medsunman, I think it's worthwhile reviewing how LGND's alliances are structured. In general, LGND screens a library and selects a compound. Then they may help out with some of the pre-clinicals, but they really don't benefit much until the compounds enter the clinic. LGND then begins to get milestone (or more significant milestone) payments and the resources of their partner (large pharms) begins to be a factor.
LGND really doesn't do anything at that point other than cash the checks. Thus, as more compounds enter the clinic, LGND will receive more in milstone payments. I believe that the LLY payments a quite significant and I believe that the start of US diabetes trials for Targretin, as well as an IND for one of the second generation compounds, will trigger those payments.
Long term shareholders must take some reassurance from analyst's predictions. These projections are based in part on milestone and royalty payments from LGND's extensive pipleine. These payments begin when the compounds enter the clinic, which is why the series of IND filing is a plus.
With repsect to Droloxifene, it should be noted that the PFE alliance is for osteoporosis and the cancer royalty rate was quite small (1%). For most of LGND's alliances, LGND can actually license back the selected compound(s) for cancer applications. The change in direction for Droloxifene should speed up approval for osteoporosis which is a larger market and LGND gets a higher royalty.
However, from the science side, the SERMs will probably would better when given in combination with retinoids such as Panretin or rexinoids such as Targretin. Combination trials of Tamoxifen (which I believe is closely related to Droloxifene and Evista) and Panretin, have already begun for breast cancer (see home.att.net ) and animal data suggests that Targretin has breast cancer prevention applications as monothery as well as combination therapy with Tamoxifen. The LLY alliance will explore such combination (Targretin & Evista?) for applications for human cancer (breast?).
Thus, the Droloxifene results may actually signal sucess for combinations, which could include two of LGND's compounds (each of which returns double digit royalties, or in the case of Panretin, returns the lion's share of profits to LGND). |
