognition and acceptance in the scientific community.

Also note that the calculations noted above were based on Net Apo revenue. After the October 31, 2016 financials were published, the Royalty preferred shares agreement was changed to provide that the holder of Royalty Preferred Shares is entitled to a dividend calculated based on a percentage of net revenue earned from the sale or licensing of any pharmaceutical product in which Resverlogic holds an intellectual property right.

IMHO this is a huge development - I am anxious to see how this translates to RVX market value. The probability % reflects the Company's clinical results and communications with regulatory bodies.................... read between the lines.......... multiple indications, FDA approval, orphan indications  

DYODD

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