Biotech Values

[DewDiligence]

Re: RVNC’s valuation (updated)

…do you still think it’s significantly undervalued at current level?

RVNC is a solid buy for long-term investors, IMO. Based on the phase-3 results from the SAKURA-1 and SAKURA-2 studies reported in Dec 2017 (#msg-136643306, #msg-136644001), RVNC is almost assured to launch a best-in-class product in a fast-growing market within the next 18 months.

Moreover, the addressable market is truly global. As emerging middle classes in formerly poor countries gain more disposable income, one of the things they want to spend it on is looking good.

As I’m typing this (share price=$24.88), RVNC’s enterprise value on a fully-diluted basis is only $835M (#msg-144654960).

The current worldwide market (aesthetic + therapeutic) for botulinum toxins is about $5B, and this market is expected to reach $10B in 2023, if not sooner. I previously estimated that AGN’s Botox franchise (including aesthetic and therapeutic indications) had a net present value of $24B (#msg-127654469) and, based on the passage of time, that figure is already too low. Plainly, there is ample headroom for RVNC at the current valuation.