Replies to post #99608 on Biotech Values

[jbog]

DFRAI

When we look at the 'best case' of being 45% of "net profits" it always seems hard to define what net profits means beforehand.

In looking at NVS, we'll find their 'gross profits' average 71% of sales while their 'net income' (less taxes or financing) average about 22%.

So, I'm not sure if Momenta's take wouldn't be closer to 45% of $262 million. ($1.2 b x .22)

[turtlepower]

Regarding MNTA valuation, when one considers the multiple generic case or the AG case, the price reduction due to the competition has to be factored in.

So as an example if m-enox and lovenox are the only competitors then m-enox could have a 25% price reduction and the 50% share you hypothesized for m-enox will have to reduced by 25%, though 50% is likely too low of a market share. If Teva's generic gets approved and then SNY launches an AG, then there will be further price reduction and smaller market share to m-enox.

I think the current economy and the drive to reduce health care costs will be beneficial to m-enox and it could capture a substantial portion of the lovenox market.