Evacet is a form of doxurubicin, not adryamicin...
It was rejected as a first line therapy.
Liposome could still apply for a 2nd line therapy for patients that experience heart toxicity with the regular doxurubicin. It will take more time, and more deals with FDA.
2nd line therapy is much smaller.
Expensive liposomal amphotericin (just ten times more expensive) pays its own way since usual treatment length is shortened to 5-7 days, from 21-28 days.
Kidney toxicity is clearly much, much less than regular ampho.
Expensive is a good charasteristic in biotech, company gets more income (look at the most expensive drugs in the market, they are from the most succesful biotechs AMGN, DNA, BGEN, MEDI, Ross, IMNX, CNTO, just name it).
Bigger problem is that there are 3 similar products in the market, but they have much of the US market, vs Ambisome which has much of the rest of the world. There is a price war among then, and a coming number 4.
So cheaper is the problem, not expensive.
They have more technology. And Evacet chances are less but not dead.
Similar company (ambisome producer NXTR) was acquired at about $8.5 a share (similar sales)
SEQU is another liposome producer (Amphotec) also acquired at about market value corresponding to about $5 share (very low sales).
Lipo should be value at about $4 to $5 if it can sustain actual earnings.
The rest of the company $1 or $2 dollars.
They have good cash some $50 M, this should add $1 or $2 a share.
Of course, the market is going to punish this one well below $5, about $2 to $3 as they did with previous failure with anti-ARDS drug VENTUS.
VENTUS value is zero at this moment, company is looking for partner. I strongly doubt anyone will come forward for Ventus.
Right now this is a falling knife.
But they have good cash, they could merge, or buy or be bought, not a bad play once it settles.
Despite Lipo poor victory on the patents fight against NXTR, Lipo was the winner indeed. |
