Protein Design Labs (PDLI): Stock strong Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Biotech / Medical : Protein Design Labs (PDLI): Stock strong

PDLI 2.470

0.0%

Jan 18 4:00 PM EST

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

From: tom pope	6/18/2008 10:30:48 AM
	of 407

More from Merrill, on the bap news Good for PDL, gauging potential impact of bapineuzumab We believe that PDL stands to receive royalties on any sales of Wyeth-Elan’s bapineuzumab, the humanized monoclonal antibody in phase lll development for the treatment of Alzheimer’s disease which could be a blockbuster. We currently have no estimates in our royalty model, but with encouraging top-line phase ll data reported, we estimate the hypothetical current value of risk adjusted future royalties at about $0.10 to $0.67 per share based on various scenarios. Maintain Buy. Potential upside to current estimates We estimate that PDL could receive a 3% royalty on any sales of bapineuzumab, which could potentially launch in the 2010-2011 time-frame. In the valuation model, we estimate an NPV (at launch) of bapineuzumab sales in 2011-2014 ranging from about $3.1bn to $5.2bn, representing an NPV (at launch) of potential royalties to PDL of about $94-157mn. We then risk adjust the NPVs and discount back three years at 10%. Using risk adjustments of 20-80%, we estimate those potential royalties represent current upside of about $0.10 to $0.67 per share. For example, using our pharma team’s estimates of $1bn in 2012 and 40% probability of launch, we estimate that the antibody means about $0.27 of current value (upside to the stock). Our model only includes sales estimates through 2014 as the Queen patents expire near the end of that year. (See model at page 2). Maintain Buy We believe PDLI stock is undervalued at current levels, as we believe the Street is underestimating the prospects of the planned spin-out of a separate biotech company. There could also be upside to estimates for the planned royalty holding company thanks to antibodies such as bapineuzumab.

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next