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Biotech / Medical : Biochem Pharma (BCHE)
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To: Jean-Robert Grenier who wrote (472)10/7/1998 12:06:00 PM
From: alex gurion  Read Replies (1) of 783
 
Glaxo was up $1.625 based on FDA panel recommendation. GLX has
1.79 Billion shares outstanding. It means GLX has added $2.908 Billion to its market capitalization.

BCHE has 108 million shares and market cap of $1.91 Billion. It means that GLX has increased its market cap on this news more than the total cap of BCHE.

GLX P/E ratio is 33 which means investors pay $33 for each $1 of
GLX earnings. Currently GLX pays about $130 Million in royalties
to BCHE. Let's say royalty will increase by $130 Million after
lamivudine will hit the market.

$260 Million of royalty is a net expense for GLX. In my humble opinion GLX can easily pay 33 x 260 = $8.58 Billion for BCHE based just on royalties payments plus get research plus all other
stuff for free.

$8.58 Billion / 108 Million shares = $79.4 $/share

Any objections?
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