This may have already been covered in another thread however do we have a clear path to profit (assuming trials are successful). Paradigm have clearly stated the opportunity set however one question still remains for me, how much will Paradigm charge for their product?
Below is a really good article for valuing biotechs and it states "that profitable biotech companies trade at 25 to 40 times their earnings. Other analysts use a multiple of 30."
Considering its current valuation of approx $600M, Paradigm would have to be recording an annual profit of $24M (based on conservative 25 P/E ratio) to justify its valuation. This profit figure is highly dependent on how much they will charge so I'd be interested if anyone can shed some light on this? I'm assuming pricing power for a biotech with patents.
I'm relatively early on in my investing career so any insights would be helpful.
PAR Price at posting:
$2.51 Sentiment: Hold Disclosure: Held
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