Research On The Appraisal Of Biomedical Enterprises Based On Modified Pipeline-rNPV Model

In the early stage,high manpower cost,material and financial resources need to be invested into research and development of new drug.And it takes a long time and there is great uncertainty in the successful commercial launch.The traditional evaluation approaches and methods are often difficult to meet the needs of reasonable valuation of innovative drug enterprises.This paper aims to achieve the goal of scientific,objective and reasonable evaluation of innovative drug enterprise value by revising and improving relevant enterprise value evaluation methods,and then create favorable conditions for innovative drug enterprise listing,financing,merger and reorganization,etc.First of all,based on the literature review of the theory and methods of enterprise value evaluation and the analysis of the current situation of the industry,it is found that biomedical enterprises in the present stage show the characteristics of high investment,high technology,high risk,high profit and long cycle.Secondly,according to the production and operation conditions of biomedical enterprises as well as their own particularity,the idea of Pipeline division and classified evaluation was put forward,and the biomedical enterprises were divided into pipelines during the marketing period and pipelines during the research and development period.According to the characteristics of different pipelines,different evaluation methods were adopted,namely Pipeline-rNPV evaluation model.Thirdly,the nature of real options in biomedical enterprises is mainly reflected in pipelines during research and listing.Therefore,the binomial tree was adopted to modify the Pipeline-rNPV evaluation model,so as to better fit the objective reality of the enterprise value evaluation of biomedical enterprises.Finally,taking Amoytop Biotech as an example,the improved Pipeline-rNPV model is used to evaluate its enterprise value.In the evaluation process,based on the operating income over the years,the ratio of cost and expense to operating income was calculated and the parameters of the FCFF model were determined.Then the binary tree model is used to reasonably predict the free cash flow of the enterprise,and finally the pipeline value of the listing period without real options is inverted.Then,the risk-adjusted net present value(rNPV)method was adopted to evaluate the key R&D pipelines of Amoytop Biotech,and the risk adjustment was carried out on the pipeline value during the R&D of Amoytop Biotech through the inverse binary tree algorithm.By summarizing the pipeline value during the listing period and during the research period,we can obtain the enterprise value of Amoytop Biotech on December31,2021.Compared with the performance of the company’s stock in the stock market,the conclusion of enterprise value evaluation calculated by the improved Pipeline-rNPV model is scientific and reasonable.The innovation of this thesis mainly lays on the following two aspects: first is method innovation.As a member of the high-tech enterprise,the biological pharmaceutical enterprise’s characteristics determine that its enterprise value evaluation should be divided into pipelines and classified evaluation according to the new drug research stage,and a Pipeline-rNPV model based on enterprise free cash flow is established.A new drug on the market can be estimated based on its stable cash flow,while for a new drug in the development stage,its valuation should be determined according to the progress and risk of clinical trials.The binomial tree was used to modify the Pipeline-rNPV model to fully consider the success rate of new drugs and other factors.The second is the innovation of the research content,that is,focusing on the biomedical industry,choosing Amoytop Biotech as the appraisal object to enrich the existing case resources for the appraisal of biomedical enterprises.On the basis of fully considering the success rate of new drugs,the binary tree was used to modify the Pipeline-rNPV model.In short,this study enriches the theory and method of enterprise value assessment,and the research results have certain theoretical and application value for the evaluation of innovative pharmaceutical enterprise value.