Claritas Pharmaceuticals Inc V.CLAS.H

RE:RE:RE:RE: Patience is a key element of success.... B.Gates

[AngelaL]

The market valuation of any small biotech with an exciting asset that shows proof of concept in a pilot Phase 2 clinical trial for PAH, testing a novel proprietary technology that has a promising new mechanism of action (as R-107 does), would be in the range of US$400-700 million, possibly stretching to US$800 million if the results are spectacular. Such a prospective market valuation assumes that the intellectual property position is sound (this is in fact the case for R-107 since a search on the web shows the patents are issued globally and are also relatively young). The US$400-700 million market valuation also assumes that the side-effect profile of the drug in the upcoming Phase 1 study is benign and that the preclinical safety package is unremarkable (so far, all the PR's issued by the company reporting on formal animal safety studies have been ok). The value of R-107 for other indications, such as COVID-19, would be on top of the US$400-700 million figure and would depend in part on the results of the Phase 1 safety study. Assuming that is ok, we might see an additional $300-500 million step-up in market value. In short, if all goes well with the Phase 1 safety study plus the pilot Phase 2 PAH study it would not be atypical to see a market valuation north of US$1 billion. Presumably the company would by that point have uplisted onto a major biotech-friendly exchange such as the NASDAQ.