NPV modelling for the selection of value-creating biosimilar development candidates

2013 ◽  
Vol 19 (1) ◽  
Author(s):  
Klaus Nickisch ◽  
Kerstin M Bode-Greuel
Keyword(s):  
Small Molecule ◽  
Net Present Value ◽  
Business Risk ◽  
Present Value ◽  
Challenges And Opportunities ◽  
Selection Of

The purpose of this study was to apply net present value (NPV) modelling to evaluate the financial attractiveness and business risk of different categories of biosimilars. Challenges and opportunities of biosimilars are compared with those of standard small molecule generics. Minimum peak sales levels are required to create financial value were determined in order to derive recommendations for the selection of commercially rewarding biosimilar development candidates.

scholarly journals Computing Capital Budgeting for Banking Sector

2021 ◽  
Vol 58 (2) ◽  
pp. 6502-6508
Author(s):  
Sushain Koul, Dr. Parag Ravikant Kaveri
Keyword(s):  
Financial Management ◽  
Banking Sector ◽  
Net Present Value ◽  
Average Rate ◽  
Capital Budgeting ◽  
Rate Of Return ◽  
Present Value ◽  
Banking Organization ◽  
Long Run ◽  
Selection Of

Perhaps the most difficult hurdle which companies come across is the selection of the project which is beneficial to the organization in the long-run and also increases the present value of the shareholders. This is where Capital Budgeting comes into play. Capital Budgeting is one of the most important areas of financial management. This paper gives an overview of what capital budgeting is, what different types of techniques comes under capital budgeting and how to represent capital budgeting technique algorithmically. In this paper we also throw some light on what the results of various capital budgeting techniques will be if any banking organization follows these techniques and compare those results. These techniques namely as Payback Period (PP), Average Rate of Return (ARR), Net Present Value (NPV), Profitability Index (PI) and Internal Rate of Return (IRR) are used to evaluate projects.

scholarly journals SELECTION OF ALTERNATIVES FOR OIL FIELD DEVELOPMENT BY GENETIC ALGORITHMS

2002 ◽  
Vol 1 (2) ◽  
Author(s):  
Yvan J. Túpac ◽  
Marley Maria B.R. Vellasco ◽  
Marco Aurélio C. Pacheco
Keyword(s):  
Genetic Algorithm ◽  
Net Present Value ◽  
Oil Field ◽  
Oil Reservoir ◽  
Present Value ◽  
Field Development ◽  
Oil Field Development ◽  
The One ◽  
Genetic Algorithm Model ◽  
Selection Of

This paper presents a Genetic Algorithm application for selecting the best alternative for oil field development under certainty. The alternatives in this study are related to the arrangement of wells in a known and delimited oil reservoir and serve as a basis for calculating the net present value, which is used to assess the optimization process: the optimal alternative is the one that maximizes the Net Present Value of the field. The results obtained have revealed that the Genetic Algorithm model was able to find good alternatives for the oil field development, achieving good results for the Net Present Value.

scholarly journals Analysis of the incremental cost method and the net present value method applied in the energy sector

2018 ◽  
Vol 49 ◽  
pp. 00075
Author(s):  
Tadeusz Noch ◽  
Zdzisław Kusto
Keyword(s):  
Incremental Cost ◽  
Net Present Value ◽  
Heating System ◽  
Heat Pumps ◽  
Third Party ◽  
Bank Loan ◽  
Heat Sources ◽  
Present Value ◽  
Optimal Heating ◽  
Selection Of

The study characterizes hybrid sources applied in the power industry, created with the use of unconventional energy sources. An example of cooperation of heat pumps and conventional sources was used. The article notes the technological progress also concerning heat exchangers. To calculate economic efficiency, the MKN Incremental Cost Method and the NPV Net Present Value method were used. The article refers to the calculation of investment outlays and operating costs and repayment of a bank loan for individual heat sources. The possibility of assuming separate values of discount rates for the installation of heat pumps and hybrid boilers as well as the comparative installation were shown. Also included is the possibility of adopting a separate discount rate for income derived from savings associated with the purchase of fuel and energy and the sale of heat to a third party consumer. The analysis covered the MKN Incremental Cost Method and the NPV Net Present Value method. The computational algorithm contains costs of hybrid installation with heat pumps and costs of a comparative conventional installation in a version without revenues and with revenues from the sale of heat. Presented is the method of calculating the net present value in the next year of operation, discounting to the zero year and observing in which year the positive value will be obtained. Economic calculations, according to popular views, are the basis for choosing the optimal heating variant. Ecological effects and social demand may provide additional separate criteria in the selection of the heating system.

scholarly journals Economic Calculus Qua an Instrument to Support Sustainable Development under Increasing Risk

2021 ◽  
Vol 14 (1) ◽  
pp. 15
Author(s):  
Grzegorz Drozdowski
Keyword(s):  
Sustainable Development ◽  
High Risk ◽  
Net Present Value ◽  
Investment Decisions ◽  
Economic Calculation ◽  
Present Value ◽  
Financial Account ◽  
Increasing Risk ◽  
A Company ◽  
Selection Of

Investment decisions in the field of sustainable development should be taken based on an economic calculation, taking into account the analysis of a diverse economic environment. The economic calculus of an enterprise is treated as a kind of way of thinking about the rationality of decisions made by an entrepreneur. In the case of sustainable development, the economic calculus serves as an instrument to support the selection of the investment measure. The result of the economic calculus is based on various types of economic parameters, which are subject to frequent changes and high risk. A risk-based financial account may be of little use in the context of the unpredictability of the forecasted situations. In the article, I attempted to determine the importance of a variable interest rate in the economic calculus of a company as an instrument to support sustainable development. For this purpose, I modified the Net Present Value (NPV) meter, which contains actual (variable) discount rates.

The Consideration of Risk in Project Selection

1968 ◽  
Vol 94 (3) ◽  
pp. 355-378 ◽  
Author(s):  
S. D. Hodges ◽  
P. G. Moore
Keyword(s):  
Capital Investment ◽  
Net Present Value ◽  
Internal Rate Of Return ◽  
Present Value ◽  
Financial Investment ◽  
Investment Projects ◽  
Average Value ◽  
Wide Range ◽  
Financial Investments ◽  
Selection Of

This paper is concerned with attempts that have been made to incorporate measures of risk in the selection of financial investments. The methodology that is developed here has been primarily aimed at the evaluation of capital investment projects, but the concepts and ideas are also relevant in the financial investment field. Implicit in all this discussion is the fact that when information is obtained in order to calculate an internal rate of return or a net present value, the figures put into the calculation are estimates rather than precise and exact quantities. In some instances the estimates may be felt to be very good, whilst in other cases it may be felt that there is a wide range of possible deviations. Hence the evaluation of any project or projects should, correctly, be described not by a single criterion but by a range of possible values, some of which are judged to be more likely than others. Having said this, there now comes the need to decide upon the method by which choice is to be exercised. Should it be by the choice of the highest average value of the criterion, or by choosing some more conservative rule?

Project Prioritization via Optimization

2007 ◽  
Author(s):  
Ali Koc¸ ◽  
David Morton ◽  
Elmira Popova ◽  
Ernie Kee ◽  
Drew Richards ◽  
...  
Keyword(s):  
Net Present Value ◽  
South Texas ◽  
Capital Investments ◽  
Present Value ◽  
Priority List ◽  
Ranking Scheme ◽  
Multiple Scenarios ◽  
Additional Constraints ◽  
Operating Company ◽  
Selection Of

We consider a problem commonly faced in industry, involving annual selection of plant capital investments. A typical approach to such a problem uses a multi-knapsack formulation, which takes as input the available budget in each year, the stream of liabilities induced by selecting each project, and the profit, i.e., net present value, of each project. The goal is to select the portfolio of projects with the highest total net present value, while observing the budget constraint for each year, as well as any additional constraints. A portfolio selected in this manner can fail to hedge against uncertainties in the budget, the liability stream and the profit. So, we propose a model that forms an optimal priority list of projects, incorporating multiple scenarios for these input parameters. Our model is not a simplistic ranking scheme. Structural and stochastic dependencies among the projects are key to our approach. We apply our methods on a set of example projects from South Texas Project Nuclear Operating Company.

scholarly journals SELECTION OF ALTERNATIVES FOR OIL FIELD DEVELOPMENT BY GENETIC ALGORITHMS

2002 ◽  
Vol 1 (2) ◽  
pp. 51 ◽  
Author(s):  
Yvan J. Túpac ◽  
Marley Maria B.R. Vellasco ◽  
Marco Aurélio C. Pacheco
Keyword(s):  
Genetic Algorithm ◽  
Net Present Value ◽  
Oil Field ◽  
Oil Reservoir ◽  
Present Value ◽  
Field Development ◽  
Oil Field Development ◽  
The One ◽  
Genetic Algorithm Model ◽  
Selection Of

This paper presents a Genetic Algorithm application for selecting the best alternative for oil field development under certainty. The alternatives in this study are related to the arrangement of wells in a known and delimited oil reservoir and serve as a basis for calculating the net present value, which is used to assess the optimization process: the optimal alternative is the one that maximizes the Net Present Value of the field. The results obtained have revealed that the Genetic Algorithm model was able to find good alternatives for the oil field development, achieving good results for the Net Present Value.

ANALISIS KELAYAKAN FINANSIAL INDUSTRI PENGOLAHAN KECAP ANEKA GUNA DI KOTA LANGSA

2017 ◽  
Vol 2 (1) ◽  
pp. 21-30
Author(s):  
Muhammad Jamil ◽  
Januari Frizki Bella
Keyword(s):  
Net Present Value ◽  
Rate Of Return ◽  
Internal Rate Of Return ◽  
Present Value ◽  
Internal Rate

Adapun tujuan dari Penelitian ini adalah untuk mengetahui kelayakan usaha industri pengolahan kecap Aneka Guna apabila dilihat dari segi kelayakan finansial. Penelitian ini menggunakan metode studi kasus. Lokasi penelitian yaitu di Kota Langsa dengan pertimbangan bahwa lokasi tersebut merupakan daerah yang terdapat industri pengolahan kecap asin dan mudah di jangkau oleh penulis. Waktu penelitian dilaksanakan pada Bulan Juni - Oktober 2014. Tenaga kerja yang digunakan berjumlah 27 orang, 20 tenaga kerja pria dan 7 orang tenaga kerja wanita. Jumlah penggunaan tenaga kerja selama 5 tahun sebesar 3759 HKP. Total biaya produksi yang dikeluarkan oleh pengusaha dalam usaha pembuatan kecap didaerah penelitian selama 5 tahun adalah Rp. 2.076.988.000,-. Pendapatan kotor yang diperoleh pengusaha sebesar Rp. 8.199.690.000,- dan pendapan bersih yang diperoleh sebesar Rp. 6.122.702.000,-                 Kota Langsa hanya memiliki 1 pengusaha pengolahan kecap asin dan dijadikan sebagai pengusaha sampel yaitu usaha industri pengolahan kecap asin Aneka Guna. Hasil perhitungan di peroleh Net Present Value (NPV) sebesar Rp. 263.281.290 (lebih besar dari nol), sedangkan Internal Rate of Return (IRR) sebesar 84% lebih besar dari tingkat bunga yang berlaku (D.F. = 18%), sedangkan Net B/C Ratio sebesar 3,27 (lebih dari pada 1) dan Pay Back Priod (PBP) 1 Tahun 6 Bulan (lebih kecil dari umur ekonomis).  

UNIFICATION OF STANDS SELECTION FOR FINAL FELLING IN STRATEGIC AND TACTICAL PLANNING

2015 ◽  
Author(s):  
Ainārs GRĪNVALDS
Keyword(s):  
Strategic Planning ◽  
Net Present Value ◽  
Strategic Plan ◽  
Regression Function ◽  
Tactical Planning ◽  
Present Value ◽  
Black Alder ◽  
Value Maximization ◽  
Annual Changes ◽  
Selection For

The stand selection for cutting in tactical planning should be done according to the same principles like in strategic planning – to maximize net present value. The simple way of how to transfer the net present value maximization principle from strategic planning to tactical planning was created in Sweden. The method is based on annual changes in the net present value by postponing final felling. Forest inventory data and forestry modelling system was used for calculation of changes in net present value for pine, spruce, birch, aspen and black alder stands. And changes in net present value were described by regression function with factors from stand parameters. The regression function allows calculating annual changes in net present value for each stand. And stands with higher decrease in net present value have higher cutting priority. Stands selected for the final felling in strategic plan were compared with the stands selected in tactical plan with two methods, first, by using annual changes in the net present value, second, by traditional planning principles. Stands selected by annual changes in the net present value were similar to stands that were selected for cutting in strategic plan, but stands selected by traditional planning principles – not.

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