Biotech Values

[DewDiligence]

Re: Sovaldi

…would love to hear others' thoughts and how this will affect ABBV/ENTA.

Higher than expected Sovaldi sales in GT1, specifically, are bearish for ENTA, as we’ve discussed previously. (Higher than expected Sovaldi sales in GT2 and GT3 have no material effect on ENTA.)

The EMA’s compassionate-use allowance of Sovaldi + Ledipasvir is a non-issue, IMO; the EMA previously allowed compassionate use of Sovaldi + BMY’s Daclatasvir, but actual sales are de minimis.

Notably, even as Sovaldi’s US scripts continue on a rocket-ship trajectory, sell-side analysts are inching ever closer to the market-share and sales numbers in my ENTA valuation model—the latest example is BofA (#msg-97629251).

Other Sovaldi-related puts and takes for ENTA investors are enumerated in #msg-96802014.

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While you believe you are exploiting a market inefficiency vis-à-vis Sovaldi by buying GILD call options, you are also placing a bullish bet on GILD’s TAF, as noted in #msg-97350905.