Hi JDP,Quiet the opposite. It's not that I value RAC so...

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Titans19

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14/02/20

21:15

Post #: 42945439
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Originally posted by johndprent: ↑

Hi Titan,

I have been looking at some others (I didn't dig that deep) - however your question "if I found any with small listed biostocks like RAC". From what I can see, Agios was a small unlisted biostock, like RAC. They had been performing preclinical work prior to the partnership with Celgene and that had been showing promising results. The Celgene partnership was worth US$351.7 to Agios (who still distribute directly in the US) - not including NPAT royalty payments for Celgene to distribute globally. This included a US$120m payment for Agios to commence trials (which from memory were subsequently approved by the FDA straight out of stage 2).

A question I would ask you is; why do you place so little value on RAC? Why do you only expect an upfront payment of $10m? Celgene took on a fair bit of risk (i.e. Tibsovo failing), however; they also wound up with quite the deal. I don't know the complete distribution of sales so I can only speculate; Tibsovo is expected to hit peak sales of US$300m. If you assume half of those sales occur outside of the US that is US$150m for Celgene (minus royalities).

For the sake of round numbers; say Tibsovo generates Celgene US100m after royalty payments to Agios. They aquired the right to distribute it for US$351.7... bargain. I f you consider RAC's potential market I'd argue that US350m for global distribution rights to Bisantrene would be too bloody cheap.

Quick (un-referenced) response as I'm off to the pub. DYOR.

Edit: Agios didn't dilute the company - they just reduced earning potential.

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Hi JDP,

Quiet the opposite.

It's not that I value RAC so cheap, it's that I dont think RAC should give their IP away cheap. PM stated he would be surprised if the 5 path strategy cost $10m. Dr T also stated that the business plan is a liquid event in 3 years. The business plan only includes the 5 path strategy, so why take more upfront than whats needed.

RAC will be worth significantly more once the trials commence and path 1, 3 and Israel trials have good results.

Once this happens big pharma will offer top dollar for Bisantrene. You wouldn't want to give too much of that away too early for only a couple hundred million.

I value RAC rather highly. Just pondering on how they're going to let the market know how they will show their true value.

Enjoy the beers!

Cheers

RAC Price at posting: 34.5¢ Sentiment: None Disclosure: Held
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