Peter,
even more useful exercise would be 10x in 3 years
Peter S, could you outline such a case for SEPR?
I don't actually think SEPR could produce x10 in 3 years - it is just starting from too high a base, as you would need a market cap > $10 billion. It's much easier to see x10 in 5 years, as by then it could look like a mini big-pharma, with serious revenue coming from all the antihistamines, and in particular norastemizole, which is 50-50 with J&J and could easily be a billion dollar drug. Within 5 years they could easily have 1/3 of the albuterol market, which is another $500 million in revenue to them. Add to these a deal with Lilly for Prozac II, and a deal with J&J for Propulsid II, and it's not hard to see profits in the $300m after tax or more range, with a steep enough growth to support a PE in the 30's.
Of the stocks I own, clearly MOGN could produce x10 in 3 years if MGI-114 turns out to be another Taxol, but this is a pretty low probability event. Similarly NTII could produce this return if Memantine turns out to be a winner, mainly because it is starting from such a low base. Of course NTII is probably equally likely to be a x0.1 candidate <G>.
My best candidate for a x10 in 3 years is PCYC. It's starting from a fairly low base after its recent decline (current market cap of around $200m, plenty of cash) and hasn't given away any US rights to its drugs. If GD-Tex works as well as I think it does and continues to show low toxicity, it could end up being used on most if not all radiation treatments (700,000 a year), which at a $2k or higher price per treatment is real money. Their artery roto-rooter application has similar home-run potential, but is earlier in their pipeline.
Peter |
