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Exclusive New Feature: MS Biotech Financial Health Score

Last Updated on September 17, 2019 by Sultan Beardsley

Hello there, MS Chief Pharmaceutical Officer Chris here. I am elated to share something we have been working diligently on: an objective score to help evaluate biotechnology company. As the first of several objective scores to be released, our new Financial Health Score is designed to specifically measure the financial health of developing biotechnology companies. As I looked around at other scoring systems or ranks, I was constantly confronted with the realization that these scores were not applicable to biotechnology. How and why should the same score be used to assess the financial health of developing mid-cap biotechnology companies as mega-cap technology companies? They should not! This is why we diligently created this proprietary measure of health. Our proprietary score incorporates important considerations for clinical stage biotechnology companies such as cash runway, debt, and current cash position, among other inputs relevant to developing biotechnology companies.

Our scale ranges from negative five up to a score of twenty-four. Interpretation is as follows:

  • Score of -5 to 5 [D]: The lowest tier on our financial score. These companies have a concerning financial situation which warrants careful evaluation of risks.
  • Score of 5.1 to 10 [C]: Companies in this tier have an average financial score. Companies are not expected to be as high risk as those with lower scores, but have characteristics that warrant careful evaluation.
  • Score of 10.2 to 15 [B]: These companies have very favorable financial scores. There is limited concern from a financial standpoint.
  • Score of 15.1 to 24 [A]: These companies are the cream of the crop from a financial standpoint based on our proprietary score. There is a strong financial set-up for these companies to develop their clinical assets.

Here is the MS Financial Score for several of our favorite biotechnology plays:

  • RegenXBio (RGNX): 17.9 [A]
  • Calithera (CALA): 13.3 [B]
  • Adma Biologics (ADMA): 7.5 [C]
  • TG Therapeutics (TGTX): 3.1 [D]

This is not a recommendation to buy or sell any security. Members of the MS team hold stock in the aforementioned stocks and reserve the right to buy or sell securities at anytime.

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