rkwk,
Your point about royalties is a good one. While I anticipate that we will still sign drug target discovery deals that include provisions for royalties, we believe that an increasing proportion of our deals will be subscriptions to our GeneExpress(TM) databases. The latter will be "cash and carry" deals and may have no provisions for milestones or royalties.
For those deals that do include royalty provisions, the royalties are generally in the low single digits for small molecule drugs and the high single digits for protein pharmaceuticals.
I cannot give you guidance on dilution, other than to direct you to our financial statements. Whether we will need to raise additional equity capital will depend in part on how fast our revenues grow.
The paragraphs above contain forward-looking statements about revenue growth, potential new collaborative agreements and customers, and potential milestone payments and royalties. Such statements reflect management's current view of future events. Actual results may differ materially from these projections because of a number of factors, including risks related to competition, technological advances, technological challenges in developing genomic database products, the extent to which the pharmaceutical industry uses genomic information, market acceptance of the company's products (including the GeneExpress databases), the company's ability to enforce its intellectual property rights, the impact of the intellectual property rights of others, and the company's reliance on collaborative partners to develop new drugs. There is no assurance that the company will be able to sign new collaborative agreements, acquire new customers, or retain current customers. There is no assurance that revenues will grow or that the company will receive any milestone payments or royalties. The success of the GeneExpress product line will depend in part on the ability of Affymetrix Inc. to supply adequate quantities of high-quality GeneChip(R) probe arrays. These risk factors and others are more fully described in the company's Annual Report on Form 10-K for the year ended December 31, 1998, and other documents filed with the Securities and Exchange Commission.
Steve Push
VP, Corporate Communications
Gene Logic Inc.
genelogic.com |
