Valuing biotechs is dependent on the observer. I observe a company with a total market cap of about $95 million (19 million shares out, undiluted), about 18 million in cash, a valuable partnership with good funding, patents galore, and a respected gene-regulation program that is not partnered. They seem to have patents which clearly stake out the dimerizing system (see their web site) for regulated gene expression. Their high-throughput chemistry is excellent, so they are compeititve in this world of combichem mania. The SH2 domain work is top notch, and, IMO, gives them a leg up on selectivity of disease intervention which Sugen lacks. The HMR collaboration was retained while Immulogic, Alteon, etc. were dropped, further testifying to the excellence of the SH2 work. I guess I just feel that they are clearly among the leaders in two hot areas, intracellular signaling (they are also moving into STATS, which should attract the attention of Ligand freaks) and gene regulation. When I look at the combined market caps of Transkaryotic Therapies and Sugen, I feel that a market cap of $150 million for ARIA is cheap, cheap, cheap. Hope that answers your question. Valuing patent portfolios is a highly personal pursuit. :-)
IMO, Amgen would have been in great shape had they picked up parts of the Cell Genesis program and stapled it into ARIA. Today's news release for CEGE shows that HMR has picked up the CEGE system for the expression of epo, so scratch that idea. Novel expresson technology can be licensed on a protein-by-protein basis, and ARIA's program appears to get better by the day. The science is as good as it gets, IMO.
I think that somebody listed the ARIA web site earlier in this thread. It's a great starting point for analysis.
Disclaimer: I own ARIA, do your own homework. Biotech investments involve above-average risk, and I am not qualified to make recommendations.
Rick |
