once it hits the market, page-18

A simple way to look at this is in the latest investor presentation:

The lower range of forecast 2009 US sales is $250m (2008 was US$200m) for Arixtra

Alchemia to earn 50 - 60% share of profit

Profit to Alchemia equates to 30 - 35% of Generic sales

40 - 50% market share for 1st generics

So let's do our worst and use the 2008 figure of US$200m in Arixtra sales
x
40% market share = US$80m in sales
x
30% Profit to Alchemia = US$24m (Aust $30m odd)
-
AUD$5.5m cash burn rate = AUD$24.5m profit to Alchemia

This equals an EBIT of around 15c (you choose the PE you'd like here, 8x, 10x, 15x) Now I do know that I have not taken into account that they may not get that amount of market share in the first year of trade. But I have also used the old figures of 08 when the projected are US$50m more at minimal, the current acceptance/market share of generics in the US is more like 60/70% (I have made a post regarding this a month or so ago) and I put ACL at the lower 30% of total sales.

Please if anyone can point out to me if/where I may have gone wrong it would be much appreciated. We all know how the investing public look ahead and I would not like to be caught trying to predict entry on what may happen in the first year only!

Gluck all:)