When you analyze the financial statement projections and discounted cash flow analyses the equity research analysts use in coming up with their price targets for Provectus, two interesting toggles are treatment price and gross margin.
Treatment price can be influenced by several factors, including reimbursement and competitive. Gross margin, on the other hand, is strongly influenced by the company's approach to manufacturing product. Contemplating price is of course premature in the context of the company's development stage. Taking a logical but long-term view, however, it is easy to see analyst valuation, as a proxy for valuation in general, several multiples higher (e.g., 3-5x) when considering that (a) their price assumptions are a fraction of other cancer immunotherapy products and (b) gross margins are at least 90%.
This merely is one way of toggling valuation.
Recall management's efficiency of trial design and execution. The result is a dramatically lower accumulated deficit. Imagine the flexibility the company has, or its eventual acquirer will have, competitively and predatorily all things being equal (robust efficacy, tremendous safety profile, ease of administering). Management has been very thoughtful in how this can play out at the appropriate time. I do find the ability to lower price to increase market share or to be more conducive to government reimbursement/payment a category killer so to speak. This bears watching during end-game discussions.
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