Challenge:

A clinical stage company developed two series of small molecules to treat Alzheimer Disease (AD) and other central nervous system (CNS) indications. Their lead asset aims for symptomatic relief of mild, moderate and severe Alzheimer’s disease (AD). The drug had a favorable safety and tolerability profile and demonstrated statistically significant improvement in both core symptoms of AD in placebo-controlled, double-blind, Phase 2 trials and is now Phase 3-ready. The client asked Alacrita to undertake an external, fully transparent and auditable valuation of the asset, focussing on the US and European opportunity for use in supporting partnering negotiations.

Solution:

Alacrita performed a Monte Carlo-based rNPV valuation focusing on the opportunities in the US and major European markets. The project was conducted as follows:

  1. We first reviewed and discussed relevant input assumptions provided by the client, in particular the top-line data from their completed preclinical and clinical studies, remaining clinical development plan and financial forecast for the lead asset, including timelines and costs.

  2. We developed projections for the addressable market, considering peak penetration, market share, drug pricing and product revenues in the major markets (US and EU5) in the target indication. We also developed projections for costs, timelines and probabilities of success at each go/no-go development/regulatory pivotal point.

  3. On completion of the project, Alacrita compiled the analyses and conclusions in a draft report in PowerPoint format. Upon the review of the draft report, Alacrita delivered a final report integrating any comments or feedback to ensure it met the client’s needs.
We concluded that competing drugs are unlikely to have a direct impact on the product given that some are high technical risk disease modifying therapies in early stages of development and others are simply symptom relieving therapies with no real differentiation from the well-established donepezil market.

 

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