Biotech Values

[linhdtu]

Dew, I did a hard DCF eval of enta using some of your numbers.

I took your peak royalty payment of 127M$ which I assign to yr 2016.
I assume this stream of payment declines by 15% a yr until 2024 due to competition.
I assume a discount rate of 10% which I thought is middle of the road. I would have used a much higher rate of 20-25 or even higher for non approved drugs in cancer.And finally for 2015 I assume a royalty payment of 80M$.
The PV of these 10yrs is 535M$ + 277$(your cash number) + 100M$(your Japan number) = 921M$/20Msh = 46$/sh.
So it is a matter how low I can buy back in and I will.
I would readily admit I get my assumptions from the parts of my anatomy normally protected from sunlight. And I don't go past 10 yrs as the discount factor gets bigger and the payment stream gets smaller.