Innovation Pharmaceuticals Inc (IPIX)

[PlentyParanoid]

I have to agree, it is rare to see premium over 200 %. One caveat: often there has been a run up on the SP before the buyout announcement.

However, it seems to me that everybody is thinking that the choices are either partnering or buyout. Folks, there is a third option, which might be the best option for IPIX (if they can make it happen) - sell one product line for a cash payment and use the money to develop the remaining two. At right price probably the best way to increase market cap.

Some people who were in much better position to know what they were talking than I ever was mentioned to me this quick drug pricing estimate ie. how high big pharma might be willing to go:

Price cap for a drug with FDA approval or perceived high potential for approval: about 2 to 3 (I have never heard of higher multiplier than 3) times the expected peak yearly sales. Drugs not yet on the above near risk free stage will have a risk dependent discount factor on cash value payment or heavy reliance on payments based on commercialization milestones and royalties.

So, if IPIX manages to sell or partner something most of the money is likely to be tied on milestones and royalties. And my idea of selling a product line for cash is probably a pipe dream.