Depending on their bottom line Phase 3 results, the ability to not only shrink and remove tumors without surgery but imbue a memory that prevents the tumor from coming back, it's quite possible we could see NWBO hitting price targets unimaginable. It is all quite possible. GL
Sentiment: Strong Buy
Impossible. Last years manufacturing agreement will prevent that. Half of Cognates costs to NWBO is locked in at 4.00 per share and cannot change unless they agree to the change and why would they. Let's say if the cost to manufacture per patient is 50,000.00 and the amount NWBO receives per patient is 120,000.00 over 3 years. Half of that 50,000.00 is 25,000.00 in stock at 4.00 per share. That equals 6,250 shares Cognate will receive times 300.00 per share bring the cost to treat at 1,875,000.00 per patient. NWBO will have to continually dilute to stay in business, resulting cap on the stock price. Ask yourself why Linda set it up this way. She owns part of Cognate if my memory serves me correct.
You are a little confused posiedon. You are confusing DCVax-L and DCVax-Direct. We are awaiting the first interim review(board) recommendation for L, not Direct. And it is Direct that reportedly showed "the ability to not only shrink and remove tumors without surgery but imbue a memory that prevents the tumor from coming back" in animal studies. Direct is in phase 1. That said, I have heard people that sounded credible talking about $300 valuations for NWBO down the road. I don't remember if they were talking about DCVax-L expanding from brain (the current application in phase 3) out to other cancers, or if they were talking about DCVax-Direct. I think it was probably Direct, which is currently unproven in humans. I hope it works in humans, and I even think it will work in humans, but they have no evidence of that yet according to Linda Powers, the CEO for Northwest.
Actually, you're confused, modajon. Both treatments result in an immune response against the tumor in question, resulting in a reduction in recurrence. Direct is generally cited as being able to shrink tumors because it is used in cases where the tumor can't be removed surgically.
In my opinion.. trying to do math to justify the future value will be wrought with huge estimation error. Simply look at market comps -- companies like ICPT and ONXX .. you end up with value somewhere between $5B and $10B market cap ... so north of $90 per share on the low end and double that on the high.
If the DCVax-L is stopped for efficacy - i think we are $5B valuation at the open and the shorts and in a world of hurt.
Many things have to occur before peak sales but, if we want to day dream, some quick back of the napkin sums lead DCVax to a conservative $121.5B in annual gross profit.
Workings below, if anyone is interested. Feel free to challenge:
IF both Direct and L are approved we transition from a speculative stock to an earning one, rapidly. (Unmet need, fast track/breakthrough therapy designation - let's say a steady rollout of all indications starting 2016). If not licensed, partnering would be required for many of the indications due to the scale of the job but some (GBM) could potentially be taken to market by NWBO solo. None the less, lets assume a blanket partnering deal of 50% (open to input on the split).
The market for ALL solid cancers is massive. Since DCVax is a new category of drug, we can't use current market size (current revenue) but instead need to think about patient numbers.
Total annual cancer diagnoses as of 2012 were 14.1M, minus ~600,000 leukemia and lymphoma = 13.5 million.
Les Goldman indicated treatment costs would be around $40k per year, over 3 years for GBM. We could reasonably assume similar pricing for other indications (For the sake of the simplicity, we'll use the total of $120k per annum due to new/existing patient overlap).
At peak sales, it's estimated that COGS would be around 25% (much lower than Provenge due to the batch manufacturing process and cryopreservation). This gives us a per patient profit of $90,000. Split with partner gives NWBO $45k
To be conservative, let's assume that the DCVax platform only captures 20% of potential market, so 2.7M
multiplied by $45k is $121.5B. That's annual gross profit. Not bad.
You can work out your own EPS (remember to include estimated future issuances).
Just a bit of fun, but nice to think "what if" now and then.
OMG. I always cringe when I see these silly projections all thought out with margins and market share. It's really not even "just a bit of fun" unless telling "Jack and the Beanstalk" and believing it is your idea of fun. As a point of reference, the largest selling cancer drug in the world is Rituxin. at about 3B. Your credibility is shot.
That would mean anywhere between $500B and $1trillion in market cap, or $ 12,500- $25,000 pps with current share count.... basically a lottery ticket.... but with better chances of success than a lottery ticket, though!
Actually, just an amendment to this. The COGS of Direct will probably be higher than L, due to L's outpatient administration and Direct's (presumably) image guided administration. But even if it brings COGS to 50% the potential is still mind boggling.
I would temper inflated expectations or wishes. We have to cover some serious ground prior to those numbers. I'm extremely optimistic that NWBO will pay off in the long run, but to say $300 is abit careless and misleading. If this stock hits, I can walk away from what I'm currently doing in life. I would love that. However, it's a bit of a pipe dream to think it will happen to that extent. Having said that, if this stock pans out and does what we hope it does to tumors, it becomes extremely difficult to get a proper valuation because this cure would be in unchartered territory.
Very correct. The science that NWBO is beginning to understand is so revolutionary that it is uncharted territory. I suspect that with good phase III results, this company is small enough that some big pharma might offer to buy it up prior to FDA. Approval which is very unusual. The reason I say this is because the give to get with NWBO is so significant. If they are really extending life as long as expected then this company will not exist in one year as it will have been purchased.
This is an all or nothing play. If the results in the interim are good, then the stock rockets. Big Pharma will get into the game to try to buy on the cheap at say $20 or $30. We will see relatively shortly. If results are mixed or worse, the stock tanks below a buck.
I don't think Linda would sell below $50 if interim results are promising but will sell if the price is right. JMHO
i dont want to be negative, but we should stay on ground. its a long way to go. and nwbo has a history. its not like icpt which had no stock history. Of course i hope we could see 50 or 60, but we should have an eye on the results first. step by step.
Since NWBO has double the amount of shares than ICPT and in regards to MC, NWBO will be worth $160/sh. "BUT WAIT, THERE'S MORE LOL" Everyone is forgetting about EU and UK and all the other countries NWBO is involved with. Plus dcvax Direct which patients can now receive treatment for inoperable tumors and has no competition. $320 looks very possible now- don't it!
Well, using ICPT valuation as a sample guide, if ICPT @ $326 for 19m shares outstanding; then NWBO is at least $160 for 39m shares outstanding. Not chump change at all..Good luck long!!
Sentiment: Strong Buy
I'll take $160 any day although that figure can be easily surpassed if DC-Vax lives up to expectations. And let's not forget that ICPT's drug was in a niche market, at least relative to cancer. The market for DC-Vax L and Direct is slightly broader. We're definitely on the horizon of something huge here. GLTA
Sentiment: Strong Buy