Telik Inc (NASDAQ:TELK)
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A biopharmaceutical company working to discover, develop and commercialize innovative small molecule drugs to treat diseases.
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A biopharmaceutical company working to discover, develop and commercialize innovative small molecule drugs to treat diseases.
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Fool UK
Recs
huge investment must have results
Ouch, down side potential estimated at $3 because of results, which is still generous imho. With excellent results this company was only worth a max of $6-7. The market that it is doing its drug research for is relatively small, also mho.
This is why I rated it as underperform regardless of results.
Market cap 1 billion @ the $20ish price.
The drug telcyta is for non-small cell lung cancer, yet thanks to changes in smoking patterns, ie lower tar cigarettes, more the lung cancer is small cell and give that over 90% of lung cancer is from smoking, well, I'm not sure how big the market for this drug would be. Currently 80% of 175,000 new cases of lung cancer are non-small cell, but I suspect that percentage will decline because of those changes in smoking patterns. Some of these 175,000 cases are also secondary cancers.
Ovarian cancer, 20,000 - new cases per year.
It looks to me that between their two drugs they have a market potential of 120,000 new patients per year and well, that about 8,000 of share capital per new case per year. That just seems extremely steep for product that isn't even approved yet. And what business gets 100% of market share?