A company valued at $1B by the markets that: A)hasn't turned a profit B)Won't turn a profit any time soon C)Has ONE drug candidate with an ULTRA-RARE indication D) Analysts estimate $8MM in revenue in 2013
I don't understand. GEVA is valued at roughly 125x forward revenue. There is market potential of less than 8,000 patients, most of whom are being treated with existing drugs and are no worse for wear. 9 times out of 10, LAL is misdiagnosed. The patient population doesn't even know they're a population! Even a 25x valuation on this company would be generous. A fair valuation? $250MM tops.
Please, someone explain the $48 share price and $1B market cap. I'm desperate for answers.
As the other poster stated, ask Baker Bros who, by the way, own a huge position in Viropharma, a company with a somewhat better pipeline than GEVA but largely dependent on Cinryze. Cinryze is an ultra-orphan drug that brings in over $350,000 per patient per year. Ultra orphan drugs are hugely lucrative.