Replies to post #111145 on Biotech Values

[Mpower]

Yes, it is a joke.

[tinkershaw]

to a $15 12-month price target.

It does not need to make sense as long as that is what the market will value it as. It is all perception. Anyone remember when DNDN was $2.50, or ITMN was less than 1/2 its current value (oh yes, last week). The buy recommendations only came thereafter.

Yes, until such time as copaxone comes to fruition, or the cash piles up and time go buys when Teva flaps its gums and gains no approval that perception will change.

During the last 2-3 weeks I've made some very nice profits on EXEL and MAKO. Pondering through everything as I did sell out my MNTA as there were just greener pastures at the time as the share price was clearly languishing. Give it 12-24 months (which is not a long time in investment parlance) and MNTA "reality" may come to fruition. Which means real world events will change the fear, uncertainty, and doubt. I am quite tempted to move some of these profits back into MNTA. As always thinking risk/reward.

It is one big advantage we have over institutional investors, in that we can look forward more than one or two quarters. And see through FUD. I think copaxone is the big event here that Teva cannot threaten. FDA gives copaxone the go ahead, and the share price will move.

In any event, the numbers and facts in the report don't fit a $15 price target, but it is reasonable only when taking into account the FUD surrounding MNTA. Resolve some of the FUD and there is a lot of room for share price growth. Goldman will thereafter move MNTA to a buy after the fact.

Tinker

[kris_kade]

GS report says overhang would exist until FDA rejects others ANDA.

If FDA has not rejected TEVa's or others ANDA yet, what are the chances they will reject soon ? Wish they have some definitive timeline like PDUFA.

[dewophile]

I'm sorry but I'm having a hard time equating "low probability of a competitor approval in the next few years" (with respect to mLovenox) and "high probability of generic Copaxone approval" (without even considering the rest of the pipeline) to a $15 12-month price target

easy. first start off underestimating the US lovenox market at $1.8B (SNY reports in euros and for the first 6 months of 2010 US lovenox generated over 900M euros so it could be as basic a mistake as forgetting to convert euros to dollars). then use the initial market penetration of 35-40% out into 2011, regardless of the fact the company has stated they are north of 40% market share, that NVS most recently mentioned they were at 50%, which is also supported by script data, and lo and behold you get an asset which you estimate will generate $3 a share in 2011 as a sole generic - which is about half of what anyone with a brain estimates lovenox will generate if mnta retains sole generic status. then underestimate mnta's royalty in a multiple generic scenario (.2/share or 11M/year) by a factor of about 3 (>1B in sales down to 120M with 1-2 more generic entrants - really??)..and voila - $15 a share
and to think people pay money for these reports