NEU is materially undervalued, page-62

Hi baldwidx,

From the last update I did I got the following.

		US$ NPV as at Jan 2028	AUD per share
1	Daybue, Retts	$2.2B	$26
2	NNZ-2591, Phelan-McDermid	$11.6B	$140
3	NNZ-2591, Pitt-Hopkins	$4.6B	$55
4	Total	$18.4B	$221

This was the calculated NPV as of Jan 2028 if Daybue continues it's current mild trajectory and PM and PH are approved.

Discounting this back to the current date using a discount rate of 12% per annum reduces these values by 32%.

Average POS for Orphan Drugs Phase III to Approval is historically 66%. I think NNZ-2591 is more like 80-90% POS for PM & PH (refer to my previous arguments why). Positive FDA minutes will move the needle closer to 90%+ in my opinion.

So after these discounts we get $18 + $76 + $30 = $124. This is NPV as of Oct 2024 i.e. over 8 x current share price.

Of course, this completely ignores Neuren's potential as a platform drug targeting also Prader-Willi, Angleman, Retts (NNZ-2591), Fragile-X, plus a chunk of nearly 100 untreated neurodevelopment disorders.

Be conservative and say this upside is only worth the same as PM, PH & a fraction of Daybue Retts - and you get $250 a share. Be more realistic and say its probably worth 5-10 x the 3 indications above and you'll get.... ridiculous numbers.

I'm looking forward to updating these numbers again once we have the FDA meeting minutes and Neuren reveals pre-clinical results for the additional indications

Suffice to say if the coming news is reasonably positive and the analysis I did has any validity then $200 should be the starting point for any T/O negotiations..

If this is true, why are we at 8% of this value now? I have no idea.... Maybe the modelling I've done is actually nonsense...