Biotech Values

[DewDiligence]

Re: JNJ buyout of MNT

>Mentor is developing the anti-wrinkle injection PurTox, which would compete with Irvine, Calif.-based Allergan's Botox.<

This is somewhat misleading insofar as PurTox is being developed for both cosmetic and medical applications. 50% of worldwide Botox sales come from non-cosmetic indications.

PurTox is the main driver of the JNJ buyout, IMO, although I expect the reports in the business press to miss this point because PurTox is not yet on the market. The breast-implant business is but a modest grower and MNT’s dermal fillers are commodity products. PurTox, on the other hand, has a bona fide chance to be a mega-blockbuster in the right hands because it is technically superiority to Botox. MNT was hardly the ideal company to exploit this opportunity, especially in non-cosmetic indications.

I first mentioned PurTox on this board five years ago when MNT licensed it from the University of Wisconsin and it didn’t yet have a brand name: #msg-1936203. Now, the phase-3 clinical trials for cosmetic use are almost done.

Despite a 92% premium to the market price, the $1.1B buyout price (including net debt) makes this is a great pick-up for JNJ. PurTox alone is worth almost that much, IMO.