A privately-funded preclinical stage biotech company asked Alacrita for a valuation of their lead pipeline agent for use in discussions with VC investors regarding their next financing round. The product, a proprietary microRNA drug was being developed for Type 2 diabetes in the US.
Alacrita assembled a project team that included a drug development MD with extensive CV/Metabolic clinical trials experience, and a commercial strategy consultant who has worked on diabetes drugs. We started the valuation by defining a Target Product Profile to describe the assumed drug at launch, including its positioning and target patients based upon the mechanism and potential differentiation from currently available therapies. Using relevant benchmarks and market data, we then generated a set of assumptions for the costs, risks (PoS) and time to deliver the TPP to market, and for a sales forecast and cost of sales. We added assumptions for a post-launch outcomes trial, which has become a required investment for Type 2 diaetes drugs in US, to ensure sustained market access and uptake. This information was fed into Alacrita's bespoke rNPV valuation model which utilizes Monte Carlo simulation to calculate the impact of sensitivities in assumptions. The client was presented with the value analysis and a full set of assumptions and references, which they are using to enage with investors.
As a multi-disciplinary firm, in addition to valuations, Alacrita’s expertise in product development, strategy, and commercialization, allows us to draw on important insights that other valuation firms may not have. Understanding the key value inflection points for a pipeline asset and defining an overall value for a technology or business is vital, especially in transaction negotiations and commercial strategy, and few valuation firms are as well-placed as we are to do so.