We're in disagreement. I see it as a very sharp move by LLY.
5 programs partnered with LLY. I think 3 are antibodies, 1 a non mab protein and 1 growth factor. Consider LLY's current portfolio, assume most, if not all, are next gen's and take guesses. Xigris is an obvious one. Straight 5% royalties per program and I estimate $40-50M in milestones along the way, mostly back end loaded.
I see this as two fold, number one, LLY obviously liked what they saw in their 5 programs and I can guess 1-2 are nearing the clinic. So saving potential future royalties and milestones is a real consideration. Not to mention possible revenues on 3 medi programs, and whatever advances among JNJ, CHIR, Eyetech, Cancervax etc. I can also speculate that LLY was considering adding additional lly cpds for amev to optimize and or involved in negotiations for inlicensing 1 of amev's 2 lead internal programs. At some point it must have crossed their mind, why not buy the cow?
I'm guessing the bigger motivation is this is a way for LLY to jump head first into next generation antibody development, cheaply and assume a potential leadership position. If they so choose, they now have an anti-tnf that theoretically may prove superior to remicade, an anticd20 that I will bet now will prove better than rituxan (we'll see in 5 years :-) and not too hard to imagine they can quickly optimize avastin and egfr antibodies which would put LLY right in the middle of oncology antibodies. Simply put, this will give lly a lot of development and strategic options well beyond their 5 compounds.
I've always viewed amev as much more than a tool company and I think this will be borne out with LLY in control. So if LLY intends to leverage amev all the way, I think it will prove a brilliant acquisition, if not, it will be a shame.
I don't *think* amev would have sold out if they didn't feel lly had big plans.
Also add, I'm holding out hope that DNA or JNJ will counter offer. |
