Blog Reader Question

As investors in PVCT we all are looking for the end result to be getting acquired by a large pharma company. Could you quantify for me your thoughts on what large pharma will eventually pay to acquire the whole company? Could you break it down into two prices. One being with PV-10 designated as systematic and the other price if the designation is strictly local.

Local treatment value. The acquisition of BioVex and OncoVEX by Amgen for about $1 billion, $425 million upfront and $575 million in additional development and sales milestones, provides a good baseline for the value of the company strictly as a local-regional treatment. Making a few assumptions (e.g., using melanoma as the lead and primary indication, the fully diluted share number, applying certain discounts to the headline number to adjust for present value and other things, etc.), I'd see a share price in the range of $3 to $5, where I'd lean towards the higher end of the range.

This analysis does not ascribe value to the application of PV-10 to other indications beyond melanoma or PH-10 to inflammatory skin disorders. If we add other indications, like scan-guided treatments of visible, solid tumor liver cancer, among others, one might add another $500 million of headline value, increasing the range to $5 to $7 per share.

Systemic treatment value. This is the more lustrous brass ring. Again, making several initial assumptions, the share price range is $15 to $20, with other indications potentially adding another $5 to $10 per share.