It might be a good exercise to back out the FluMist revenue projections and look at MEDI's other products' value. I believe it was Miljenko who once told me to invest in the program (molecule) not the company. This may be a good case in point. FluMist's prospects are iffy, even with Wyeth developing a refrigerator friendly version and running trials to expand the label. The too high price will render all that moot. At the advice of rkrw (who also has an interest in AMEV), I listened to Friday's presentation.
Synagis is going great guns, and the 2nd generation compound, NuMax, -- from AMEV -- looks really good. Virtually wipes out RSV in the lungs of cotton rats (the standard model), and reduces it 1000 fold in nasal tissue. In the latter, Synagis doesn't even manage a 10 fold decrease. This could prevent a bunch of other respiratory problems for those premature/underweight kids. They're in PI now with healthy adults and will be soon in infants, and they'll be putting it into PIII against Synagis in a year after doing PII trials in the southern hemisphere during our summer. Vitaxin (AMEV again) is also coming along in RA and melanoma. PII data out next year. Ethyol is growing nicely. Micromet stuff is too early, but interesting.
In other words, MEDI is about to get caned -- and rightly so -- over paying so much for FluMist and getting so little from it. But everything else looks awfully good. If we can tell when the FluMist flop is priced in, it could well be an attractive entry point. Given that the MC is about $6 billion, and they paid $1 billion for Aviron (plus some development & marketing cost since), I'd say below $20 is a buy.
As much as MEDI's research sucks -- most of their good stuff is inlicensed, and Rick is probably correct that they flubbed with 507 by not trying a lower dose -- their clinical development team is first rate.
Cheers, Tuck |
