@Cato I agree with you that if Novartis pull out we will be back into the $1's. Most of us here are of the concenus that this is highly unlikely. The market also seems to think so too given the recent up trend sparked from the FDA's Biogen decision (+31% from the low of $1.77). So in the short term it is riskier (<6 months), however with Remestemcel-L looking for a potential approval within 6-12 months it is not unreasonable to think that this approval alone would support a sp of $5+ based on the below reasoning.
When Remestemcel-L is approved for pediatric acute sr-GvHD it is estimated to bring in $75-$125m USD in revenue (based on 500 treatments annually and priced at $150,000-$250,000).
What many have overlooked is that once approved Remestemcel-L will also become available for off-label use, which I believe will be used significantly due to the strong safety profile and anti-inflammatory moa. Currently in the US 20% of prescription medicine is used off-label. Some medicines experience 40% off-label use in adults and 90% off-label use in pediatric patients.
Doctors could potentially start using Remestemcel-L as a promising last line therapy for Adult Sr-GVHD as well as on ventilated ARDS patients under 65 given the current evidence supporting efficacy. Doctors may also use Remestemcel-L as a potential last line therapy for other indications such as chrons or ulcerative colitis.
In my opinion this will drive significantly greater sales of Remestemcel-L than most predict/expect from approval of GvHD. If this were to occur, than potential revenue for Remestemcel-L from approval of sr-GvHD and off-label use based on the above assumptions could be $90m-$230m+
Based on the highest annual operating loss Msb has had in the last 5 years of -$89.7m, this gives a potential annual profit of upto $140m. Based on a p/e ratio of 20-40x it would not be unreasonable for this to support a share price of at least $4.33-$8.66. This excludes the potential value of CHF, ARDS, CLBP, other treatments and the 1,000+ patients.
PLEASE NOTE I AM NOT A FINANCIAL ADVISOR AND THESE ARE MY OPINIONS ONLY.
https://www.nejm.org/doi/full/10.1056/nejmp0802107
https://www.mja.com.au/journal/2006/185/10/label-use-medicines-consensus-recommendations-evaluating-appropriateness
Moderated, page-256
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