Neuer SGLT-2-Inhibitor

lscfa wrote: First Berlin report is too conservative.

- It calculates current market size of the skin lightening market at $8 billion and growing at 2%/yr.
But current market size is $13 billion and growing 15%/yr to $20 billion by 2018. (Deadlock
report and other sources)

- It assumes royalties start on the anti-diabetes IP in 8 years

- It assumes a 25% discount rate for both the skin lightening royalties (1 year away) and the antidiabetes royalties (8 years away)

- No value given for SBM's anti-aging IP ($200 billion market)


The skin lightening product makes up $0.52 of the $0.91 target price ($96 mil PV / 186.3 mil shs.)

If starting market size is adjusted to $13 billion from $8 billion and discount rate is lowered to 15% the PV increases to $1.53 => Target price = $1.92


Mkt Size 6% Mkt Sh. 5% Royalty PV @ 25%
     
7,458 447 22 18
7,607 456 23 15
7,759 466 23 12
7,914 475 24 10
8,073 484 24 8
8,234 494 25 6
8,399 504 25 5
8,567 514 26 4
8,738 524 26 4
8,913 535 27 3
9,091 545 27 2
9,273 556 28 2
9,459 568 28 2
9,648 579 29 1
9,841 590 30 1
10,037 602 30 1
10,238 614 31 1
10,443 627 31 1
10,652 639 32 0
10,865 652 33 0
11,082 665 33 0
11,304 678 34 0
11,530 692 35 0
11,761 706 35 0
11,996 720 36 0
     
    PV Total = 97
    Per Share 0.52

Mkt Size 6% Mkt Sh. 5% Royalty PV @ 15%
     
13,000 780 39 34
13,260 796 40 30
13,525 812 41 27
13,796 828 41 24
14,072 844 42 21
14,353 861 43 19