Spectral Medical Inc T.EDT

Alternate Symbol(s): EDTXF

Spectral Medical Inc. is a Canada-based late-stage theragnostic company advancing therapeutic options for sepsis and septic shock. The Company develops and commercializes a treatment for septic shock utilizing its Endotoxin Activity Assay (EAA) diagnostic and the Toraymyxin therapeutic (PMX). PMX is a therapeutic hemoperfusion device that removes endotoxin, which can cause sepsis, from the bloodstream and is guided by the Company’s EAA. PMX is approved for therapeutic use in Japan and Europe and has been used safely and effectively on more than 340,000 patients to date. It has pioneered the development of biochemical markers for the clinical syndrome known as septic shock. It is continuing its legacy business of manufacturing and selling certain proprietary reagents. It develops, produces and markets recombinant proteins, antibodies and calibrators. These materials are sold for use in research and development, as well as in products manufactured by other diagnostic companies.

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Spectral Medical Inc > Spectral on Linkedin Today

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Comment by gebremeskelon Nov 30, 2024 6:11pm

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Post# 36339215

RE:RE:RE:RE:RE:RE:RE:Spectral on Linkedin Today

Thanks for that MM. I'm hoping the final number will be higher than $5 CAD. The link you provided has -

"In Q4 2023 the median EV/Revenue Multiple for BioTech & Genomics companies was 5.7x, after hitting a 5x low in Q3."

It took some doing, but I found another website that provides a much higher multiple:

"In 2023, the median EV to revenue multiple for biotechnology companies sat at 12.97x."

https://exitwise.com/blog/biotech-valuation

If I split the difference and say 9x

$2B X 9 = $18B USD

If 10% of market potential seems low I'll use 15% = $2.7B

Divided by 312m fully diluted shares outstanding (according to the latest MD&A)

= $8.65 USD
or about $12.11 CAD

( If I use the12.97 multiple I end up with $17.46 CAD )

I"m new at this and have probably come up with an unrealistically high number. If so please point out where I have gone off track.

mercedesman wrote:
Much higher, but only if you believe that standard Biotech revenue and EBITDA multiples come into play when trying to put a fair valuation on Spectral

Here's a relevant site :

https://finerva.com/report/biotech-genomics-2024-valuation-multiples/

"BioTech companies are regularly acquired at multi-billion valuations even before they make their first revenues."

They say 5.7X as a revenue multiple is the 2022 going rate - down from 10X in 2020 and 2021

What does Spectral say is the market potential ( for the USA only)? More than $2B ! Using the paltry 5.7X multiple it implies a gross valuation ( full USA only penetration ) of a mere $11.4B USD

Doing the math, you'll need to take into account a discount to account for a period of time for medical uptake, time value of money and of course, about 400 million shares o/s

Lets assume only 10% of the potential is achieved = $1.14B
Divided by 400m shares

= $2.85 USD
or about $4 CAD

10% seems low to me - for a new SoC , that excludes Canadian revenues and of course,worldwide sales of EAA

So ya, your $5 calc seems fair ( conservative....but fair)

Gets even better if you use common EBITDA multiples.

MM