Oncology asset revenue royalty investment decision
A healthcare investment banking firm with a focus on revenue royalty streams, evaluating a potential investment in a recently launched treatment for ovarian cancer.
To understand perceptions of physicians globally at a time when ovarian cancer treatment was experiencing a significant change due to the launch of 3-5 commercially similar, yet medically ground-breaking products. To develop a ten-year revenue forecast projection to best inform the decision to bid or not bid, and if so, at what level.
We used our therapeutic area knowledge to guide qualitative and quantitative primary research with physicians, KOLs, and payers in the US and EU5 and to develop a flexible model that would allow for impact analysis of differing market dynamics in the major countries. We built a research-informed financial model that could account for significantly different payer dynamics in various countries.
Revenue projections were aligned with recent company quarterly earnings reports to better inform a potential bid level. Top-line revenue projections were calculated in 6 major markets and extrapolated to the rest of the world with a dynamic forecasting model that was capable of accounting for a shifting competitive landscape, rapid label expansions into earlier lines of treatment, use in different patient populations, and potential payer restrictions in the target markets. Overall revenue projections were lower than consensus Wall Street analyst reports but remarkably in-line with company reported sales.Download a pdf of this case study (example)
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