van sharescene, leuk stukje om te lezen:
Is the following a prank or real? Allegedly from Florian Homm (the Ghost of CUV financier past) on the Google group.
--------------------------
Dear Uhohinc,
your research is amazingly in depth. You even quoted my book, Rogue Financier. That is thorough stuff.. I am leaving this little post with you. On November 5th I will hold a speech at a University in Erding, Bavaria, north of Munich before a few hundred students and about a dozen people from the media. Clinuvel will feature quite prominently in this speech as the investment, providing me with great emotional gratification especially after the EMA approval. I was fortunate to finance this company. Quite frankly, our funding prevented this jewel from going bust and we actively searched the market for credible, science oriented management. I leave this little commentary with you to make available to others on share scene and other boards. I have followed Clinuvel very closely for years even during my 15 months in prison fighting extradition to America. I will touch on a few issues (not just these very narrow financial concerns) that may be of interest to you and others:
Valuation:
In the absence of serious research the shares are absurdly misplaced. During my illustrious career I received numerous investment awards (european hedge fund manager of the year, top us specialty fund manager, number one germany fund, European pension fund, blah blah blah). I have written over 500 research reports for the likes of Fidelity, Merrill Lynch, tweedy Browne, VMR AG, ACMH Group etc etc... I have a reasonable idea of this business. Here we go:
Revenues of USD 40 to 70 Million for EPP is realistic. But get to the pretax or net profit figures! On EPP alone, Clinuvel may trade at only 5 times 2016 or 2017 earnings. I have not the slightest doubt that EPP alone is worth AUD 5-7 per share right now. You have to look at Vitiligo separately! This a sum of the parts evaluation. I was the original proponent to encourage CUV to consider Vitiligo, but Dr. Wolgen took it the critical step further: not as a stand-alone treatment but as a combination therapy. Here are some facts which will blow your mind: there are no less than 1.2 million vitiligo treatments per year. Some world class sources say the number may be between 1.5 and 1.8 Million. I love using lowish numbers in my models. If the low balling works and I do not have to twist the math - so much the better. It is utterly realistic that CUV may get USD 5K to 7K per vitiligo treatment. It is increasingly evident, that the combination therapy is so much more effective it will over a few years largely wipe out the traditional treatments. I would be very surprised if CUV does not reach abut half of the market in annual vitiligo treatments, certainly no less than 500,000 treatments a year as the market will quickly learn about CUV's vastly superior product. USD 3.5 Billion in sales. What do you thing the bit margins are on this product? It is not unrealistic that CUV generates USD 1 Billion or more in net profit by 2018/2019. Some of the things you say make serious sense as well. How about off-label use for extreme vitiligo cases? Or how about the hundreds of thousands who get skin cancer after organ transplants. Would CUV work there. Worth a try certainly. Always better than the risk of malignant, at times deadly skin cancer. Or how about those extreme Fitzgerald 1 types ultra prone to get skin cancer even with only modest sun exposure. What is beautiful about the modeling now is that with EMA approval and 95 percent likelihood of FDA approval the shares have basically done nothing. There is not a single first rate research report on CUV! That is incredible and difficult to fathom. It is also a once in a lifetime investment opportunity. Do not get lost in all the blah-bla micro details in these posts. Buy, put away and then cash out of your ten, twenty, thirty or forty bagger. Yes, that is possible and probable. There is no chance this undervaluation persists for more than 6 to 12 months. None. Vitiligo is progressing quite quickly, quarterly EPP profit figures will show exponential growth and patient numbers in the US and Europe may even surprise on the upside. For a proper valuation you need to strip out all R&D, OH and simply take COGS and Marketing/Sales. Vitiligo, the same but get ready for USD 50 Million to get to full FDA approval. If I use 50 million shares outstanding (conservative) CUV is worth 12 to 15 AUD per share at this very moment. 300 for EPP and 450 for Vitiligo. In an organized auction process, CUV would easily get USD 10 per share. Cash!
Threats:
There are three: A takeover. CUV, at this price is a sitting duck. It needs to be on NASDAQ asap. Top senior management (mostly Dr. Wolgen) needs to stay for at least the next 5 years and he needs to upgrade his team for a rather demanding Vitiligo approval process. Unless you have been in this space for a few decades (I have) you do not appreciate obtaining regulatory approval for a treatment which simply does not fit into the classical approval methodology (placebo or double blind design was absolutely not possible). The Scenesse approval by the EMA was the first ever, which integrated patient/doctor groups in the decision making process. That is a monumental achievement. The product pricing is amazingly good and much better than I ever imagined when I got involved about a decade ago. I see shareholders moaning about compensation levels. That is beyond absurd. This company is already global, operating in Europe, Australia, Singapore and the US. Compared to those companies compensation levels are well below average and what I view as a serious risk - management only has a tiny stake in this company. Their interest are not properly aligned with shareholders. It is always the same risk. A well payed manager may sell out a company well below price if his personal stake is small. He may opt for a fat golden parachute instead. CUV top management owns about 4 percent of the company. Get real. 10 percent, some for EPP and milestones like NASDAQ and the mother of all approvals vitiligo. This is a serious risk. Of course an opportunistic takeover at AUD 7, 10, 20 or even 30 is another heavy risk. You are sitting on a potentially huge gold mine and someone literally steals it from under you. The third serious risk is execution. Dr. Wolgen is key and few very focused members of senior management. Retain, retain, retain and motivate. So simple. Upgrade that board and senior management for NSDAQ because this is no longer the Queensland Cup. There are so many clowns running around (an Australian dentist (madman on share scene), Retrophin under Shkreli, some suspect, "concert party" hedge funds) who have no idea what has been achieved and what remains to be done. This stuff is micro-management, persistence requiring the highest possible degree of credibility and operational focus. Regulators hate disruptions. Management disruptions, and all too frequent board shuffles are toxic and at best delay regulatory procedures. At worst they can derail them entirely. I have hired and fired hundreds of senior executives. Those wannabe entrepreneurs offer nothing but populistic generic hogwash. Madman has a sharp mind, but stick to the research Mr. Jones. I like what I read from you and Poontz as well, but get the big picture....grasp the complexity.