It is interesting that VRTX has not announced this. Neither is a word about it at VRTX web site.
Of course what else could we expect from Leiden? He only announces news about CF and the hell with any thing else VRTX scientists develop!
Below is part of the news about Editas.
Editas, if successful, would be developing a method of fixing the actual gene responsible for the disease rather than a daily pill which counteracts that gene, like Vertex offers.
The results of phase 3 661 and phase 2 787 for influenza should become available in may 2016. I wonder when they will make an announcement of the results.
Also phase 1 results for 970 should be available this September.
Error: Instead of " i did not include royalty streams because..." I meant to say "I did not include milestone payments because...."
MY calculations are about recurring annual royalty streams. All milestone payments are on top of athe royalty streams. i did not include royalty streams because they are not not recurring every year.
Movantik sales $110 M. Royalty rate of 20%+ in US, 18%+ in ex-US
Adynovate Royalty rate is mid single digit (5%?)on up to $1.2 B sales and low teens (11 to 12 %?) on over $1.2B
Cipro sales $750 M. Royalty rate 10%
Amikacin Inhale sales $700 M. Royalty rate 30% in US, 22% ex-US
A rough estimate of the above royalties:
Movantik-- $110 M x 20% = $22 M
Adynovate-- $1.2B x 5% = $60 M
Cipro-- $750 M x 10% = $75 M
Amikacin-- $700 M x 30% = $210 M
The above 4 royalties alone if I am correct total annual royalties of $367 M which means, as HR said in the conference call, before too long we will become cash flow positive.
I think I am going to load up more shares by stealing them from shorts.
I stand corrected if my figures are wrong.
The federal corporate tax rate is 35% and the average state tax rate is 4.2% for a total tax rate of 39.2%.
So at the 39.2% tax rate, NKTR's tax loss carry forward is worth $745M. A buyout of let's say $3B reduced by this amount means a buyer is paying only $2.25 B for the company.
As far as company's liabilities, they are less than its assets on its balance sheet as of Dec 31, 2015.
NKTR market cap today is $1.9 B. It also has loss carry forward of $1.9 B+ in its balance sheet which would offset earnings of a big pharma company's taxes. On top of that a buyer will get all the royalty and the pipeline.
Even if the purchase price is at a 50% premium to today's pps, the buyer will be stealing a great asset for peanuts. With NKTR pps having been so low for the past several years, for the life of me, I do not understand why this company has not been taken over. Am I missing something?
"BRIEF-Vertex Pharmaceuticals files for potential mixed shelf
— 5:48 PM ET 05/03/2016
May 3 (Reuters) - Vertex Pharmaceuticals Inc
* Files for potential mixed shelf; size not disclosed - SEC filing Source text for Eikon: Further company coverage: (Bengaluru Newsroom: +1-646-223-8780)"
Apparently investors do not think that is a positive development.