Is it possible that tunnel vision affects the valuation of many...

Is it possible that tunnel vision affects the valuation of many Aussie biotechs, more particularly ANP? The random thought occurred when I considered the list in Fierce Biotech of The 10 Highest value R&D projects in biopharma published 5 September 2023. In searching for some point of relevancy for comparative purposes, I scantily reviewed Number 9 on the list. The product is a Phase 3 drug called Aficamten for cardiomyopathy by Cytokinetics.

A couple of things to note: the pipeline of drugs advanced by Cytokinetics are focused on muscle-directed treatments for diseases characterised by compromised muscle function, muscle weakness and fatigue; Aficamten is the lead program addressing obstructive hypertrophic cardiomyopathy and Cytokinetics are picking themselves up and dusting themselves off after the Phase 3 failure of an ALS therapy called reldesemtiv.

There is no point getting into the weeds because I'm simply looking for mispriced valuations between biotechs and in particular the potential discrepancy between valuations on the NASDAQ and the ASX. Now we return to the top 10 and No 9 on the list of the highest value R&D projects. The report states that worldwide product revenues by 2028 for Aficamten is expected to be US$1.7B providing a NPV of US$4.4B. So how does that compare to the current MC for Cytokinetics? According to MarketWatch, Cytokinetics has a MC of US$3.5B. Not too bad considering recent clinical history and the fact that Aficamten is the well from which the company hopes to draw short term future revenues.

NPV? Apart from giving lip service by analysts, does the concept rate for homegrown biotechs on the ASX let alone have relevancy to the MC!!! Not that I'm arguing, just accumulate.