Telix Pharmaceuticals Limited

ASX:TLX

Telix Pharmaceuticals Limited

ASX:TLX
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$14.81 (+1.7%)
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#20
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40
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Pinned straw:

Straw deleted
mikebrisy
Added one year ago

@Remorhaz thanks for posting the summary.

I know I am not thinking about this one in the "right" way, but with my base valuation of $22/share for the 3-product diagnostic business, this is precisely where UBS has got to for Precision Medicine. (Just goes to show, two people can be precisely wrong in the same way!)

With TLX591 valued at $6/share, they are only ascribing $2 to the rest of therapeutics and $1 to TMS. It is interesting to see that breakdown, as it one level of further sophistication than I had.

Did UBS provide further detail on the assumptions that got them to $6 for TLX591? Assuming it is risked, then a positive readout of ProstACT GLOBAL in H1 2025 (that CY 2025) would be a big SP catalyst (>$10+). I wonder what risking they are carrying for it? I haven't gotten far enough into the clinical details to have my own view.

It is also interesting to note that they have upped the ultimate potential of Zircaix to $1bn sales + $1.5bn upside sales. My numbers for Zircaix get to $0.91m by 2030, which also assumes wide application beyond kidney cancer. For these I've just used the JD Cowan profile, that has Zircaix continuing to grow to reach $1.5bn by 2035, so it sounds as if UBS are even more bullish on that prodict.

My cunning plan, is to build my position based on the likely more modest SP impact of positive newsflow around Zircaix BLA later this year, as well as Pixclara getting to NDA submission. The idea is then to be positioned for the riskier "upside" of the therapeutics, knowing that there is a robust business in place for the diagnostics as well as an increasingly material radiopharmacy manufactucting/distribution business.

Still a huge amount to learn here, but given MY biggest risk is my lack of knowledge, I've happy to hold a modest RL position.

Disc: Held RL (2.9%) and SM

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Aaronfzr
Added one year ago

Im bullish too, but for the risk profile I do feel its relatively expensive @ 140 PE.

Its trading like a growth stock, and while it IS a functional business there is a lot of risk being discounted into those growth assumptions.

#iwanttobelieve

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Remorhaz
Added one year ago

@mikebrisy I'm not sure this is exactly what you're looking for but this from a quick search - obviously take this with whatever grains of salt are required ...

TLX591: Clearly identifiable use case

We previously set our peak sales forecast for TLX591 in prostate cancer at AUD1.4b following the disclosure of data from the phase I ProstACT SELECT trial. These pointed towards an asset that we think is approvable (so no risk adjustment) and we used a placeholder 25% of incumbent Pluvicto's (Novartis) consensus sales peak sales at the time.

This approach is (clearly) somewhat flawed since it is not derived from a view of the total market (which would be difficult based on the potentially multiple lines 591 could be used in and is why we do not do it), but on a moving benchmark that happened to be a certain size on the day we made the forecast. We are sticking with AUD1.4b for now, pending data from the phase III ProstACT GLOBAL trial in 2025 that could allow a more detailed approach.

Upside: AUD840m

The phase III VISION trial for Pluvicto included around 40% of patients with renal insufficiency, which means that 591 is potentially a better choice than Pluvicto, since 591 is cleared via the liver instead of the kidneys. Changing our peak sales to 40% of Pluvicto's consensus sales would add AUD840m to our forecast.

UBS view on what to watch:

  • Interim futility analysis for ProstACT GLOBAL, we assume in 1Q/2Q 2025
  • Interim efficacy data in mid 2025, subject to ongoing discussions with FDA
  • Any other information disclosed, given the focus on this asset


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mikebrisy
Added one year ago

@Remorhaz thanks! That's exactly what I was looking for.

"No risk adjustment" ... that's very aggressive at this stage. However, 25% of Pluvicto sales is not unreasonable. However, to assume that with zero risking pre-approval well, as they say themselves .... "The approach is (clearly) somewhat flawed ..."

I'm not sure that just because everything is moving so quickly in this space justifies these loose assumptions, however, no single assumption can be well-founded in this case. So you have to go into this considering a wide range of potential scenarios.... from zero to very big. In that context, 25% of pluvicto is probably not a totally unreasonable "central case". As long as you understand the risk around it.

The idea of a "price target" is highly flawed. Particularly for investors who might not be prepared or able to understand the very wide range of outcomes around it.

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