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Dare we Dream?

lse:fum

#1

Whilst researching potential valuations I came across the name “Joseph Edelman”, portfolio manager at Perceptive Advisors and apparently widely regarded as the greatest biotech investor of all time.
So he typically places a 3 x peak sales multiple on potential drug candidates although in some cases he has applied multiples of 6x or more.

So I know and we all know MEDs projected peak sales amount to a billion dollars. If we assume 500 million dollars for now and just use a multiple of 3, this means if it’s sold off it should command 1.5 billion dollars .
If we discount this further by only assuming a multiple of 2, we get a billion dollars.

Surely not???Dare we dream??


#2

It’s great to dream. I can see Barder at the negotiating table, like Dr Evil, demanding “one million dollars” , as GSK, Bayer etc fall about hysterically…


#3

That would mean there was an initial valuation of 650 million on the table during negotiations, as Barder said the derisking after phase 3 would increase the value with 50%… I think they would have taken the deal immediately even @250-400 million!
My biggest fear, even with a decent outcome after ph 3 is that no big pharmaco will pay top dollar…I am guessing a valuation of 400 million dollar in total or $2 dollar per share after excellent ph 3 trials. But we will found out very soon…hopefully big Pharma Co’s are involved and not just small players that will just pay small upfront and bigger royalties but don’t have a big marketing machine to develop the widespread sale of the gel.

A bit disappointed by the current TPR update and progress…we need this news to go towards the Liberum’s first 60p target price, before the readout of phase 3 trials.


#4

#5

Futura Medical doesn’t have the means to produce a product and market a product by itself. So I’ve used the projected figures and assumed a 20 percent royalty rate based on phase 3 data being available. I arrive at a price between £1.80 to £3.60 per share for MED that would be attributable to FUM.
But what do I know. Could be anything to be honest!!


#6

I know it really could be anything, I never think it’s worth trying to guess to be honest.

We’ve got to remember anything could happen between now and December. Have to say it is a shame about the TPR delay but I mean it’s all going to come down to the end of the year anyway.

In the last RNS they stated ‘we continue discussions with a number of interested commercial partners for the out-licensing of MED2005.’

I’m sure if they got the right offer they’d take it but saying that if they’re confident about positive phase 3 results (which I think they are), they’re better holding out.

Hopefully the SP will hold out strong the rest of this week, we’ll have to wait and see.