Biotech Values

[mcbio]

Beyond the prostate cancer setting, MDV3100 is in a preclinical trial for breast cancer. Hung said that, as expected, MDV3100 inhibited testosterone-mediated androgen, which drives about one third of breast cancers; but in a surprise finding, researchers at the University of Colorado at Denver found that it also blocked breast tumor growth fueled by estrogen. "MDV3100 appears to bind to the estrogen receptor as well," Hung noted.

Medivation is sitting on about $180 million in cash as of last quarter. Hung is confident that available cash, plus expected pre- and post-launch milestones in the U.S. and elsewhere, will enable the company to meet its R&D obligations and the cost of fielding a sales force to co-promote MDV3100 – quite a position for a company that came close to shutting its doors a few years ago.

I'm not normally one to get very interested in biotechs after a sharp run-up, but MDV3100 is a late-stage asset that looks and sounds as if it has a good shot for approval and to be a blockbuster (possible best-in-class type of drug). It's also interesting to see that MDVN intends to co-promote the drug and that MDV3100 may have a role in breast cancer down the road. All told, even after the sharp run-up, the stock doesn't look unreasonable to me at the ~$1.5B market cap. Anyone have any comments about current valuation in light of all the good recent news and after the run-up? I assume we'll probably see them take advantage of the share rise and do some sort of offering soon.