Challenge
A clinical stage immuno-oncology biotech company spun out from a leading university had completed a Phase I clinical trial in ovarian cancer patients with its lead antibody. In response to a request from a potential pharma licensor, the biotech needed to build a model of projected sales for the antibody. Rather than just a revenue forecast, a full valuation model was needed to provide a firmer underpinning for the licensing discussions.
Solution
Alacrita engaged a pharmaceutical oncologist with ovarian cancer expertise to build input assumptions for the model, of which a key factor was to determine the appropriate patient populations for treatment with the antibody, positioning of drug in each of these populations e.g. first-line vs. second-line treatment, as well as top level estimates for the clinical trials required for approval in each. We presented our findings to the CEO of the biotech and agreed upon three specific patient populations to initially target with the drug, followed by two additional ‘maintenance’ populations that may benefit from treatment with the antibody based on its proposed positioning.
Combining this information with benchmarks for other commercial and development assumptions in oncology, we used our established Monte Carlo rNPV model to develop a valuation range for the antibody in the five different patient populations, quantifying the total opportunity for the drug. Alacrita modeled a low, base and high case for almost every single input assumption to account for inherent uncertainties characteristic of an early clinical stage asset.
Valuations
Our expertise in performing business and asset valuations covers a wide range of technology types including small molecules, biologics and cell and gene therapies. Valuations have been a staple of our practice since our inception in 2009.
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