1992 Founded
2015 Qtr 3 Temasek bought 1,226,630 shares for about US$196M to US$227M
2018 Temasek divested
You are looking at the most expensive drug in the world. Soliris costs about US$500,000 for one year treatment. It is used in private clinics. It is a specialty drug for very rare disorders atypical hemolytic uremic syndrome (aHUS) and Paroxysmal nocturnal hemoglobinuria (PNH). Being a non-mass market drug, there is no big pharma competition. Thus Alexion can command unethical prices and earn high margins.
Soliris contributes 70% of Alexion's revenue. It came on the market in 2007 and has been generating good revenue. However, Alexion had to resort to questionable marketing strategies to get governments to use the drug due to its cost. There have been investigations and police action in a few countries. It recently paid US$21.5M fines to settle with US regulators over bribery suits.
With the introduction of Solaris in 2007, Alexion's fnancials improved and stock price moved up tremendously, peaking in 2015. It has been under-performing the market since then. Temasek purchased 1,226,630 shares in 2015 Q2 when prices were between US$185 and US$160. The investment is estimated between US$196M to US$227M.
These are the info known at the time:
- Soliris is the company's primary product.
- Company revenue is rising, Soliris provides high margins.
- Alexion had good profits but never declared dividends (to this day).
- In May 2015, Alexion had just acquired listed Synageva BioPharma Inc in a US$8.4B share and cash deal. The market felt the acquisition was overpriced at 130% premium.
- Patent for Soliris will expire in 2021.
Given the info, it is difficult to see the rationale for Temasek's long term investment in Alexion. Temasek divested 50% of the stocks in Q2 of 2018 with prices between US$118 to US$139. Balance 50% were sold in Q3 of 2018 at prices between US$97 and US1$139.
The losses over 3 years is estimated between US$25M to US$94M. Money burnt for a meaningless investment.
2015 Qtr 3 Temasek bought 1,226,630 shares for about US$196M to US$227M
2018 Temasek divested
You are looking at the most expensive drug in the world. Soliris costs about US$500,000 for one year treatment. It is used in private clinics. It is a specialty drug for very rare disorders atypical hemolytic uremic syndrome (aHUS) and Paroxysmal nocturnal hemoglobinuria (PNH). Being a non-mass market drug, there is no big pharma competition. Thus Alexion can command unethical prices and earn high margins.
Soliris contributes 70% of Alexion's revenue. It came on the market in 2007 and has been generating good revenue. However, Alexion had to resort to questionable marketing strategies to get governments to use the drug due to its cost. There have been investigations and police action in a few countries. It recently paid US$21.5M fines to settle with US regulators over bribery suits.
With the introduction of Solaris in 2007, Alexion's fnancials improved and stock price moved up tremendously, peaking in 2015. It has been under-performing the market since then. Temasek purchased 1,226,630 shares in 2015 Q2 when prices were between US$185 and US$160. The investment is estimated between US$196M to US$227M.
These are the info known at the time:
- Soliris is the company's primary product.
- Company revenue is rising, Soliris provides high margins.
- Alexion had good profits but never declared dividends (to this day).
- In May 2015, Alexion had just acquired listed Synageva BioPharma Inc in a US$8.4B share and cash deal. The market felt the acquisition was overpriced at 130% premium.
- Patent for Soliris will expire in 2021.
Given the info, it is difficult to see the rationale for Temasek's long term investment in Alexion. Temasek divested 50% of the stocks in Q2 of 2018 with prices between US$118 to US$139. Balance 50% were sold in Q3 of 2018 at prices between US$97 and US1$139.
The losses over 3 years is estimated between US$25M to US$94M. Money burnt for a meaningless investment.
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