John,
I'm pleased to be participating in the thread and hope that it provides some valuable information.
Pharmacopeia does in fact have a full blown screening operation in house. We currently can screen about 100,000 compounds per week per assay, comparable to any big pharma. We do enzyme, receptor binding and cell-based assays. In addition, we are currently developing ultra high throughput screening technologies that will enable our biologists to screen 100,000 compounds per day! We have working prototypes now and expect to have fully functional systems by mid 1998.
As for deal structure, I can only comment on Pharmacopeia. We have signed several different types of deals. With Schering-Plough, Novartis, Bayer and Zeneca, we design and synthesize libraries of compounds for them to screen in their own labs. For these types of deals, we get an upfront license fee (which basically covers our fully burdened cost of making the library) plus milestones and low single digit royalties. In our drug discovery collaborations with Schering-Plough, Berlex, Bayer, Daiichi and Organon (where we design and synthesize the compounds and do the screening at Pharmacopeia and deliver to our partner an optimized lead compound), we also get up front payments, milestones and mid to high single digit royalties. Finally, with our internal discovery programs, we would expect to outlicense the programs to big pharma and, again, receive upfront payments, milestones, and high single to low double digit royalties.
I'm not sure it's the royalty rates that make or break a deal. It's more likely the "pride of ownership" concept. When we ship our compounds to a collaborator, we are "leasing" them the compounds. They get to screen the compounds for a predetermined period of time. When the period ends, they get a license to the active ones, the non active compounds revert back to Pharmacopeia. This is an important part of our strategy as we look to create the world's largest sample collection of compounds. Of the 3.3 million unique, novel compounds that we've created, over 2 million of them are free and clear for us to use in our internal programs. That's a really powerful tool for us.
Again, I'd like to caution you to take a good look, and question, the difference between the biotech deals that are being announced versus the big pharma deals. I think you'll find some significant differences (i.e., up front payments etc.)
Sue |
