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Lpath Inc. Message Board

  • left_e_investing left_e_investing Nov 4, 2013 3:20 PM Flag

    Condition "Irrational Exuberance"... a series

    Yes, Bristol Myers Squibb indeed paid $325 million for Amira and offered an additional $150 million in milestones. That’s nearly a half a billion $$ for a company that not only had no sales and no profits, but their lead product had just completed ph 1 safety testing. Not even a ph 2 trial to take a good look at efficacy. Irrational exuberance on BMY’s part ?
    And here’s Lpath with 2 products well along in ph 2 testing, that has products 3 and 4 in the pipeline for which there’s theoretical evidence they may work better than Amira’s small molecule(s), that has a technology platform to generate additional new mAbs, and that has lots of foundational patents. BMY could even end up stepping on some of those patents. Like these for instance: 18.6,380,177 LPA Analogs as Agonists of the EDG2 LPA Receptor, or 19.6,248,553 Enzyme Method for Detecting Lysophospholipids and Phospholipids.
    Yet the market says Lpath is today worth maybe 1/8 the value of Amira.
    So, how can we get to the value of a biotech during its developmental stage ? The market gives its best estimate as to the net present value of future cash flows from products in the pipeline. And the market always gets to the truth. The question is, can we get there any faster ? If anyone wants to understand the truth about new medicines (and this investment, for example) it’s important to understand a bit about clinical trials. Nexus is phase 2, is looking at both safety and efficacy, and represents the company‘s first double-blinded trial. If I see some thumbs up (or down) I’ll share some thoughts on what we might learn from it, and why Charles and I think the market could be off by a decimal point or two... or more...

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