Fortress Biotech: Highly Complicated, Significantly Undervalued

Posted by Thomas Shaw on December 11th, 2018

Summary
Fortress Biotech is a biopharmaceutical company devoted to acquiring, building and commercializing novel pharmaceutical and biotechnology products. Get more details about Fortress Biotech

Company assets include things like interests in ten biotech companies, 3 of that are publicly listed, a publicly listed, full-service investment bank, and also a special objective acquisition company ("SPAC").

Considering that five portfolio companies are publicly listed, we can calculate the value of its public portfolio, which in return allows us to calculate the market-implied worth in the private portfolio.

The private portfolio, having said that, seems to be undervalued offered the expectable market place capitalization of the IPO of subsidiary Caelum Biosciences.

I'd prefer to present you with my evaluation of a company that I've been intrigued by ever due to the fact it came up on one of my biotech stock screeners, because it is definitely in contrast to anything else you can uncover within the public biotech markets.

It's not one, but ten biotech companies bundled into one, with a incredibly broad pipeline of drugs, ranging from pre-clinical to late-stage. Additionally, it involves interests inside a full-service investment bank as well as a specific objective acquisition company ("SPAC"). Though a majority of its subsidiaries are nevertheless private and offer restricted financial info, we can simply assess the worth of its public portfolio, and use it to create an estimate of your private portfolio's value. To the benefit of an investor, the company does not only supply catalysts by means of its pipeline, but in addition by way of the planned initial public providing of a subsidiary inside the next months. This highly intriguing company is known as Fortress Biotech (NASDAQ:FBIO).

Company Description and History
Fortress Biotech, in its own words, is actually a "biopharmaceutical company dedicated to acquiring, establishing and commercializing novel pharmaceutical and biotechnology products."

Fortress Biotech's story initially started in 2006 when the company was nevertheless named Coronado Biosciences. It was in stealth mode until 2011, when it announced that it had raised practically USD 50mn. in two separate funding rounds. The company shortly after announced that it would go public by registering its private shares as widespread stock. Most interestingly, in the time, Coronado's key solution was a drug derived from a parasite found in pigs, with trials for any variety of indications which includes Crohn's illness and autism. Nonetheless, the trial for Crohn's illness was discontinued soon after review from an independent advisory committee, and the study investigating the effect of the drug in adults with Autism Spectrum Disorder also failed to attain statistic significance.