I did a detailed DCF valuation a while ago based upon publicly available information on market sizes, orphan drug prices, trial success likelihood, royalty rates, etc for NNZ-2591. Thanks to many on this forum for having provided links to various sources that I was able to use in doing this. My model, even with the most conservative numbers in it, actually showed results very similar to what reggie78 has outlined above in next 5 years. If you apply standard PE multiples to reggie78's numbers you get what I found. But the resulting implied valuation for Neuren was so high that I avoided mentioning it in the forum as I didn't think I'd be taken seriously.
I suspect I'm a naive newbie on pharmaceutical investment (Neuren is my first foray in this area starting 6-7 years ago). From my naive perspective it seems the two biggest downsides risks for Neuren (failure to achieve a Ph III and drug approval, and running out of funds) are about to be removed. The upside risks to me seem mind boggling (several orders of magnitude company valuation increase in 4-6 years). Yet more experienced hands than I still seem to think an imminent takeover at $8+ a share is the most likely, and preferred, outcome.
Can others tell me what I'm missing and why my ideas of Neuren having a viable shot at becoming a $10-$20 billion+ company in the next 5 years is a pipe dream, not a realistic scenario? I must be missing something :-(
NEU Price at posting:
$3.94 Sentiment: Buy Disclosure: Held
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