Replies to post #212311 on Innovation Pharmaceuticals Inc (IPIX)

[BooDog]

I'm thinking of two, Genentech and Merck. There are some hungry big pharmas out there. Just a matter of publishing full data and planning the next step into further trials and marketing.
And lets talk about "compassionate use" coming into play as well.
Of course there are some other hungry BP's out there as well.

$IPIX


I'm still accumulating.

[scottsmith]

Nonsense. Contingent value. Means something has to happen first. Regardless, the poster is correct. It is very rare to see BO premiums of 200 percent or greater. This is easily verifiable with a minimum amount of effort.

[TradingPro]

I owned Trius and Durata they got bought out and each had contingent value rights associated with the deal. Durata for example got bought out around $25, and had in addition $20 in future CVS, $4 per CV. Each CV was for future milestones like approvals, and the last one was for a total amount of revenue generated after 3 years. They can be for about any risk the acquirer wants to mitigate, even trial phase II & III starts. So I could definitely see IPIX having a deal with associated CVs. Durata had a lot of naysayers and shooters boasting about how it was going down big. Then the BO announced, it was comical. Shorts were shell shocked for many days on the message boards. At first in denial, it was very entertaining.

[mantis]

Well, of course you can find a few exceptions, but counting Contingent Value does not really makes sense.
What I am saying is - each company's market cap is defined by a market - millions of active traders, thousands of investment professionals and hundreds of analysts. Of course they all have their own opinion about valuation , but in a process of trading the value of the company gets to some median point.
And if tomorrow some BP decides that it would rather snatch the small pharma today before it becomes too expensive ( after some trials results ) , and it pays a hefty premium - it all makes sense. But if it thinks that the company worth 10-20 times more than its current value then it raises some question:
- is everyone else blind not to see it ? If one BP is eager to pay huge premiums, the investment world usually sees it and the value goes up in advance.
- If we assume that one BP is willing to take the risk of unproven drugs while others don't then why can't they buy the company for 2-3-4-5 times the value instead of 10-20 ?

Don't get me wrong - I am all for BP buying IPIX for billions , we are just not at that point yet. Our intrinsic value at this point is not that far from out market value of 100 million.