Deciphera Pharmaceuticals IPO Valuation Looks Overinflated

When the Deciphera Pharmaceuticals IPO was announced in September 2017, fears were immediately voiced that the valuation being proposed was inflated beyond what was reasonable. The Massachusetts based company is involved in the development of various cancer therapies at the cutting edge of part of that field, specifically the part that develops therapies that can nullify the body’s natural drug resistance formation mechanisms. If Deciphera’s therapies succeed, then existing cancer therapies will be able to operate for longer periods of time and at greater degrees of efficiency. Naturally, all people will hope that Deciphera succeeds in their development for the sake of the many thousands who its therapies could help. However, it has to be pointed out that all of the candidates are at an early stage of development. For instance, DCC-2618, an inhibitor of cancer driving kinase enzymes is only at the Phase 1 testing stage. DCC-3014, a kinase inhibitor which controls a tumour associated TAMs (tumour-associated macrophages) as at the same stage; the same is also true of rebastinib, yet another inhibitor, this acting on cancer cell-surface receptors. All of these therapies are considered to be promising and each could develop into a powerful weapon in the arsenal of cancer therapies that are being developed through the efforts of high tech pharma research. However, as we have pointed out, these therapies are in the very early stages of their testing and there is much that can go wrong, as has been seen many times in the past. This information is bound to play a very significant role is informing opinion about the Deciphera Pharmaceuticals IPO and especially on discussions about whether or not the Initial Public Offering is overvalued or not.


Indeed, many of the problems associated with Pharma IPOs can be seen with this Deciphera Pharmaceuticals IPO. Obviously, the company has good ideas and they might come to fruition and eventually make the company a good investment with a powerful and in-demand range of advanced therapies much in demand by the medical industry all over the world. Or they might fall foul of any one of a number of obstacles that have yet to be surmounted. The truth is that the testing process is long and arduous for a reason, and that reason is that the efficacy of particular therapy is not actually known until after the tests are completed. Another factor for concern noted by those looking into the circumstances surrounding the Deciphera Pharmaceuticals IPO is the significant competition which the company will face from larger and better financed Pharmaceutical concerns. Of course, the rival products from these rival concerns are just as likely to fail in the testing process, but Deciphera seems to be the particularly vulnerable place. For this reason, many observers have noted that the IPO’s valuation seems over-inflated for what will be a very high-risk investment.


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