XOMA. Bull or Bear? Message Board

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Biotech / Medical : XOMA. Bull or Bear?

XOMA 25.22

-5.0%

Dec 12 9:30 AM EST

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To: Robert K. who wrote (8238)	1/11/1999 5:42:00 PM
From: schadenfreude	Read Replies (3) of 17367

RobertK, I believe you misinterpreted the model. The model discounts unapproved drugs in clinical trials to account for the fact that some will never make it to market. For phase III, the discount is 0.5. For example, the calculation for hem trauma is 250,000 patients x 30% penetration x 0.5 = $37.5M. If Neuprex is approved for this indication, you would remove the 0.5 factor and it would be worth $75M. So the model is saying the stock is worth $7 now but more if phase III is completed successfully. While the model is far from perfect it's least a start. If anything, it's overly conservative. The model assigns a value of 1x peak sales for an approved drug. 3-4x sales seems more reasonable. Otaku

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