ANAPTYSBIO, INC (ANAB) stock intrinsic value fair value estimate & owner earnings analysis

What the company is now. On April 20, 2026, AnaptysBio spun off its drug-development business as First Tracks Biotherapeutics (one First Tracks share for each Anaptys share held on April 6, 2026). The company that remains is a small royalty holder with very few employees. It owns two income streams. The first is royalties and milestones from GSK on Jemperli (dostarlimab), a PD-1 cancer antibody that Anaptys discovered and licensed to Tesaro, now part of GSK. The second is a license of imsidolimab to Vanda Pharmaceuticals. Almost all of the value is Jemperli. The company has also moved its fiscal year-end from December 31 to June 30. Why the past record is not the starting point. Before the spin-off, Anaptys spent heavily on research. On our owner-earnings measure (cash from operations, less stock-based pay, less capital spending, with working-capital timing swings removed) it lost money every year from 2017 to 2025: between $0.55 and $5.74 per share, and $0.55 in 2025. That research spending left with First Tracks. Those years describe a different business, so we value the royalty company directly from its contracts. How the Jemperli royalty works. GSK pays 8% on annual worldwide Jemperli net sales up to $1.0 billion, 12% on sales from $1.0 to $1.5 billion, 20% from $1.5 to $2.5 billion, and 25% above $2.5 billion. Because the rate rises with sales, each extra dollar of sales is worth more than the one before. Jemperli sales were $598 million in 2024 and about $1.1 billion in 2025 (GSK reported GBP 861 million). In the first half of 2026 they were $644 million, up 34%, and in the second quarter $331 million, up 26%. Growth is slowing, though. Sales for the latest twelve months were GBP 971 million, which averages about GBP 245 million a quarter. The two most recent quarters were GBP 232 million and GBP 248 million, so sales have been roughly flat quarter to quarter for a year. That flattening is the most important fact in this valuation, and it is why our cases sit well below GSK's own guidance that Jemperli alone will reach peak sales of more than GBP 2 billion. The Sagard obligation. In 2021 and 2024, Anaptys sold Jemperli royalties and milestones to Sagard Healthcare Royalty Partners for $300 million in total. Sagard keeps every Jemperli royalty and milestone payment until it has collected $600 million (or $675 million if that point comes after March 31, 2031). After that, all Jemperli royalties come back to Anaptys. Sagard had collected about $301 million through June 2026, which leaves about $299 million. Sagard has no claim on Anaptys's other assets. The company expects the balance to be paid off in the second half of 2027. On our base-case sales path it takes until partway through 2028. Until then Anaptys receives essentially no Jemperli cash (it did keep and collect a separate $75 million milestone in December 2025). We value only the royalties Anaptys itself will receive. That is how the Sagard debt enters the valuation, and nothing is deducted for it on top. How long the royalty lasts. The GSK agreement runs for each product until the later of 12 years after first commercial sale (Jemperli launched in 2021) or the expiry of the last patent. Anaptys's dostarlimab patents could provide protection until June 2038. All three cases stop the Jemperli royalty in mid-2038. None of them assumes value beyond that date. Costs and taxes. The company expects to run with minimal operating costs. Its general and administrative expense in the first half of 2026 was $23.4 million, which was inflated by the costs of the separation and the GSK lawsuit. We assume about $20 million a year through 2027 while the lawsuit and Sagard period continue, then $14 million a year including stock-based pay. In June 2026 the company recognized a $181.5 million tax asset because it now expects to use past losses and credits against royalty income. We assume that asset shelters the first $181.5 million of tax, and that a combined rate of about 23% applies after that. We could not confirm from the filings whether any tax-law limits restrict the use of those losses. Anaptys held $164.1 million of cash and short-term investments at June 30, 2026. We do not add that balance to the value. We count only the interest it earns, about $5 million a year. Base case, $37.11 per share. Jemperli sales reach about $1.35 billion in 2026, based on the current quarterly run rate plus modest growth. They then grow 13% in 2027, helped by the rectal-cancer filing from the AZUR-1 study (the FDA's decision is due in February 2027), and slow to a plateau of about $1.95 billion from 2031. Sales growth was 26% in the latest quarter. Our base case assumes about 20% for 2026 in dollar terms and 13% for 2027, both below that recent pace. At $1.95 billion, Jemperli pays Anaptys about $230 million a year before costs and tax. In the base case, imsidolimab is approved for generalized pustular psoriasis (the FDA's decision is due December 12, 2026). That brings a $5 million milestone and a 10% royalty on modest sales. After-tax cash flows discounted at 6% total about $1.25 billion. We divide by about 33.6 million diluted shares: 29.7 million outstanding, restricted and performance stock units, and in-the-money options (6.9 million options with an average exercise price of $23.35 were outstanding at the end of 2025, before exercises in 2026). Bear case, $19.32 per share. The four flat quarters mean Jemperli's growth is already over. Sales stay near $1.35 billion a year through 2038, which pays about $122 million a year. Sagard is not repaid until late 2028. Legal and overhead costs run higher, at $20-22 million a year. Imsidolimab contributes nothing, because it is either rejected or sells very little. The value comes to about $610 million on about 31.6 million shares. Bull case, $64.81 per share. GSK's growth plans deliver. The AZUR-1 rectal indication launches in 2027, and the Phase 3 colon cancer (AZUR-2) and head-and-neck (JADE) studies read out positively in 2028. Sales rise to $2.7 billion by 2030 and $2.8 billion from 2031. At that level the royalty is about $415 million a year, because of the 20% and 25% tiers. Sagard is repaid in early 2028. Imsidolimab passes $100 million in sales and earns its $25 million milestone. The value comes to about $2.27 billion on about 35.0 million shares. What is left out. Anaptys has sued Tesaro and GSK in Delaware Chancery Court, saying Tesaro breached the license by taking part in development work with rival PD-1 drugs. Anaptys is asking for Jemperli rights to be returned. The court dismissed Tesaro's anticipatory-breach counterclaim in April 2026, and the trial took place on July 14-17, 2026. A post-trial hearing is set for October 20, 2026, with a judgment expected in late 2026 or early 2027. We give no value to a win. Getting the rights back would be a large change, but how it would work in practice is not yet known. Tesaro's remaining claim asks the court to declare that it has not breached the license, and the filings describe no remedy that would reduce the royalty. A loss would therefore mainly cost legal fees, which the higher cost assumptions in the bear case cover. What would make this wrong. The biggest single factor is how high Jemperli sales go. Every $100 million of annual sales in the 20% band is worth $20 million a year of royalty. A clear return to growth from the current plateau would push value toward the bull case. A decline in sales, from competing PD-1 treatments in endometrial cancer or from GSK putting less effort behind the drug, would push it below the bear case. Other risks are that the patents last a shorter time than the 2038 date the filings give, or that the tax asset turns out to be less usable than assumed.