$2.67
$5.55
bear $2.67
base $4.83
bull $5.55
margin of safety $3.25
market price* $11.84
Crescent Biopharma is a clinical-stage cancer drug developer based in Waltham, Massachusetts. It became public in June 2025 by merging into the shell of GlycoMimetics and is incorporated in the Cayman Islands. Its lead drug, CR-001, is a bispecific antibody aimed at both PD-1 and VEGF; dosing in the global Phase 1/2 ASCEND trial began in February 2026. CR-002 and CR-003 are antibody-drug conjugates. The company paid Sichuan Kelun-Biotech, a Chinese drug developer, $80 million upfront in 2025 for rights to its drug-conjugate technology and owes Kelun further milestones and royalties if products succeed; Kelun holds Greater China rights to CR-001, began a combination study with it in July 2026, and could owe Crescent up to $30 million of development and regulatory milestones. This is a licensing relationship; Crescent is not controlled from China. Crescent has no revenue, no borrowings and pays no dividend. There are no earnings to value. In 2025, owner earnings (operating cash flow, with working-capital timing removed, less stock compensation and capital spending) were a loss of $72.4 million; the $80 million Kelun upfront was a one-time payment and is excluded. In the first half of 2026 operating cash outflow was only $28.4 million, but that figure was flattered by about $11.6 million of bills incurred and not yet paid. Underlying, the company spent about $45.8 million in cash on research and administration in the half, offset by roughly $5.8 million of interest income, and quarterly research spending rose from $17.9 million to $19.4 million. On the same basis as 2025, the half-year loss was about $48 million, a pace near $96 million a year, worse than 2025. We assume about $90 million a year of net cash spending from here, rising as CR-002 enters the clinic (which triggers a $5 million payment to Paragon). Our previous estimate used a lower spending rate of $57 million a year, which did not account for the unpaid bills, and did not include the July offering; those figures are not comparable. What changed since our previous analysis: on July 16, 2026 the company sold 9,387,896 shares at $14.50 and pre-funded warrants for 525,897 more, raising $133.5 million net. Pro forma for that, cash at June 30, 2026 was about $305.1 million and total assets about $316.3 million, against $19.5 million of liabilities (including a $5 million payment due to Kelun in the third quarter of 2026) and no debt. Shares outstanding were 37,143,940 on July 27, 2026, and pre-funded warrants exercisable at $0.001 cover a further 4,637,136 shares, giving about 41.8 million shares for per-share values. The company now gives firm timing for its first evidence: meaningful CR-001 data in the first quarter of 2027, chemotherapy-combination data in mid-2027, and initial data from Kelun's study combining CR-001 with its drug sac-TMT in mid-2027. We credit nothing for the drugs, because no signed sale, approval or revenue yet shows that they generate cash. Each case values the cash and other assets that remain once the first evidence arrives, less what the company owes. Bear case, $2.67 per share. The 2027 data disappoint, but the company keeps spending through the end of 2027 at a higher $100 million a year ($150 million over 18 months), pays $10 million of milestones already in sight to Paragon and Kelun, and then winds down at an assumed cost of $25 million. Business worth: $131.3 million. Owes: $19.5 million. Difference: $111.8 million, about $2.67 per share. Early-stage cancer drugs fail far more often than they succeed, and a PD-1/VEGF antibody faces a crowded field of large competitors, which is why this outcome is the 10th percentile rather than a remote one. Base case, $4.83 per share. The company spends $90 million plus the $5 million CR-002 milestone over the twelve months to mid-2027, when all three dated readouts have arrived. Business worth: $221.3 million. Owes: $19.5 million. Difference: $201.8 million, about $4.83 per share. This is the cash left at the point the evidence arrives, not a forecast of what the company will be worth after the data. Bull case, $5.55 per share. The same spending as the base case, plus the $30 million of Kelun development and regulatory milestones earned on the back of the combination study that started in July 2026. Business worth: $251.3 million. Owes: $19.5 million. Difference: $231.8 million, about $5.55 per share. Strong trial results could be worth much more than this, but there is no contract or approval to put a number on, so we do not include them. What would make this wrong: spending could rise faster than assumed as ASCEND expands and the conjugate programs enter trials; employee stock awards and any further share sales would add shares; and none of the cases captures the value of the drugs if the trials succeed. Interest income will shrink as cash is spent. Margin of safety price, $3.25. We have no earnings level to be sure of, but we are quite sure of the cash, which comes straight from the June 30 balance sheet and a completed, closed offering. The worst plausible outcome is a clear failure of CR-001 followed by a year of spending on other programs and a wind-down, which leaves roughly $2.67 per share; with no debt, nothing is owed to lenders ahead of shareholders, though a management that kept spending into 2028 instead of returning cash could leave less. The things we are most likely to be wrong about are the spending rate and the share count: each extra $10 million spent costs about 24 cents per share, so a burn of $120 million rather than $90 million in the base case would leave about $4.10. The price assumes a holding period of roughly one year, to the mid-2027 readouts, and the business pays nothing during that time. From $3.25 the bear case implies a loss of under a fifth, while the base-case cash alone implies a gain close to half within a year, with no value assigned to the drugs; that balance is what supports the 20% annual target.