ABT is smoking something seriously powerful with this royalty dispute. Here are the provisions from the Knoll agreement. Total BS in my view and will redound to abt badly. Typical US big-company commercial practices, unfortunately. Adding back the full PV of the H royalty to my model. Still don't like scarring programs though.
1.56 Royalties paid to third parties, other than to MRC under the MRC-Patents, to license rights needed by Knoll, its Affiliates or permitted sublicensees, to practice or to have practiced the technology claimed in the Patents, will be borne [***], provided, however, that the royalty payable to CAT pursuant to Section 5.00 shall no be reduced below [***] of Net Sales in any year for which a royalty is owed to CAT. The [***] royalty to be paid to MRC under the MRC-Patents shall be paid directly by Knoll to MRC and shall be directly offset against the [***] royalties due to CAT pursuant to Section 5.00.
1.30 "Patents" means PCT applications WO 90/5144 (Winter 2) except as pertaining to [***], as published on May 17, 1990, and WO 92/1047 (McCafferty), the patents when granted, including any patents which derive from the Patents and any divisions, renewals, continuations, continuations-in-part, extensions or reissues.
1.36 "Target(s)" shall mean the Antigen(s) for which CAT and Knoll have agreed to conduct a collaborative Research Program pursuant to Article 2 of this Agreement.
1.37 "Target- 1" shall mean TNF.
1.38 "Target-2" shall mean IL-12.
1.39 "Target-X" where "X" is an integer selected from "3, 4, 5 and 6" corresponding to each subsequent Antigen designated pursuant to Article 18 of this Agreement.
1.40 "Term" means the term of this Agreement under Article 16.
1.41 "TNF" shall mean human tumor necrosis factor-(a) (TNF-a).
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