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Global Biopharma Outlook 2012 - Rising Stars and Mature Biotech
MP Advisors, Jan 2012, Pages: 130
Global Biopharma Outlook 2012: Rising stars and Mature Biotech
The Rising Stars (non-profitable biotech/ biopharma companies) chapter reiterates that Innovation and improvements will continue to flow from the backyards of small research focused companies. There is likely to be a Paradigm shift in investment pattern- choosing upside from early mid-stage products and not from to launches. 2012 will be a testing time for recently approved drugs as many of the innovators have taken the responsibility of selling the drug in US on their own (REGN, INCY, VRTX etc)- Will they evolve into a mature biotech or remain a shining star only? In-depth analyses of specific companies, investment recommendation valuations are included
MP Advisors' definition of Mature Biotech (MB)- companies which have reached sustainable profitability by generating revenues from product/s innovated, developed and generally commercialized in house. Robust earning from majority of the companies cheered investors. Restructuring, cash return to shareholder in form of dividends and share buyback along with promise to create further value sustained optimism in 2011. These companies are – entering 2012 with high expectation - “Only Green – No Red”
In-depth analysis and investment recommendation assessed by MP's proprietary Sum-of-the-Part-Valuation are included in the chapter. MP Advisors' Proprietary Sum-of-The-Parts Valuation) quantifies the difference between the current equity value and the value arrived using our valuation method comprising three parts, i.e., Part A, Part B, and Part C as described below:
1. Value the marketed products till their respective patent expiries (Part A);
2. Value the late stage pipeline as of today (Part B) (Consider only the late stage PhIII and registered products).
3. Value the management's ability to convert early stage R&D activities into mainstream products and company's strategic approach- historical and visionary, by giving a premium to their future cumulative R&D investment (Part C).
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