Jay....... yes, AGPH has been treating in kids for a few months, and I'm hopeful that the results will be ready for presentation at the retroviral meeting in January.
Let's start working on a valuation assuming successful (and expedited) interaction with FDA. If we assume $5K/patient/year and 200K patients (U.S. only), that's a market of $1 billion/year. Nobody wants to take ritonavir, so get rid of Abbott. Side effect reports (especially kidney stones) are increasing like crazy for crixivan. Saquinavir is still crippled with low bioavailability. Vertex/Glaxo are clearly behind AGPH. I therefore feel that it's fairly conservative to assign a 20% penetration for Viracept. I also feel that a margin of 50% is very conservative, ultra conservative, but I am flying relatively blind. That would be profit of $100 million/year, or about $7.90/share. Given that the cancer program is respected, well-funded (Roche), and has pipeline components that have not been assigned to a partner, I'd say that a PE of 25 is reasonable. Put all of these together, and you come up with a "conservative" (my opinion, do your own homework) target of $197 by, say, 6/98.
Any thoughts? Anybody else working up price targets based on different assumptions?
Disclaimer: I own AGPH and have a vested interest in its appreciation, so do your own homework. I am not qualified to make recommendations.
Rick |
