I don't think Monovisc will have a material affect on revenues. The reality is that docs like the three shot regimen because they make more money at it. But the FDA delay of two years in approving Monovisc bordered on criminal. I could swear there are times I think the FDA is in bed with Genzyme, which had SynVisc. I think the biggest money maker for ANIK will be Cingal, once it is approved.
I'm long and I agree with you that there's a lot of support in the 30-31 range. 6.3 million shares changed hands today, so buyers are stepping in. The stock in my view is worth $50-$60. People are really discounting two things about Esbriet: a) the last trial which was a resounding success, and b) the traction that Esbriet is gaining in the EU and Canada. This is from the CEO during the Q3 1013 conf call: "Esbriet is already listed as the standard of care in country level treatment guidelines for IPF in seven countries in Europe." Standard of Care. That's music to my ears. And it will be listed as standard of care in the US as well. They are projecting $135 million in revs for 2014 in the EU, but I predict they will hit $160 million. And that will double in the first 12 months of the US launch, hopefully by late 2014.
Shorts will be scrambling to cover now and AH. This isn't just about peak sales (although, upon further research, one can see there are about 500,000 people in the world with PF, and 50K new cases a year in the US alone - so this is easily a $2-3 billion drug), the price action is about an expected buyout. Everyone was waiting to see if this forced phase 3 trial (FDA required this trial before confirmation) would hold up on results. And it did, in spades. Now that they are in the clear, the buyout discussions start in earnest.
Sentiment: Strong Buy
Be as bold as you want. You are one of the 13%ers - i.e. the shorts. We are about to see a short squeeze that will take this over $40. That's my bold prediction.
I think ABBV's share will be more like 2-3 billion, not 5. Using your calculation at 3 billion we are talking $180 million in royalties, but that is still terrific. I still believe that ABBV will buy ENTA after approval. That way they pick up ENTA's MRSA antibiotic, the Novartis collaboration, and other drugs in development.
Sentiment: Strong Buy
"The other analysts that have the target closer to 450 are more accurate right now IMHO." Sorry, I meant closer to $50, not 450.
you get to $80 faster than I do, but your scenario is just as plausible as mine. NPSP has been a core holding of mine for two years, and will continue to be!
I'm on StreetSmart Pro and it is showing Needham upgrade to $46, Wedbush upgrade to $47. I can't link to their pages. Other upgrades are coming. I would not be at all surprised to see Deutche or some other analyst come out with a $55 price. NPSP deserves that valuation!
oh and besides this "hold" call, the other reason for a mild sell off is from the MoMo players that bought into earnings and are now getting out. PCYC did the same thing. Down $5 after earnings, then up.
Jefferies, whose calls I normally respect, believes that 2014 Gattex sales and Natpara expectations are priced in already. They have a target of $38. I couldn't disagree more. My estimates for Gattex/Revestive are $160 million in 2014, $375 million in 2015, and royalties of $150 million/$200 million. Plus $5 million in 2014 for Natpara, and $150 million in 2015. That's total revenue of $315 for 2014, and $725 mill in 2015. With so much upside left after 2015, (worldwide sales for Gattex/Natpara should reach $2-3 billion), I think NPSP will be trading at least at 12X-15X revenues by YE 2015, or at $85-$107 per share. (Look at Alexion trading at 17X revenues!) Another way to look at it is that by YE 2015 NPSP should be making north of $2-$2.50 per share, and if you give that at 40-50X multiple for growth, you get to the same place. The added bonus is that the likelihood that a large player will buy out NPSP between now and YE 2015 is at least 50%, so that return of $47-$70 could happen a lot sooner. The other analysts that have the target closer to 450 are more accurate right now IMHO.
Sentiment: Strong Buy
This stock has a distinct trading pattern that suggests there are some larger players manipulating the bid on the stock every day. It almost always starts well, then drops precipitously ($2-7), and then recovers most if not all. Often it will go negative a couple bucks and then end positive. I think there are some hedgies who are manipulating it to pick up more shares in the trough every day. I expect this to close even or perhaps down a buck. I could be wrong of course.
Seriously? As if anyone holding this stock is doing so for today's earnings report? This $2 sell-off has to be retail day traders playing the run-ups. Obviously ENTA is about what's coming around the corner- the submission for approval by ABBV, and then the approval itself. ENTA goes to $50
$100 mill in cash. No debt. ABBV is on the line to pay ENTA around $200 mill. Then ENTA will earn $100-$300 mill per year on their royalties from ABT-450. The billion dollars will be paid back in less than 5 years, and will be cash flow positive for ABBV in the first year (cost of money to buy ENTA will be around $80 million per year). Plus, ABBV picks up Enanta's Bicyclolides program with a potential MRSA blockbuster drug, a partnership with Novartis from ENTA's other HCV drug, and a couple of other promising compounds in ENTA's preclinical pipeline. OK, mayber $1.5 billion. That's $83 a share. I'm ok with that.
mossa, I agree with your scenario as much as mine. either way - buyout or growing into a full-scale specialty company - we are in a good place right now. Also, if EDP-788 shows signs of live, that drug alone will add $300-$500 mill in valuation. MRSA is the most prevalent life-threatening bacterium in a hospital and nursing home setting, and there is a dire need for a more effective antibiotic. I agree that ENTA will be in a terrific position to buy either a phase 2 or a phase 3 compound that shows great promise.