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