There seems to be a lot of hand-wringing and lamenting about management's lack of focus on increasing shareholder's value. The market performance of LGND in the last few years gives credence to your reasoning. LGND did indeed raise a lot of money (and stock) with ALRT; pharma deals with stocks sales at a premium; and the Glycomed acquisition. They have raised several hundred million dollars and increased the outstanding stock by 25 million shares. What have they got for it?
LGND describes it as a "embarrassement of riches"--" the biggest and best pipeline in the bio-tech industry". LGND's drug portfolio has the potential for several multi-billion dollar drugs for diabetes, osteoporosis, hematopoietic growth factors (epogen and neupogen), breast cancer,psoriasis, prostate cancer, and actinic keratosis. In addition they have a number of drugs for markets with a 200 to 800 million dollar potential for KS, CTCL, Hodgkins lymphoma, head/neck cancer, ovarian cancer, and kidney cancer. In addition! they have programs for hormone replacement, female reproductive disorders, hirsutism, acne, atheroscelerosis, inflamatory diseases, interferon agonists, interleukin, etc,etc. They have six of the big Pharma partnering on many of these programs. These programs, if successful, will also yield many billions in drug sales. Obviously not every program will be successful and some of these drugs are 3 to 5 years out. If most of these programs are sucessful LGND will join the ranks of big Pharma. Rick, I'm know you know all the above--you've got to admit that the LGND of today is enormously more valuable than the LGND of 3 years ago.
LGND management has been extremely! skillful in developing this "embarrassenent of riches". One could argue they might have done better in funding their research programs but you can't argue with the results.
At some point in the next 2 to 3 years LGND should have a market cap of at least 2 to 4 billion dollars which equates to a $40 to $80 market price based on 50 million shares. All things considered, LGND is the best long term bio-tech investment. All the above, of course, IMHO. |
