Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Biotech / Medical : Encysive Pharmaceuticals (ENCY) -- Ignore unavailable to you. Want to Upgrade?

To: rkrw who wrote (8)	12/19/2005 3:27:30 PM
From: tuck	Respond to of 205

>>I don't think selling will be a problem. Doesn't take a ton of reps or budget and I'd bet a bunch of them will be ex-actelion. The problem is more it's a 500M market (with good growth) and will be sliced 3 ways, so it's now looking like thelin at 200M per year (30% share) would be considered a success, 300-400M (50%) would be a HR. It also becomes a game of finding promising new indications. I'm a big believer in eps modeling at this stage, what's does a low/middle/best case scenario show?<< Well the quick and dirty approach can be found here: finance.yahoo.com But Ambrisentan would hit the market in '07, probably in the 2nd half, so that might slow Thelin down a bit. Of course, ARIES 1 is still out there, but will be known well before then, 2Q06. If the results don't mirror those of ARIES 2, what happens? Inhaled Remodulin in '08 (the FDA's view of Exubera might provide a preview for handicapping inhaled Remodulin's chances)? Anyhow, the most optimistic analyst says $100M next year. Not sure what launch date that might be modeled on, but with the PDUFA date in March, I'd guess we'd have have ~8 months of Thelin sales next year. Given that other revenues will be about $4 million. I would guess there is not much variance in the launch dates used in various analysts' models, so the big variance must be in how well they all think the launch will go. If we assume the competitive landscape remains unchanged through the first half of '07, the optimistic case would be for an annual run rate of roughly $140 million for '07. I would also guess that R&D expenses would be flat (down for Thelin, but up for other stuff advancing in the pipe), while SG&A would be popping hard in '06 then leveling off. Let's call expenses an even $100 million for '07. That would drop about $40 million to the bottom line with about 60 million shares out by then. The pessimistic case extrapolates to roughly $40 million in sales with the same expenses. While the average case extrapolates to about $90 million in revenue. So my '07 eps guesstimate range: (1.00/sh) to 60/sh. With the middling revenue estimate yielding a slight loss. On a quarterly basis, breaking even or turning some profit by Q307? Now, I've seen market figures of up to $900 million in '09. If ENCY can manage a 20% share, that's going to be a buck and quarter per share or so in earnings. This is not counting their dermatology product, which may add a little value by then. Seem plausible? Edit: Actelion trades at a P/E of 27. I could see ENCY earning 2 bucks/sh in 2011, which would give a share price of about $55. I'd love to see an analyst's report from George or Steve or someone, with the financial projections and all. Hint, hint . . . Cheers, Tuck

To: rkrw who wrote (8)	12/19/2005 7:17:09 PM
From: dr.praveen	Read Replies (1) \| Respond to of 205

ENCY:Hi Jim, I respectfully disagree with you on this Jim:-) Tracleer and Thelin: The most important is safety. It is well known that Tracleer elevates liver enzymes more than thelin with a black box warning to its label. In a phase 3 clinical trial by Ency, the 100 mg dose of Thelin was associated with a 3% rate of liver function abnormality in the 18-week study, compared to 6% for the placebo. In the study, Thelin also improved the distance patients could walk in a six-minute period over Tracleer, although the drugs are comparable in terms of efficacy. Thelin also has a dosing advantage in that it only needs to be taken once a day, compared with twice a day for Tracleer. That should improve patient compliance and make it a more desirable treatment option. Also Tracleer recently burnt it's finger by failing in Idiopathic pulmonary fibrosis trial and I think thelin will fail too but it is smart in not wasting it's resources. Thelin And Ambi: Ambi recruited all classes from Grade 1 to grade 4 Pulm HTN patients while Thelin went for grade 2 to 4 pts (More worse pts) Ambi had a criteria that it took only pts who were able to cover 150m in 6min which implies its pts were more healthy. Thelin liver function tests were more more worse in stride 2 than stride 1 with more pts. It might happen with Ambi too but at present Ambi's LFT's were more better than thelin's Reg Ambi efficacy there was no tracleer arm to compare although it's results might be better. Ency has 2nd gen drug in trials for Pulm HTN which may or may not be better than Ambi. Thelin: The best case scenario is thelin will get sales of 400Milion$ by 2010-11. The worst case scenario is it will only get sales of 200Million$. Either way investment in Ency will get good returns but might not be a great one with some if's and and's in between. Dr.P