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Biotech / Medical : Millennium Pharmaceuticals, Inc. (MLNM)
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To: Biomaven who wrote (1677)7/1/2003 2:55:05 PM
From: Ian@SI  Read Replies (1) of 3044
 
Peter

During MLNM's conference call, one of the Q dealt with just what JNJ got the rights to, Velcade alone or all of MLNM's proteasome "stuff". The answer was, "Velcade and its analogues". When the analyst said, "Velcade and derivatives", he was quickly corrected to "Velcade and analogues".

Is there some significance to the distinction????

Erik,

For $15M up front, it seems to me that JNJ got the right to share in absolutely no revenue whatsoever. Rather they got the right to pay MLNM over $0.5B in milestone payments during the next 3 years (or so) with $135M coming later this year with EU approval for V used for MM.

During the conference call the royalty was described as "substantial double digit". Later during the Q&A, there was a comment from MLNM along the lines of "Not much difference between royalty revenue and sharing profit"; and that royalties escalate after sales exceed certain unspecified milestones.

This seems to imply that MLNM will get revenue from JNJ sales even while Velcade may not be profitable due to introductory marketing/sales costs.

Seems to me that longer term or strategically, MLNM gave away very little while JNJ will in effect pay all future development costs plus give MLNM the lion's share of future revenues.

FWIW,
Ian
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