Biotech Values

[Rocky3]

GILD - this week's scripts: 4114 NRx (up from 3434); 6398 TRx
(up from 5291)
From last week's Wells report:

(1) Base case secondary warehousing growth in new patient starts slows Q2Q3 then picks up again Q4 $ 7.32B, up from $6.82B
(2) Rapidly decaying Sovaldi new patient starts throughout remainder of year (bear case) $ 5.44B, up from $4.97B
(3) Sovaldi new patient starts level off for rest of year $10.26B, up from $9.44B
(4) Week over week NRx changes match those seen with Incivek+Victrelis at same point in launch $9.39B, up from $9.21B

Since this week's TRx is 1,100 higher. The numbers will be even higher. Pretty easy to see TRx at 10,000 if NRx stays over 3,500. Of course, that is the big question.

Using $25,000 per script (less than the $28,000 face and probably much less than the cost of the new treatment available in Q4), I am getting ~$1.5B for Q1, ~$2.5B for Q2, and $3B for Q3 and Q4. using the full $28K per script gets one to $11B for the year. If NRx keep growing at 10-20% per week the numbers are bigger and bigger.

Pretty fully loaded, but hard not to buy more at these prices.

Also, the number of new scripts (4K+) is getting a little amazing. Is the market much bigger than everyone thought or are the patients being treated much earlier and therefore will not be there for the new treatment for GILD and ABBV/ENTA. 200K+ new patients is a big number.

Just very interesting to watch.