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ADXS @26: Minimum BO Price

This a first in a series to stimulate discussion about ADXS BO price. 

First let's look at the market for ADXS first platform,( HPV related cancers. (Note: there are four total platforms, so we're only considering a quarter of their total IP here). 

1. How many people are we talking about? 
39,844 new HPV associated cancers are diagnosed every year, according to the CDC. 

2. Market share assumption 
now assume that (low end) 10% of these cases are treated with ADXS LM related therapy, that comes to 3,984 cases per year IN THE US. So, if you assume a cost of $50,000 per treatment, that comes to about $200m in the US. now consider 
3.  Now add in Europe and Japan 

  • Europe  has a total Population of 508m people;  and 
  • Japan with a population of 127 people,
Using the "prevalence" (new cases) figure of 12.5 per 100,000 (the basis for the CDC calculation), you get: 63,500 cases Europe, and 15,875 cases in Japan. 10% of these comes to 6530 and 1,588 respectively - for a total of 7,938 cases IN ADDITION TO the 3984 cases in the US. 
  • The additional amount for EUROPE AND JAPAN = 7,938 X $50,000 = $396,000,000 
4. Grand total is $600m

So, the TOTAL for US ($200m) plus Europe and Japan ($396m) is around $600m revenues per year, treating 10% of the total HPV related cancer population diagnosed IN ONE YEAR (and not counting those that are still being treated that were diagnosed in previous years). 

5. Magic wand reduction: Now a waive a magic wand to account for the fact there will be a substantial price discount in Europe, say 50%. That will reduce total annual revenue in US, EUROPE and JAPAN to around $437m (will give you spreadsheet later). 


Projected revenue for ONE FRANCHISE assuming 10% of treatable population is $437m. 


7. From Revenue to Market Cap: Expected Value based on probability of approval

Now assume a 50% probability the will be approved - to calculate the "expected value" of an event you just take

(Value of event) X (Probability of event) = Expected value

for HPV Platform that translates as follows

($437m) X (0.50) = $218m Annual Revenue
8. Moving to Price/Revenue estimate

Previously cited research suggests a P/R ratio of 6, which  suggests market cap is... 

$218m X 6 = $1.3b 

9. And finally to buy out PPS: Now take 49m fully diluted shares to get share price at BO, or 

$1.3b / 49m = 26 

PUNCH LINE: If you assume 50% likelihood of success for LM Therapy in HPV related cancers, and that 10% of the total ANNUAL patient population for a year (not including patients from previous years), you get a Buy out value of $26 FOR THIS ONE FRANCHISE - of FOUR. f


  1. This isn't about ADXS. Jess hit the nail on the head in his post which briefly summarized BRs years of negative comments about Ariad. Now that lying sack of shit claims to have retired on all the money he made on Ariad. For anyone who believes that I have a bridge in Brooklyn I want to sell you. For all the misery BR has caused over the years to other investors who sold their shares of Ariad because of him, I hope he is prepared for the inevitable karmic events he has brought on himself and his family which will equal the misery he has caused others which will happen sooner or later without doubt.

  2. We should have good news Friday. Whether or not it moves the sp is irrelevant. In terms of the eventual buyout amount, however, I fully expect the next indication(s) will add billions to that figure. The forces that have manipulated this sp to its current ridiculous low figure will not stop of course. But, realistically, the companies that are looking to acquire Aurinia will have to pay an increasingly larger amount for every month that passes between now and the approval. Personally I would like to see it happen in 2020 when the company has attained its highest value. Until then, as always, the best advice is to be smart and just continue to accumulate during the dips as the institutional investors do. That common sense advice made some of us a fortune on Ariad and it will happen here as well, rest assured.

  3. Hi guys, glad I found some of the old IHUB ARIAd crew ( which admittedly I pretty much just lurked on ).

    Have you guys seen the price action of ADXS lately? Down do lower 3's. Frankly, I'm not sure what to make of it other than manipulation. However, it seems like it could be more than that...maybe some bad news leaked?

    Any thoughts?


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iHub has been hijacked by trolls

Yup. iHub can't get rid of "Biotech Researcher," aka BR.  It's both a win for BR (the troll), and a huge loss for iHub. Their platform loses value and credibility when they refuse to take action on perma-trolls that derail the discussion and distract investors from their efforts to just honestly share information and opinions on the equities they own.

So shame on iHub for not taking action to resolve this.

I'm going to cease and desist on posting there until the troll (BR) problem has been resolved, and credible, valuable posters have been reinstated. I've already cancelled my premium membership some time ago. I suggest you do the same.

With kind regards to all

Trading Cyclist (aka TC)