Post by qbeing1010 on Jul 17, 2016 8:40:34 GMT -5
Some selected posts from a thread yesterday on the old YMB, for those who may not be able to get there anymore:
DPC_DELIVERS: In case it hasn't occurred to some:
Alnylam has pressed on with their HBV program, despite Arrowhead's major lead, precisely because 1) they know the significance of what Arrowhead has demonstrated (i.e. HBV RNAi therapy is NOT a dead end) 2) even with Arrowhead's advantages, there is still a ton of money to be made in this area.
Arrowhead's end product, because of dpc, will be superior. But when Arrowhead achieves success with HBV RNAi therapy, it will generate some attention for Alnylam with their program.
HBV RNAi therapy will likely be the first RNAi therapy approved for human use. Alnylam does not want to be overlooked in all of the interest that generates.
HPARCH: You are absolutely correct, IMO.
The market for treatment is HUGE. There is NO single company that will be able to serve the entire market alone; there will likely be several drugs approved and distributed throughout the world through various partners, and they will all likely be RNAi based, however,, the safest and most preferred will be ARWR's DPC delivered ARC-520 (and, maybe even ARC-521), IMO.
I have provided my projections for sales and I will repost them now:
360m - 400m cHBV sufferers worldwide.
Say ARC-520 can treat only 5% of them (all patients, as implied by Dr. A in the recent Cantor presentation), over a period of 10 years: .05 x 400m = 20m patients. That leaves 350m+ patients left untreated.
What does that mean for ARWR in terms of share price?
20m patients treated / 10 years = 2m per year
Average treatment cost/year = $12,000 *(why? Because, using current interferon cost of $200/week in China, yielding $10,400/year as acceptable, I am escalating by 20% for premium costs, and I anticipate that this will be the average worldwide cost charged - in the US, it may be higher, and in other 3rd world countries, it might be much lower):
2m patients x $12,000 =24b/ year in revenues. What does that mean for a share price?
Well, biotechs trade at 10x revenues (or, if you prefer, 20 - 30 x profits) - that puts them at:
$24b/year x 10 = $2400b market cap. Yes, you read that right, IF they were to go it alone. Since its likely to partner up with big pharma, who will pay the remaining development costs and likely split the profits with ARWR, it will likely look something like this:
50% profit x $24b/year in sales (revenue), = $12b profit; split that between ARWR and their BP, so that leaves $6b/year profit for each.
ARWR, per above, will trade at 20 - 30x profit = say, 20, for now: 20 x $6b = $120b market cap ($2,000/share, at today's current shares outstanding).
Above is crazy outcome, but entirely reasonable, based on facts and data, at 5%. 
And, to connect my post with DPC's:
THAT is why ALNY is in the HBV market. The above is for only 5% penetration over 10 years. If only 30% of the worldwide HBV sufferers get treatment, then that is 120m patients seeking treatment - more than enough for other competitors to serve, even if their treatment is less tolerable, or more toxic, takes longer treatment periods for FC, or provides a lower FC rate.
My prediction is that initially, ARC-520 will raise the entire biotech tide, and then, the market will catch on and value only RNAi companies higher, and, then they REALLY will catch on, and realize that ARWR's "secret sauce" known as DPC is the real differentiator, and that's when the ALNY, IONS, DRNA and RGLS investors will flock to ARWR, because, it will always be the preferred RNAi therapy due to max efficacy, lowest AE rate, and highest overall patient tolerability, with quick concept to drug to clinical trials to approval for marketing/sales times.
The Cantor presentation clearly implied that ARC-520 is "crippling the life cycle" of the virus in orders of magnitude that has Dr. A confident enough to say so, publically, when, he KNOWS that saying anything like this will be subject to the highest scrutiny.
One more point for the weekend crowd to ponder:
"knocking the snot out of the virus", implies for single dose results, if the analogy to a boxer's "knockout punch" thrown in a boxing match is what he was thinking when he said it.
WYATTKAP: HP, IMO your numbers are conservative. This is why I feel we have not seen a deal yet. The data is so good, it would be a violation of our teams fiduciary duty to cut a deal at a time when massive data is telling them to see more that clearly could add billions more to the company in both milestones and royalty % retained. We just heard 521 is a backup!!!!! We just heard again we are kicking the snot out of 6 of 6 virus elements, we have funding into January and the upgrade pictures of the lab look on schedule to me!! The building pipeline is also very close to showing massive value!!! Enjoy your beautiful NY day with family and friends, I'm missing my family on this China trip!!! Raining every day here, humid, and sticky!! 2 more days and I fly back to the Paradise of N. Idaho for rest of summer.