Hey,
Just trying to do some more research and after some help from others that may have already done similar research.
I am trying to work out what i think the total addressable market is for Novosorb alone (ignoring Hernia/Breast Products for now)
at the moment I am looking at it like this and would love some thoughts and guidance who anyone who looks at this sort of stuff regularly if i am going about this sort of thing the right way.
Burns Addressable Market
As per the link below burns market is USD 2 billion in 2019 at 6.9% CAGR putting it at roughly 3 billion by 2025.
now my attempt at a conservative assumption is that Novosorb might be usable in 1/3 of this so i am assuming a $1billion addressable market.
https://www.grandviewresearch.com/industry-analysis/burn-care-market
Diabetic Ulcer Addressable Market
Now this is a huge market but i see Novosorb being applicable to a smaller number of cases than this total market size.
as per below link the predicted diabetic ulcer market by 2025 is 6.82billion.
so my attempt at a conservative assumption here is Novosorb might be applicable in 10% of this total in 2025, so roughly 700million.
https://www.grandviewresearch.com/press-release/global-diabetic-foot-ulcer-dfu-treatment-market
Conservative Total addressable market of Novosorb in 2025 roughly 1.7 Billion.(ignoring any R&D or hernia,breast,Drug eluting polymers ect)
So my next attempt at a conservative assumption is to say maybe PNV only get 20-40% of my assumed burns market
So (200-400million) and lets say they only get 10-20 % of my assumed diabetic market (70-150million million)
So from working that out.
270million to 650million revenue by 2025 on a product that has very high gross margin of 90% was it?
so trying to be conservative again, after all costs i am going to assume that 50% of sales is costs.
that puts EBITDA at 135m-325m per year (without any other products such as briefly mentioned above)
now this seems ridiculous but did the management say they expect this to only account for 10% of sales in future? or was that just burns??
anyway one more assumption. lets assume it makes up 50% of their revenue by 2025.
so roughly and with some shoddy maths thats put boards expectations by 2025 at something like 270 million to 650 million earning???
I HOPE this made sense to some people and was not to weird to follow, this is the first time i have tried to look at a company in this way and would appreciate any feedback or things that i am missing when trying to look at a company in this way...
I am aware that the biggest factor here is my assumptions which is a dangerous thing obviously but has anyone else done something similar?
Feedback welcome please.
(20min delay)