Replies to post #3860 on Enanta Pharmaceuticals Inc (ENTA)

[alertmeipp]

If they secure a partnership for RSV and drop the patent lawsuit, their royalty and cash interest income could provide a substantial runway to focus on immunology. However, I believe the lawsuit was never about winning outright—it’s about negotiating a settlement. Their goal is simply to demonstrate that their chances of winning aren’t negligible.

[Rocky3]

Appreciate the thoughts but other than cash your analysis effectively discounts all other assets such as retained royalties and Zelicapavir - just to name two.

The retained royalties are not enough to pay the company's expenses, so I would argue that they have no value for a going concern business. Zelicapavir may have value (maybe significant), but its development costs are an offset against whatever value it has. A long here has to be very comfortable that those expenses all be covered by its cash. Most here clearly are.

If you’re not willing to “take the risk now” in what situation would you ever be comfortable investing in a biotech if that is your investment risk threshold?

Right now only TGTX and VKTX fit my risk threshold - for very different reasons. TGTX is profitable (barely) and has a huge runway (or at least I think it does). VKTX's upside is enough for me (though my position is 1/6 the size of TGTX), especially at 40. Together they are larger than my positions in GILD, MRK, NBIX, BMY, and ABBV. And all of pharma is less than 10% of the total portfolio. But I find biotech fun to follow.