Yeah I didn't dilute those quick calculations taking into account Evogenix. I'll try to do it properly this time.
If we firstly assume, ie IP is worth $0 for both PTD and EGX, we would get around $270m (incl EGX's cash and ST revenues) and assuming royalties for Humira and Remicade do not grow (although most expect CAGR to continue at ~20%).
EGX shareholders will get 15c cash, 139m times .15 = $21m (I think you calculated both PTD and EGX shareholders would get 15c)
So say $250m/234m= $1.07 of almost ceratin base value,
At the current price of $1.44, the market is valueing all of PTD and EGX's IP post merger at (1.44-1.07)*234m=$86 million. This is opposed to pre merger (after reducing 20c for SP inflation due to PE speculation) of $1.7*164m-$260m=$20m. So $66m for Evogenix? If the market thinks it's less, Peptech will still fall more.
Even a conservative risk adjusted DCF of PN0621, using average success rates and a tiny market share has an expected value of $100m+. If they can succesfully get PN0621 through Phase III trials and get it on the market, it has serious advantages over it's competitors in a $20bn market. If you want to dream, say PN0621 gets approved, Peptech gets 25% royalties and captures 30% of the TNF market (of $20bn which is possible as it will be able to price most effectively), for 10 years. On approval with 15% discount rate, we get a value of $1.5bn*(1-1.15^-10)/.15=$7.5bn (and a new millionaire), of course its probability of success to get approved is around 15-25% and it's market share is unlikely to be so great.
The Evogenix platform technologies are good enough for GSK and CSL to use, although I suspect not quite as innovative as some others in the world such as owned by CAT, Domantis and Morphtek. Peptech would need some kind of humanisation platform to convert their mAbs in their pipeline anyway so I think in the long run the synergies are there and also for Evogenix, they need cash for clinical trials.
Australian Pharma/Biotech has never had any success in commercialisation thus far apart from Gardisal, which is a vaccine with little pricing power, and Relenza which by all respects was a fairly terrible experience (unless they successfully sue GSK). Therefore the market heavily discounts any possible future value biotechs may have. Currently in Australia, it's a terrible industry in terms of profitability. However there are not many other companies I can see which have a decent chance of increasing 10, 20 or 30x in the next 5-10 years. Not for the faint hearted or impatient though.
To be honest, I doubt the price will rise very much in the short term as Aussie Biotech must first demonstrate some precendence for commercialisation success.
PTD
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