Tom Schreier, from US Bancorp Piper Jaffray,
during Word on the Street, discussed ALKS today. He
likes biotechs better than pharmaceuticals. A summary
of his comments and a link to more information is on
the CNBC Specials page. Follow the
I've had this stock from when it was 1 1/2 and
purchased at various points up to 22 when I sold. I think
we will see 40 short term and I will make a decision
at that point. Good luck with your quest for
A lot of biotechs are ripping it up. Maybe some
internet guys moving in? Immunex, Genentech etc, all doing
very well. I can't explain the volume though in any
other terms than those which you mention. Up strong
today on (relatively) small volume. Technical chart
guys who have looked at the stock think indicators are
good for a run to 40.
I have finally made
enough gain in the stock from exercising my $5.00
warrants to break even on my Cereport partnership
investment a long, long time ago. It would be nice to have
my patience rewarded with some profits. I'm not
greedy. I look forward to seeing how we do short term. Do
you have a stop in place?
ICOS "is actively seeking to buy or partner with
development companies to keep its product
pipeline filled with promising new drugs". ALKS doesn't
have products as such - it is drug delivery. SO I do
not see this as a fit
Its impossible to accurately assess a company
But since you asked, my opinions are:
hgh sales will be much higher. EPO and risperdal much
lower but both should get to market sooner than your
Take low double digit royalty as you suggested I
arrived at the following:-
(1) rhGH, assume 12% of 200
millions =24 millions, NDA just filed and may have to wait
a year thsu discount 25% = 18 millions (1999 value)
(2) Risperdal, assume 12% of $2 billions =240
millions. Phase 3 just started and may takle up to 4 years
.let say 3, and then 1 year for NDA. IT may then be
marketed in 4 years. Discount 30% a year = 84 millions in
(3) EPO, assume 12% of 2000 millions =240 millions.
Assume it will take7 years to get it to market. Discount
30% = 38 millions
Just these three together
gives a subtotal = $140 millions 1999 value. Current
Rand D and administration Expenses from the 10K is $63
millions. This yield a net = $77 millions
about 25 million shares outstanding (40 millions
Thus we arrive at a total of $3 a share ESP.
PE of 27 = Present value = 81,
Since no one pays
full price, I discount it by 25% (comapre with other
biotech I know of).The present value of ALKS , without
considering any other Phase 1, 2 trial drugs is $61 today.
How much am I off ?
They get mfg revenues/royalties which equate to
low double digits according to analysts.
how about seeing what idph, bgen, imnx and medi are
at? Young, fast growing biotechs can carry far higher
PE's than big pharma.
Does anyone know what is the royality rate for
rhGH, Risperdal, and EPO ? I read through the 10K real
fast but cannot find such information.
I am trying
to guess what this puppy is worth by assigning a 5%
rate (sort of industrial standard), using 25 million
shares outstanding, a PE ratio of 27 (for big pharms
these days) and a discount rate of 30% per year push
out. Are these assumptions valid ?