Biotech Valuation Message Board

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Biotech / Medical : Biotech Valuation

CRSP 61.97

-3.2%

9:30 AM EST

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To: quidditch who wrote (6056)	3/28/2002 2:31:08 PM
From: Biomaven	of 52153

quid, The 7X-8X revenue number you infer is too low - I was discounting the implied current stock price to allow for the fact that the peak revenues are several years off. Price-sales ratios depend on remaining patent life (which is why MRK trades now at under 3X sales), margins, peak sales potential and potential competition. AMGN has recently traded at around 15X sales - it used to be higher. DNA trades a little over 12X sales. SEPR currently trades at around 10X sales, which is cheap given Xopenex is still growing rapidly and they also have royalty income which deserves (but doesn't always get) a higher multiple. Peter

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