I've done some more detailed modelling on Daybue revenue with 7 years to peak sales North America, 8 years to peak sales ROW, with ROW sales starting in 2026. I've assumed ROW royalties at 15%, 17%, 19%, 21% ("mid-teens to early twenties"). Have assumed the ROW milestone payments similar structure to US - $50m + $50m + $100m + $150m (total ~$350m) with targets 25% lower than US.
$375k per annum per patient, with an annual average price increase of 3.5% (refer to
https://www.bmj.com/content/381/bmj-2022-073242 where average historical orphan drug pricing has increased 3.7% per annum).
Scenario 1Peak US sales US$760,000 (2,000 patients = 20% penetration of US + Canada). Peak ROW sales is 75% US sales (historically ROW sales have equaled US sales)
Scenario 2Peak US sales US$1b (2,700 patients = 27% penetration). Peak ROW sales is 75%
Scenario 3E&P's latest report projected 50% of patients will try Daybue with a 60% persistence rate. This would give 30% long term or 3,000 patients. In this scenario I'll assume ROW revenues reach the same as US market.
I've modeled out to 2038 and made no allowance for a terminal value or ongoing revenues after that point. Discount factor = 12%. AUD/USD 0.64 and company tax 30%.
The resulting DCF current day value per share for Daybue (AUD) is:
Scenario 1: $14.50 per share
Scenario 2: $19.00 per share
Scenario 3: $23.00 per share
In conclusion, on Daybue alone the current share price undervalues Neuren even at the most conservative scenario I've looked at.
Based upon this there appears to be zero value attributed to NNZ-2591 in the current share price.
A takeover at $30 would therefore attribute a value to NNZ-2591 equal to or less than Daybue.
(20min delay)