Henry,
I think you just made my argument more effectively than I could have myself. Someone recently posted that (as best I can recall) it takes $250 million and 3 years to get drugs through clinicals. Your post highlights the six top prospect of which Pfizer owns two. So, lets be conservative and say that Ligand doesn't have to spend on nickel on the two PFE has, leaving four remaining. That's order of magnitude $1 billion. And you know better than I that there plenty more candidates behind those six.
BioPharm, the trade journal, just published a ten year anniversary issue, which I encourage everyone to read, if they can. I don't know if its on the web. In it, they list the value of all the deals done in biotechnology between July 1996 and June 1997. The top five are : P&G:Regeneron ($135 million), Biogen:Creative BioMolecule ($122 Million), Baxter:VIMRx ($120 million), Wyeth-Ayerst:3D Pharmaceutical ($112 million) and Wyeth-Ayerst:Millennium ($90 million). In the numbers I was pushing around, I assumed Ligand would get about $175 million for diabetes, or 50% higher than the highest deal in that list. I would hardly consider that a conservative assessment of their potential. (I know Guilford deal [August] is being valued at over $400 million but that's for ten indications, not one.)
Henry, I'm really not arguing about how good the pipeline is (I enthusiastically concede its wonderful) or whether the diabetes deal is or isn't done. I am simply saying their pipeline implies unprecedented levels of investment and I doubt if Big Pharma will sign up for those numbers without owning the whole enchilada. And I think the anecdotal evidence confirms this assessment! |
