Biotech Values

[mcbio]

I finally got around to catching up with these guys. I must say that I see a lot more value in their shares than any other HCV company. Current marketcap is only $260M, which is half that of ACHN, yet has a partner in JNJ and collabs with the 2 leading nukes.

One of the big caveats is the royalty rate Medivir is due from JNJ on TMC435 potential sales. Medivir has never even stated they are due double-digit royalties, as they have with other drugs in their pipeline, so I think they may only be due single-digit royalties. But, as you can see by the chart, the shares have traded much higher when this question was obviously on the table. So, I think a lot of the weakness may just be due to the general EU issues. Of course, TMC435 needs to deliver on the top-line P3 results to be released by the end of the year and in the combo studies as well. As long as Medivir at least can earn a high single-digit royalty, I'm comfy with that at this valuation level provided TMC435 delivers in the clinic. Then there is the pipeline beyond including the HCV nukes and other non-HCV assets.

(Honestly, I think ACHN is in really terrible shape).

I actually disagree with you on ACHN. Though I don't like risk-reward as much as Medivir, they do have a few mid-stage unnpartnered HCV assets. And all it takes as one partner/suitor. As I've said before, in agreeing with jq, I think ACHN makes a lot of sense for VRTX because I think VRTX could use a 2nd gen PI and/or NS5A. But, I doubt VRTX will do anything prior to getting results from their two nuke combo. And MRK could be an option for ACHN as well given their apparent issues with their 2nd gen PI.