You can find my simple model for your use below: licensing-deal-model_ Drawing on past licensing deals in the biotech space, one can see a major shift in licensing deals strategy. Big pharma is placing large bets on early-stage assets that could potentially provide pharma with long-term growth. A major challenge that licensors and licensees face…… Continue reading A Simple Licensing Deal Model for your Biotech Start-Up
Modern Portfolio Theory: Does it Work for Biotech?
Modern Portfolio Theory suggests that every portfolio has its risk and its corresponding rate of return. Markowitz (1952) showed that there is no “best investment” but rather a “best” trade-off between risk and return, called efficient frontier theory. This theory is based on a critical assumption: the risk and return profile of an asset or portfolio when constructed,…… Continue reading Modern Portfolio Theory: Does it Work for Biotech?
Winners and Losers in Pharma / Biotech Mergers and Acquisitions: Biogen Shines Again
Pharma / Biotech is one of the most M&A intensive industries. Over a period of approximately 20 years, the industry has spent over USD 1.4 trillion in pharma / biotech acquisitions (excl. generics, OTC, Animal Health, CROs and CMOs acquisitions). The aim of this analysis is to assess which of the acquirers have really gained from…… Continue reading Winners and Losers in Pharma / Biotech Mergers and Acquisitions: Biogen Shines Again
Brand Valuation of OTC Pharmaceutical Businesses
Brand valuation is a major part of business valuation in certain industries such as food & beverage and consumer home products. For example, Coca-Cola’s brand value is estimated at USD 73 bn. (see here), accounting for 40% of Coca-Cola’s current market capitalization. But how does brand valuation apply in the context of pharmaceuticals? In theory, a…… Continue reading Brand Valuation of OTC Pharmaceutical Businesses
A Simple VC Investment Model: What Every Biotech Entrepreneur Should Know (Revised)
In my previous post (see here) I developed a static financial model that incorporated all the necessary parameters to evaluate the potential investment return gain for entrepreneurs and VCs after a successful exit (through M&A). The model incorporated what VCs usually ask from entrepreneurs: a percentage of the firm’s equity in the form of convertible preferred stock,…… Continue reading A Simple VC Investment Model: What Every Biotech Entrepreneur Should Know (Revised)
Sales Forecasting in the Pharmaceutical Industry
One of the main challenges Sales & Marketing teams face is how to forecast the revenue of new products. There exist two principal strategies to estimate the sales of new products hitting the market: Primary research: communicating to KOLs and physicians how a new medicine can add value to patients and its potential side effects. Hence, based…… Continue reading Sales Forecasting in the Pharmaceutical Industry
10 Things I learned from “Shark Tank”
“Shark Tank” is one of my favourite TV Shows. Not only because it is related to the early-stage investment field that is the main driver of major economies but also because it is fun to watch. The way that all interesting (or not) ideas are presented and pitched to high-net worth investors stimulates your mind and makes you…… Continue reading 10 Things I learned from “Shark Tank”
Venture Financing Trends in Biotech: A Decade of Healthy Investment Returns
Biotech stocks have demonstrated enormous growth during the past few years (see: The U.S. Small and Mid-Cap Biotech Shines: Stocks on the Rise). The average stock return for biotechs was found to be over 40%, depending on the date of reference during the post-IPO period (see: Post-IPO performance of U.S. Biotechnology Companies). Biotech firms can generate huge stock…… Continue reading Venture Financing Trends in Biotech: A Decade of Healthy Investment Returns
Do Scientists accept Management Processes?
Scientists’ acceptance or rejection of management processes has been historically a controversial issue not only at a corporate level but also at a research level. The method used by a researcher reveals the underlying theory associated with this method and determines to a certain extent the results obtained and hence, their interpretation. In order to frame…… Continue reading Do Scientists accept Management Processes?
Structuring and Developing an Effective Business Plan
Developing a Business Plan (BP) is a very frequent action when companies expect a shift in their strategic direction or desire to have a clearer path in the future. The hardest part in developing a BP is to form a realistic plan in terms of expectations. In addition, a BP shall be understandable and easy to explain to both internal and external stakeholders…… Continue reading Structuring and Developing an Effective Business Plan
A Primer on Determining the Appropriate Type of Investor for your Company
Investments are the principal growth driver of our global economy. The motive behind every investment shapes the investment deal structure and therefore plays a significant role on the outcome of every investment. This article highlights the main differences between strategic and financial buyers. Buyers can be classified as investment and corporate buyers. There exist general…… Continue reading A Primer on Determining the Appropriate Type of Investor for your Company
Common Mistakes in Valuation (Discounted Cash Flow)
Financial Modelling is both an art and science as it is not only based on Corporate Finance Theory but also on the ability of the Analyst to put theory in practice. This articles describes some common mistakes in Discounted Cash Flow (DCF) valuation, the principal method for valuing a business. Suggestions have been made to deal with these errors…… Continue reading Common Mistakes in Valuation (Discounted Cash Flow)
Biostrategy Analytics 