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RNPV
In finance, rNPV ("risk-adjusted net present value") or eNPV ("expected NPV") is a method to value risky future cash flows. rNPV is the standard valuation method in the drug development industry, where sufficient data exists to estimate success rates for all R&D phases.Stewart JJ et alPutting a Price on Biotechnology Nature Biotechnology. 2001. 19:5 A similar technique is used in the probability model of credit default swap (CDS) valuation. rNPV modifies the standard NPV calculation of discounted cash flow (DCF) analysis by adjusting (multiplying) each cash flow by the estimated probability that it occurs (the estimated success rate). In the language of probability theory, the rNPV is the expected value. Note that this in contrast to the more general valuation approach, where risk is instead incorporated by adding a risk premium percentage to the discount rate, i.e. as opposed to weighting the cash flows. See also * *Expected commercial value * * *First Chicago Method The F ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Finance
Finance is the study and discipline of money, currency and capital assets. It is related to, but not synonymous with economics, the study of production, distribution, and consumption of money, assets, goods and services (the discipline of financial economics bridges the two). Finance activities take place in financial systems at various scopes, thus the field can be roughly divided into personal, corporate, and public finance. In a financial system, assets are bought, sold, or traded as financial instruments, such as currencies, loans, bonds, shares, stocks, options, futures, etc. Assets can also be banked, invested, and insured to maximize value and minimize loss. In practice, risks are always present in any financial action and entities. A broad range of subfields within finance exist due to its wide scope. Asset, money, risk and investment management aim to maximize value and minimize volatility. Financial analysis is viability, stability, and profitability asse ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Net Present Value
The net present value (NPV) or net present worth (NPW) applies to a series of cash flows occurring at different times. The present value of a cash flow depends on the interval of time between now and the cash flow. It also depends on the discount rate. NPV accounts for the time value of money. It provides a method for evaluating and comparing capital projects or financial products with cash flows spread over time, as in loans, investments, payouts from insurance contracts plus many other applications. Time value of money dictates that time affects the value of cash flows. For example, a lender may offer 99 cents for the promise of receiving $1.00 a month from now, but the promise to receive that same dollar 20 years in the future would be worth much less today to that same person (lender), even if the payback in both cases was equally certain. This decrease in the current value of future cash flows is based on a chosen rate of return (or discount rate). If for example there exists ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Cash Flow
A cash flow is a real or virtual movement of money: *a cash flow in its narrow sense is a payment (in a currency), especially from one central bank account to another; the term 'cash flow' is mostly used to describe payments that are expected to happen in the future, are thus uncertain and therefore need to be forecast with cash flows; *a cash flow is determined by its time ''t'', nominal amount ''N'', currency ''CCY'' and account ''A''; symbolically ''CF'' = ''CF''(''t,N,CCY,A''). * it is however popular to use ''cash flow'' in a less specified sense describing (symbolic) payments into or out of a business, project, or financial product. Cash flows are narrowly interconnected with the concepts of value, ''interest rate'' and liquidity. A cash flow that shall happen on a future day ''t''N can be transformed into a cash flow of the same value in ''t''0. Cash flow analysis Cash flows are often transformed into measures that give information e.g. on a company's value and situat ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Drug Development
Drug development is the process of bringing a new pharmaceutical drug to the market once a lead compound has been identified through the process of drug discovery. It includes preclinical research on microorganisms and animals, filing for regulatory status, such as via the United States Food and Drug Administration for an investigational new drug to initiate clinical trials on humans, and may include the step of obtaining regulatory approval with a new drug application to market the drug. The entire process – from concept through preclinical testing in the laboratory to clinical trial development, including Phase I–III trials – to approved vaccine or drug typically takes more than a decade. New chemical entity development Broadly, the process of drug development can be divided into preclinical and clinical work. Pre-clinical New chemical entities (NCEs, also known as new molecular entities or NMEs) are compounds that emerge from the process of drug discovery. Th ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Whitepaper
A white paper is a report or guide that informs readers concisely about a complex issue and presents the issuing body's philosophy on the matter. It is meant to help readers understand an issue, solve a problem, or make a decision. A white paper is the first document researchers should read to better understand a core concept or idea. The term originated in the 1920s to mean a type of position paper or industry report published by some department of the UK government. Since the 1990s, this type of document has proliferated in business. Today, a business-to-business (B2B) white paper is closer to a marketing presentation, a form of content meant to persuade customers and partners and promote a certain product or viewpoint. That makes B2B white papers a type of grey literature. In government The term ''white paper'' originated with the British government and many point to the Churchill White Paper of 1922 as the earliest well-known example under this name. Gertrude Bell, the ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Nature Biotechnology
''Nature Biotechnology'' is a monthly peer-reviewed scientific journal published by Nature Portfolio. The chief editor heads an in-house team of editors. The focus of the journal is biotechnology including research results and the commercial business sector of this field. Coverage includes the related biological, biomedical, agricultural and environmental sciences. Also of interest are the commercial, political, legal, and societal influences that affect this field. The journal continues serial publication of the title "Bio/Technology", which had a publication period of 1983 to 1996. Abstracting and indexing This journal is indexed in Accessed 2012-06-29 * BIOBASE * BIOSIS * Chemical Abstracts Service * CSA Illumina * CAB Abstracts * EMBASE * Scopus * Current Contents * Science Citation Index * Medline (PubMed) According to the '' |
Credit Default Swap
A credit default swap (CDS) is a financial swap agreement that the seller of the CDS will compensate the buyer in the event of a debt default (by the debtor) or other credit event. That is, the seller of the CDS insures the buyer against some reference asset defaulting. The buyer of the CDS makes a series of payments (the CDS "fee" or "spread") to the seller and, in exchange, may expect to receive a payoff if the asset defaults. In the event of default, the buyer of the credit default swap receives compensation (usually the face value of the loan), and the seller of the CDS takes possession of the defaulted loan or its market value in cash. However, anyone can purchase a CDS, even buyers who do not hold the loan instrument and who have no direct insurable interest in the loan (these are called "naked" CDSs). If there are more CDS contracts outstanding than bonds in existence, a protocol exists to hold a credit event auction. The payment received is often substantially less ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Discounted Cash Flow
The discounted cash flow (DCF) analysis is a method in finance of valuing a security, project, company, or asset using the concepts of the time value of money. Discounted cash flow analysis is widely used in investment finance, real estate development, corporate financial management and patent valuation. It was used in industry as early as the 1700s or 1800s, widely discussed in financial economics in the 1960s, and became widely used in U.S. courts in the 1980s and 1990s. Application To apply the method, all future cash flows are estimated and discounted by using cost of capital to give their present values (PVs). The sum of all future cash flows, both incoming and outgoing, is the net present value (NPV), which is taken as the value of the cash flows in question; see aside. For further context see valuation overview; and for the mechanics see valuation using discounted cash flows, which includes modifications typical for startups, private equity and venture capital, co ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Probability
Probability is the branch of mathematics concerning numerical descriptions of how likely an Event (probability theory), event is to occur, or how likely it is that a proposition is true. The probability of an event is a number between 0 and 1, where, roughly speaking, 0 indicates impossibility of the event and 1 indicates certainty."Kendall's Advanced Theory of Statistics, Volume 1: Distribution Theory", Alan Stuart and Keith Ord, 6th Ed, (2009), .William Feller, ''An Introduction to Probability Theory and Its Applications'', (Vol 1), 3rd Ed, (1968), Wiley, . The higher the probability of an event, the more likely it is that the event will occur. A simple example is the tossing of a fair (unbiased) coin. Since the coin is fair, the two outcomes ("heads" and "tails") are both equally probable; the probability of "heads" equals the probability of "tails"; and since no other outcomes are possible, the probability of either "heads" or "tails" is 1/2 (which could also be written ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Expected Value
In probability theory, the expected value (also called expectation, expectancy, mathematical expectation, mean, average, or first moment) is a generalization of the weighted average. Informally, the expected value is the arithmetic mean of a large number of independently selected outcomes of a random variable. The expected value of a random variable with a finite number of outcomes is a weighted average of all possible outcomes. In the case of a continuum of possible outcomes, the expectation is defined by integration. In the axiomatic foundation for probability provided by measure theory, the expectation is given by Lebesgue integration. The expected value of a random variable is often denoted by , , or , with also often stylized as or \mathbb. History The idea of the expected value originated in the middle of the 17th century from the study of the so-called problem of points, which seeks to divide the stakes ''in a fair way'' between two players, who have to end th ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Risk Premium
A risk premium is a measure of excess return that is required by an individual to compensate being subjected to an increased level of risk. It is used widely in finance and economics, the general definition being the expected risky return less the risk-free return, as demonstrated by the formula below. Risk \ premium = E(r) - r_f Where E(r) is the risky expected rate of return and r_f is the risk-free return. The inputs for each of these variables and the ultimate interpretation of the risk premium value differs depending on the application as explained in the following sections. Regardless of the application, the market premium can be volatile as both comprising variables can be impacted independent of each other by both cyclical and abrupt changes. This means that the market premium is dynamic in nature and ever-changing. Additionally, a general observation regardless of application is that the risk premium is larger during economic downturns and during periods of increased u ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Expected Commercial Value
Expected commercial value (ECV), also known as estimated commercial value,Steven Bragg (2020)R&D funding decisions/ref> is a prospect-weighted value for a "project" with unclear conclusions; it is similar to expected net existing value (ENPV). In general ECV is used as a supplementary capital budgeting technique, in that it allows an analyst to compare each project's expected value against its net present value as usually calculated, i.e. using planned and contracted costs. The company can thereby maximize the value and worth of its portfolio of projects, while working within its budget constraints. As with ENPV, developments are defined to represent different project outcomes, with each scenario being assigned a possibility. A project value is computed for each scenario, and the expected commercial value is obtained by multiplying each situation's value by the scenario odds and adding the results. Depending on the procedures used to estimate the value of the project under each ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
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