It is just back of the napkin, but taking out $16 million per quarter as expenses MNTA is gaining about $55 million a quarter at this rate. That is over $200 million in net cash for 2011, meaning that MNTA should exit 2011 with over $400 million in cash and equivalents (including a/r).
Market cap is $879 million, giving enterprise value of $479 million at end of 2011 which is about 2x fcf. If lovenox market becomes less "speculative" vis a vie Teva the share price has to soar. If copaxone is approved the share price has to zoom, and by zoom, talking multiples higher, not just 25, 50%, or even 100%, but by multiples with this sort of cash flow, particularly given that the copaxone market should be very solid with the expected FUD to be the upcoming orals and how they may eat into the market (which will reduce the copaxone multiple from what it might otherwise be, but certainly nothing like the discounting given to the lovenox money which is discounted to the point that TEVA entry is almost guaranteed to happen in the nearer term).
Share price will fluctuate wildly, and a t-lovenox would hit the stock, but down to what? And a copaxone approval would rocket the shares back far beyond where it is now.
Risk/reward: I guess a positive risk/reward, if one wants a textbook definition, is with MNTA at present. Hate to utter that phrase at risk of it jinxing the whole deal, but it is what it is. Limited downside, likely multiples higher upon expected outcome if one believes that MNTA has produced m-copaxone to the same degree of sameness that they produced m-lovenox, and no one else seems likely to be able to do so.
And this ignores the FOB assets (I am ignoring M-118 and the new cancer agent in their entirety. M-118 is looking less and less viable as time drags on and the new cancer drug is too early to pay much heed to at present, other than its development costs).
Tinker
AI
