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Executive Management Team
Frank Carlucci, Chairman
Harry Penner, Jr., Pres, CEO
Stephen Davis, Sr. VP, CFO, Treasurer, and Gen. Counsel
John Tallman, Ph.D., Exec. VP, Sec., Scientific Director, and Chairman
of the SAB
Alan Hutchinson, Ph.D., Sr. VP-Drug Discovery
Financial Overview
Market cap is about $600M. The 52 week range is $10 3/8 to $50,
the latter of which was reached on March 2. The P/E ratio is not
applicable because they lost $1.00 per share in 1999. This was in
line with analysts’ estimates. Losses per share are expected
to decrease in 2000, however, no profits are expected for at least a couple
years. This fact precludes me from rating this company a highest
rating. However, they still have about $32 million cash on hand.
In the last three months, the stock of Neurogen has been rather volatile
and upward moving due to strategic moves viewed favorably by analysts
(seebelow). In the last 6-7 weeks alone, the price has doubled.
In the last week however, it has lost about 15-20% of its value, but this
most likely is due to the biotech sector performing poorly overall.
Market Description/Business Model
Neurogen is strategically positioning itself very well in terms of alliances
with powerful biotech and pharma companies. It has several agreements
with Pfizer and collaborative relationship with American Home Products
and Schering-Plough. The agreements with Pfizer are proving to be
the most valuable. The run-up in the share price coincides with
Neurogen implementing drug discovery technology into Pfizer’s infrastructure.
For accomplishing the first phase of this collaboration, Pfizer paid Neurogen
$4 million of a total package worth $27 million.
Such collaborations are the most significant means of generating revenue
for Neurogen. This agreement with Pfizer is a non-exclusive licensing
agrement, and thus Neurogen is free to form other partnerships with other
companies, adding to their revenue.
The product pipeline is rather weak for what is considered a promising
biotech company. This is because the technology is viewed as its
strength, and the pipeline and products will eventually follow.
Currently, they have one Alzheimer’s related drug candidate about
to enter into Phase II trials following a favorable Phase I outcome.
Another drug for anxiety/depression indications is currently in Phase
I and reportedly performing well. Although this is the extent of their
clinical trial activity, they are active in many disease models: Alzheimer’s,
anxiety, depression, insomnia, obesity, diabetes, animal anxiety, and
inflammation. Their pipeline in these areas is likely to improve
due to their proprietary technology described below.
Science/Technology
The cornerstone of the Neurogen business is the AIDD technology.
Accelerated Intelligent Drug Discovery incorporates combinatorial chemistry,
high throughput screening, and advanced informatics to greatly increase
the speed at which drug leads can be generated and screened. This
technology has been licensed to Pfizer for $27 million dollars, and will
most likely be the basis of further profitable collaborations as well.
They have published 28 papers in peer reviewed journals.
Intellectual Property
Neurogen holds 109 patents, primarily pertaining to advances in neuroscience.
They can be found on the www.USPTO.gov web page and search for Neurogen.
Competitors
Collateral Therapeutics
Corvas International, Inc.
Cubist Pharmaceuticals
EntreMed, Inc.
Immunomedics, Inc.
La Jolla Pharmaceutical
Microcide Pharmaceuticals
XOMA Limited
Sources
www.finance.yahoo.com
cbs.marketwatch.com
company website
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