PYC might be approached with an offer by a "Monster Pharma Co" in the same way as Dicerna was bought by Novo Nordisk? As PYC has a platform technology but no approved drug (yet) we might assume a similar sale price...US$3 billion. That would equate to a SP of 10 where we are now...roughly AD$1.30-1.40.
I certainly wouldn't expect that at this point, for a number of reasons.
Firstly, although Dicerna is yet to have its first drug approved, its pipeline is much broader and deeper than PYC’s. It has 18 candidates in its pipeline; 6 are at clinical stage. Of these, one is Phase 3 and there are two Phase 2 assets. In addition, a number of its indications are in very large markets.
Secondly, Dicerna had already struck deals for most of the candidate drugs in it pipeline – Novo Nordisk was already a partner, but Roche, Lilly, Alnylam, Alexion and Boehringer Ingelheim had also struck deals with Dicerna.
Thirdly, the US$3.3bn paid by Novo Nordisk represented an 80% premium to Dicerna’s market cap. An acquisition of PYC tomorrow at 80% premium would represent just US$533m.
If you look at the progress of Dicerna, it was founded in 2007 but not floated on the NASDAQ until January 2014. Although its market cap has since grown substantially (from US$680m), the share price on IPO in 2014 was US$41.12 which compares with US$38.22 paid for its recent acquisition! Its stock price fell to as low as US$2.50 in early 2017 (meaning a market cap of just US$50m) but has since risen on the back of advancement in clinical trials and licensing deals that it has struck.
Dicerna forged its first (small) pact with pharma in late 2017, shortly after commencement of a Phase 1 trial of its leading candidate. Deals with both Lilly and Alexion were then struck in late 2018, immediately following release of Phase 1 data that demonstrated preliminary “proof of concept”.
What I infer from the Dicerna story is that, while a platform technology can indeed springboard a company to great heights, initial proof of concept in clinical trials provides the main bounce.
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