Company: OSRH
Filing Date: 2025-01-24
Form Type: S-4/A
Source: 0001213900-25-006139
Chunk: 291

Company: OSR Holdings, Inc.
Filing Date: 2025-01-24
Form: S-4/A
Chunk 291
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 patient group of 15. While the size of patient group of n=15 is too small to indicate the trial’s results in any statistically meaningful way, the clinical study report prepared by Dt&CRO Co., Ltd indicates that there was a 75% (bone fusion) success rate for the test group while the success rate for the control group was 28.57% with no signs of severe adverse effects observed from the 24 thweek post -operationsafety follow -upexaminations. However, the BLAC M&A Committee noted that the valuation report excluded DRT102 (with clinical data) from its valuation model because the DRT102 clinical trial was abandoned due to a lack of financial resources, leaving only DRT101, a preclinical asset, as the single source of cash flow projection. As mentioned above, the valuation model of Darnatein was built on projected cash flows solely from the company’s cartilage regenerative program (DRT101) over a long -termperiod of 30 years (2023 – 2052) with a total out -licensingvalue of USD 2.16 billion given the large addressable market (approximately $6.75 billion in 2020 estimated to reach $15.7 billion by 2030, according to Allied Markets Research 10) and no effective disease -modifyingOA drugs (DMOADs) approved by regulatory bodies so far 11. The projected period of 30 years is based on the patent -protectedperiod of 20 years 12which is followed by additional 10 years with scaling -downrevenues reflecting possible launches of generic competitors after the patent expiration. On the other hand, the report does not assume any “Terminal Value” which is normally built into the valuation model at the end of the projected cash flow period and often times occupies a significant portion of the entire valuation outcome, which means that a going concern was not assumed for the purposes of the valuation on Darnatein. The BLAC M&A Committee noted that the Darnatein valuation model includes an assumption that a $2+ billion licensing deal would be realized and that this assumption has not materialized. However, the BLAC M&A Committee also noted that, in the pre -clinicalbiotech space, rNPV analysis is oftentimes used as a basis for a licensor and a licensee to negotiate the licensing value of drug candidates; i.e. rNPV analysis is a common method used to determine the fair market value of a drug candidate even when