Ted, provocative "speculation." Coming back to this thread after being away for over a day can be punishing. Plenty to mull over.
I have wondered about LGND's timing of the call of ALRI since the announcement. You propose that JNJ's threat to buy AGN, and hence be in a good position to wait out LGND, as being LGND's motivation to do the call prior to announcing a diabetes deal. If that's true then JNJ is probably not LGND's diabetes alliance mate. I agree with the logic, that it may have been in LGND's best interest to do the call prior to doing the deal primarily (but not solely)to prevent big pharma from being able to control licensing or co-licensing, and from obtaining an agreement regarding the split up of ALRI assets that would be less favorable to LGND than the one just announced with AGN. The strategy of doing the call first seems to make sense regardless of which big pharmaceutical might be lurking or threatening. By making the call, LGND stakes claim to a clearly defined (and hopefully quite valuable) inventory, and, IMO, is better positioned to ally with those with deeper pockets to investigate and market the compounds, unencumbered by ALRI.
Robinson's comments suggest to me, and I believe Henry and others have stated this previously, that the diabetes deal is done. For the reason you stated, ie huge pipeline, LGND needs alliance monies to grow. I'm in the camp that believes that we are soon going to get a major cash infusion. We are left guessing about the timing and content of near term announcements and what these will do for/(to!) LGND's stock price. How did you arrive at the $25-30/share?
Earlier in the weekend there was discussion of the proportions of cash and LGND stock that would be used for the ALRI call. My preference would be to use the cheaper currency, which in my opinion, given my bullish view on the company I partly own, is to give them cash. As much cash as we can spare. IMO, unless the stock trades at a substantial premium to Friday's close, cash is the cheaper. The stock appears undervalued now but should rise to more appropriate valuations within a matter of months, assuming that announcements regarding a DM deal and encouraging results from clinical trials are on the horizon.
Of course I'm assuming that LGND is going to have cash to spare!
Switching gears, there appear to be a lack of symmetry in the split of royalties for compounds used in treating diabetes. Whereas AGN is granted, depending on the compound, 6%, 33%, or 50% plus milestone payments, LGND gets a flat 6% from sales of ALRT326 and ALRT4204. Why the discrepancy? Anyone.
Now, back to football, something easier on the mind. The posts to this thread make great reading. Informative, entertaining, and voluminous. Whew. |
