Replies to post #62224 on Biotech Values

[DewDiligence]

>IMO MNTA’s tech. is not required to fulfill scientific issues for characterization of Lovenox generics.<

I’m curious as to why you say this—please clarify. T.i.a.

I added your numbers to the valuation table.

[DewDiligence]

Musings on MNTA’s Valuation

Several posters have assigned probabilities to the four
mutually-exclusive cases described below to arrive at
the fair value figures shown in the following table. The
market caps and share prices corresponding to each
case pertain to the time interval 9-12 months from
today (i.e. Feb-Apr 2009).

All posters are welcome to submit their own
probabilities or alternative analyses.

 
           ($57)  ($24)  ($11) ($5.5)  Fair  
          Case-1 Case-2 Case-3 Case-4  Value 
 ThomasS    70%    10%    20%     0%  $44.50 
 zipjet     50%    40%     0%    10%  $38.65 
 Dew        54%    28%    12%     6%  $39.15 
 JR*        20%    40%    25%    15%  $18.10 
 stockdak   20%    70%    10%     0%  $29.30

*JR assigns prices of $35, $20, $10, $4 to the
four cases in lieu of the prices specified below.


Description of four cases:

The following background assumptions apply: MNTA continues to make steady, but not spectacular, progress on M118 and other non-Lovenox programs; the US passes legislation enabling follow-on biologics during 2008 or 2009; MNTA does not sell shares before the status of the Lovenox ANDA is cemented; Sanofi fails to reinstate its US Lovenox patent; MNTA does not receive a buyout offer.

Case 1: MNTA/Sandoz obtains approval for generic Lovenox and neither Teva nor Amphastar obtain approval within the next 9-12 months. (Sanofi may decide to launch an authorized generic, but it would be the only generic in the market other than the one from MNTA/Sandoz.) Market cap: $2.1B; share price: $57.

Case 2: MNTA/Sandoz obtains approval for generic Lovenox and Teva or Amphastar do also. Market cap: $900M; share price: $24.

Case 3: Nobody obtains approval for generic Lovenox within the next 9-12 months, but the ANDA from MNTA/Sandoz remains under consideration by the FDA pending resolution of certain issues. Market cap: $400M; share price: $11.

Case 4: FDA rejects MNTA/Sandoz’s Lovenox ANDA with no possibility of a resubmission. Market cap: $200M; share price: $5.50.

[jshaffer85]

re MNTAs tech. is not required to fulfill scientific issues

Than why hasn't the two year head start on filing that Teva and Amphastar hold resulted in a tentative ANDA approval pending the Paragraph IV challenge?

The game changing event here may well have been the heparin contamination problem and how that could raise the bar to full characterization for ANDA approval.