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Vertex Pharmaceuticals Incorporated Message Board

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  • swhitemd50 swhitemd50 May 7, 2012 9:45 PM Flag

    Okay let's look at this logically.

    I'll take this one. It's easy. Let's say the new combo drug regimen, Kalydeco/VX-809, can only successfully treat 50% 0f CF patients and let's use 70,000 for the number of CF patients in developed countries with the money to pay for the new medicines. So now we have 35,000 treatable patients. Now, say that only 20,000 of those patients actually are able to get treated and let's discount the price from the estimated $300,000 per patient per year to $200,000 per patient per year. Here's the math: 20,000 patients X $200,000 per patient per year = $4 billion each and every year!

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    • Not every year. It cures them in 12 weeks.

      Stop with the every year nonsense.

      • 2 Replies to stockmantykus
      • I think you are getting the new hepatitis C treatments confused with the new CF drugs from Vertex. Yes, you can cure hepatits C sometimes in just 12 weeks but not cystic fibrosis. These new CF meds will need to be taken for the rest of the patient's lives to remain effective.

      • Swhite is right on this one. There's no cure in this market. These patients will be paying (for the sake of argument) $200k/year for the rest of their lives. $4 billion a year is pretty conservative-- remember, Kalydeco has had incredibly fast uptake at almost $300k/year.

        And this is a small molecule in a small market, so cost of goods and marketing costs will be very low. Profits on the CF franchise will probably approach 90%, let's say $3.5 billion/year. Put a 10X multiple on that and you're at $167/share.

        You might get out of your short intact. That was a pretty big gap up today, and Europe could always take the market down, but you're unlikely to make a profit that's worth your time. And I do think there's a significant risk of your short going very wrong. There's potentially transformational HepC news coming in the next month or so.

 
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