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Biotech / Medical : Dov Pharmaceutical, Inc - DOVP -- Ignore unavailable to you. Want to Upgrade?

To: nigel bates who wrote (135)4/25/2006 4:53:01 AM
From: Robohogs  Read Replies (1) | Respond to of 172
 
It would seem that as long as the money is not burned senselessly, that a multiple of 6-10x might be appropriate, and with NOLs and the like shielding taxes, that would be something like $200-500 MM (if one believes they can do $1.6 B eventually). This could get interesting. I would want to see $5-6 before pulling the trigger though and have a sense of what the plan is. They might always sell the royalty and restructure biz using the cash for new products - which would not necessarily be good.

Jon



To: nigel bates who wrote (135)4/25/2006 7:15:40 AM
From: rkrw  Read Replies (2) | Respond to of 172
 
Top of my head, the royalty rate is 3.5% but moves up to 6% in about 5 years.

NBIX bought the wye royalty stream a couple of years ago would be a place to start. Again, guessing the rate was 2.5% but expired about 5 years out, when the whole thing goes to dovp. Price paid was $95M, part cash part stock.


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