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Aegerion Pharmaceuticals, Inc. (AEGR) Message Board

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  • corwin_71 corwin_71 Oct 17, 2012 9:23 AM Flag

    Approval equates to $1.8B or $72/share = $701.60/share value

    Man, I wish you were correct . . . . however . . .

    Patient population, based on recommended REMS, may only be 3,000 to 4,000 per annum, and not all will use the treatment. If we go conservative and use 2,000 patients, then use $300K per year for the treatment, you're looking at $600M in annual revenue, which is a bit higher than most estimates of $450M. At $600M, the margin, (as there is a cost associated with the treatment), will likely be in the area of 75%, or $450M in gross profit. SG&A will increase from current levels, likely to $125M, thus leaving $325M in taxable income. Even after taxes and interest, net earnings would be at least $200M. At a multiple of even 5x earnings, the market cap would be $1B. Today it sits at $470M.

    The point being, even using conservative esimates, there is a double here.

    ISIS has $100M in annual revenue today, plus a developing pipeline, non of which is remotely close to even having Phase 3 trials, yet it sat at $1.3B in market cap prior to yesterday's 22% decline. Add to this that they only receive 30% of the potential revenue from Kynamro (Sanofi gets the rest), and the estimates were only $180M per year for them. Add the $180M from Kynamro to the current $100M in revenue and you get $280M per annum for a company with a market cap of $1.3B. I don't care what investors say, that's a lot of market cap for such a small amount of revenue and an unproven development pipeline, but welcome to the wonderful world of biotech investing.

    No matter what you cut it, AEGR has MAJOR upside from the current level and could easily be priced for a market cap of well over $1B.

    Sentiment: Strong Buy

2.75+0.10(+3.77%)Sep 23 4:00 PMEDT