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Elan Corporation, plc Message Board

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  • simonig simonig Jan 31, 2003 1:54 PM Flag

    Transcript from Bloomberg Interview PT1

    ELN valuation could be $30 billion with Antegren and two Alzheimers drugs in the pipeline. The three most important things for a high valuation to a drug company with lots of cash is Pipeline, Pipeline, and Pipeline. Let's not forget that Elan has lots of cash and is raising more CASH.

    Best Regards,

    Simon

    PS: How about that Pipeline with Antegren, Two Alzheimers drugs, Frova, Prialt, plus many JVs.

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    • >>ELN valuation could be $30 billion with Antegren and two Alzheimers drugs in the pipeline.<<

      Much as I wish this were true, this is pure bunk. To achieve $30B valuation, Elan will need to have $3B in sales and have a strong pipeline.

      >>Let's not forget that Elan has lots of cash and is raising more CASH.<<

      Let's not forget that this cash is more than already spoken for: $800MM in LYONs can be put at end of year and $840MM in EPIL II and III debt is due next year and the year after. Plus, add in $250MM in annual operating losses over the next 2 years...

      CASH: $1400MM

      DEBT: EPIL II & III - $840MM
      LYONS - $800MM

      OPERATING LOSS EST.: $250MM

      I hope that operating losses are offset by increased Frova sales, and myobloc sales and by Prialt and Antegren sales (assuming approval). But who is going to sell these products now?...

      • 2 Replies to Splaylaywahtheepi
      • thorn_in_the_side_of_datek_crook thorn_in_the_side_of_datek_crook Jan 31, 2003 2:29 PM Flag

        Bottom line is that this company has been, and I see no reason for a change, losing aproximately 440 thousand dollars per employee.
        Armen says they will generate 500 to 800 million in sales. that's not very impressive to me.

      • Hello Splaylaywahtheepi,
        Maybe you are right about Elan not being worth $30 billion at this time and that my thinking is "bunk". However, note that Elan was down to $1.13 per share just a few months ago based on the "wrong" type of thinking. My belief is that Elan will recover to the mid teens this year. When the price reaches the mid teens, I believe it is likely for them to get an offer to get bought in the mid 20s. I do not believe they will get buy-out offers before the SEC investigation is completed and before the stock reaches the mid teens. If they get past this year (without a buyout) and get FDA approval for Antegren, They should be able to reach the $3 billion revenue target and still have a strong pipeline. IMHO, it is the strong pipeline which makes Elan a strong buyout target.

        Best Regards,

        Simon

 

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