I am hoping someone can explain a bull or bear case for Roivant Sciences. Clearly this is difficult. According to Reuters, the most recent annual revenue was 8.3 mil, down from 32.7 mil 2 years ago.
It appears their stock runup, which has taken the company to about 6 times book and price to sales of over 3,000 appears to be centered around a highly likely to succeed trial of a medicine treating dermatomyositis.
Sounds good, but the condition itself is very uncommon to rare. Prevalance 2 to 20 per 100,000 (those who already have the condition), and 1 in 15 million incidence (new cases). USA is not the world, but in USA with 350 mil ppl that's say 23 people per year newly diagnosed, with an existing population with the condition (350e6 x \[2 to 20\]/100e3\] = 7000 to 70,000.
Population of wealthier nations is around 1.2 billion people (affording this type of med).
That would bring the treatable population to (1.2e9 / 350e6)\[7e3 to 70e3\] = 24,000 to 240,000 with 79 new people diagnosed annually.
Not many customers, but what is an example of another condition that also impacted fewer than 100,000 people? How much revenue did they make?
This info gathering is just AI by the way.
Soliris (eculizumab), developed by Alexion Pharmaceuticals had under 100,000 people and made revenues of $3.0 to 3.8 bil in a year. Over $500,000 per patient per year is/was paid. Sounds good, but ...
Back to Roivant, dermatomyositis is also treated to a degree (that I am not qualified to describe) by common prednisone. So will brepocitinib so displace prednisone to obtain a high return per patient? **I guess that's the question.**
paroxysmal nocturnal hemoglobinuria (PNH) and atypical hemolytic-uremic syndrome (aHUS) was a focus of the Alexion Pharmaceuticals drug
AI again - Historically, PNH had a 5-year mortality rate of 35% to 65% prior to targeted therapy. Untreated aHUS carries an acute mortality rate of up to 25%, with over 50% of adults progressing to end-stage kidney failure within one year.
Dermatomyositis that Roivant is addressing also has a mortality rate, but around 5 to 10%. Not comparable.