OncoSec Medical stock is just the most recent victim of Chinese business practices that violate WTO rules.
OncoSec wants to sell its TAVO product in China. In order to do that, OncoSec must give up 53% ownership of the company to the Chinese firm CGP and its affiliate Sirtex Medical. Furthermore, OncoSec will grant Grand Decade and its affiliates an exclusive license to develop, manufacture, commercialize, or otherwise exploit OncoSec’s current and future products, including TAVO™ and OncoSec’s new Visceral Lesion Applicator (VLA), in Greater China and 35 other Asian countries. Grand Decade will pay up to 20% royalties on the net sales of such products in the Territory. But it gets even worse.
Should CGP seek to offer to acquire the remaining shares of OncoSec within the 12 months following the closing of the transaction, the offer price for the outstanding shares of OncoSec must be the greater of $4.50 per share or 110% of the last closing stock price of the common stock on the date prior to making an offer to acquire the remaining outstanding shares of common stock.
Finally, in addition to the 20% royalties on all China and 35 other Asian countries, Sirtex will support and assist OncoSec with pre-marketing activities for TAVO and VLA in exchange for low single-digit royalties on TAVO and VLA net sales OUTSIDE the Territory.
Here is how the company CEO is pitching this to investors: “CGP is a global pharmaceutical company that has significant interests and holdings in the immuno-oncology space with the expertise and infrastructure to broadly introduce TAVO within these important Greater China markets where there remains a significant unmet need in a variety of cancers, while also providing support to our development activities elsewhere. We look forward to a long and fruitful partnership with them.”
This is a forced technology transfer by China against a tiny US listed microcap stock and this sort of technology transfer goes on week after week with thousands of US companies.
Communists must own the means of production because that’s the very definition of communism. That means in order to do business in China, you must transfer your technology, and in this case the entire control of your company to the Chinese. You must even let them outright buy your entire company if that’s what they want.
Here is the complex financial structure of what the Chinese have setup. Notice they even call the parent company “Outwit Investments Limited”, again showing their predatory practices and desire to outwit everyone else and be number one at the expense of everyone else instead of being a good global player.
Outwit Investments Limited, a company incorporated in the British Virgin Islands with limited liability, has an ownership of 40% by Mr. Hu and 60% by Grand Investment.
Grand Investment is a company incorporated in Hong Kong with limited liability which is wholly owned by China Grand, which in turn is controlled and ultimately and beneficially owned by Mr Hu.
Mr. Hu was China’s Communist Party chief for five years and state president for four. Mr. Hu was Party Committee Secretary for Guizhou province and the Tibet Autonomous Region and we all know the slaughter and what happened in Tibet. Hu is a hard-core communist who “reintroduced state control in some sectors of the economy” that were relaxed by previous communist administrations. In other words Mr. Hu was involved in cracking down on free markets, seizing wealth, and putting entire sectors back under strict communist government control.
I have sent a complaint to the White House via email and also a post to President Trump and his son on Twitter. My guess is that nothing will come of my complaint because I’m not a shareholder in ONCS and ONCS is a microcap company that’s below the radar.
This is not fair business practices by the Chinese and is strictly forbidden when China was accepted into the WTO. The fact that ONCS has to transfer the control of its company over to the Chinese in order to do business inside China is wrong on so many levels. While what is happening with ONCS is a tiny little cut, when China does this to thousands of US companies, it has the ultimate impact of bleeding our country dry: death by a thousand little cuts.
Think Comcast’s NBC, or Disney’s ABC, or Turner’s CNN, or National Amusements CBS will report on this? Not a chance. Look at what happened in the NBA when China was criticized because the shoe corporations want to do business in China. These corporations all want to do business in China and so they block these stories from ever being reported to the American people. This is exactly how our entire manufacturing sector was gutted and outsourced to China since 2001 when China was accepted into the WTO.
Will ONCS shareholders do the right thing for America and vote down this Chinese takeover of their company? No. They just want to make money too and that’s how China uses our democracy and free markets against us to slowly bleed our country dry.
Please share this article with your family and friends so that they learn more about what’s going on and can stay informed. The future of our country is at stake and we only have the internet and sharing of articles like this because the mainstream media has turned their backs on us in the pursuit of greed.
Disclosure: I proudly do NOT hold any position in ONCS stock.