Amarin Corp Plc (AMRN)

[Jeffkad]

Couldbebetter, yup, well aware of the various formulas to determine value, whether NPV, DCF, etc. In this instance, just keeping it simplistic, but based on NVS own revenue estimates, the MDCO BO is a good deal at 16%, or even 30% of total revenue. Of course, there is no way to know whether their estimates will ever come true, or if they themselves believe them or they just published them as a PR move to make the deal look better and make shareholders feel better ??. Getting back to AMRN, no doubt they are completely de-risked after approval (assuming positive generics suit outcome), and given their high margins, which will be even higher for a BP with established, no cost sales force, it’s all about total revenue. BP will have roughly 9-9.5 yrs runway if a quick BO is accomplished, and hopefully formularies will adjust by mid year to reflect new label. Having said all that, I don’t think it’s overly simplistic to assume that even if V can do $30-40B over this period, who’s paying more than 50% of that to acquire them? (And that’s 50% before NPV, DCF or any other net value-reducing formula). The short runway makes me stick with the 15B-20B BO.

BTW, if they go GIA, while revs increase, multiples will decrease as the runway for their only product diminishes, so holding beyond a year or two without a BO will require a recalculation. If, and hopefully this isn’t the case, JT thinks he’s building his own BP and starts buying new molecules, watch out lol.