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Non-Tech : Bill Wexler's Dog Pound

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To: Shawn Donahue who wrote (8064)	7/9/2001 1:42:57 PM
From: Biomaven	of 10293

Shawn, The OSIP molecule (OSI-774) is an interesting example of the change I am talking about. OSI first licensed it to PFE in the mid-80's for a mere 5% royalty. When they got the rights back in June 2000 (because of the PFE/WLA merger) they quickly turned around and licensed it to DNA/Roche in a 50:50 deal. True the drug was more advanced - PFE had taken it into Phase II, but still this is a reflection of just how valuable a moderately late stage promising product is now. Note that OSI-774 will likely not even be the first drug in its class on the market (AZN's Iressa should be first, and both will likely be behind IMCL's antibody approach to the same target. PFE also has a program here that came from WLA, but that in true big pharma fashion we haven't heard much about). I've held OSIP since 1999 - just tagging along behind Rick Harmon and Miljenko on this one. I added to my position when they re-acquired their rights from PFE. I've taken some profits along the way, but it's still a significant holding for me. Everything in biotech (paradoxically for such a fast moving field) really happens in ultra-slow motion. You are talking a decade or more from target to drug, and so pharma are still partly living off the cheap licensing deals they made in the 80's and early 90's. This in-licensing is vitally important to many pharmas - for example, virtually all of BMY's large portfolio of oncology drugs were in-licensed. What I am claiming is that there has been a structural change in biotech/pharma relations that has fundamentally altered the balance of power. The only real countervailing trend that I see is whether taking advantage of genomics really entails large economies of scale which might make it difficult for the small, nimble and smart to compete with the big. In my view, this remains an open question. Peter

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