>>>>I would be extremely pleased with 15-20% royalties, if they partnered with a capable big pharma. <<<
Aaackk!!! Now there's a deal I'd hate to see. I couldn't dig up any examples of deals small biotechs got of greater than 50/50 but I'm pretty sure I could find lots of them at better than 15-20% given the circumstances. 15-20% royalty deals are the type of deals that are struck when a drug is partnered out in the early stages of development and the bigger partner in many cases shoulders virtually 100% of the development/manufacturing/marketing costs. Cholestagel is well into phase 3 development. It has a very good risk profile as far as odds of getting approval. I would guess that there's a chance that it could be manufactured either in the same Dow Chemical facility that is manufacturing Renagel or in an expanded facility. (It is made from the exact same base starting substance as Renagel). So your saying that GELX couldn't get as good a percentage deal on Cholestagel from a Merck or a Warner Lambert as they got on Renagel from Genzyme?? Personally I think they could, but hey that's just an opinion and I'm admittedly not all that well versed in these type of things. Sheese, *if* you are right; I'd take another 50% deal from Genzyme over a 15-20% deal from Merck. I mean geeze for three times the percentage it doesn't matter that your getting a lesser sales/marketing force because even if the Genzyme sales/marketing was pretty inept it wouldn't possibly be only one third as good as Mercks. At any rate I don't want to repeat myself too much here becuase I stated my reasons why I felt GELX could indeed cut an excellent deal with a big pharma in my last post. I still believe a deal in excess of 50% of profits is possible with a big pharma because of the way the field is layed out. I.E. (Merck and Warner Lambert would neither one (if they had any business sense) like to see the other get an exclusive deal for Cholestagel because of the very positive combo potential of Cholestagel with their multi billion selling Statin type drugs.) Ergo, Merck and Warner Lambert can be played off against each other for the best deal possible.
From the GELX 10-K....
130 patient study
"A low dose of Cholestagel administered with half the lowest recommentded dose of Lovastatin produced a 32-34% reduction in LDL cholesterol. This reduction was 50% greater than that achieved with low dose Lovastatin alone."
50%!!!!!! This is huge. There are many patients who can only tolerate low doses of Lovastatin, and the other statin type of drugs because of liver problems. People who are on these drugs are monitored for liver problems fairly closly. Therefore if adding Cholestagel improves the effficiency of low doses of these drugs by 50% then to me that is something that is very, very, significant and thus very valuable. The less you can take of a side effect causing drug the better. It shouldn't be too much longer before I'm proven right or wrong, but a deal with either Merck or Warner-Lambert or any other big pharma for a mere 15-20% would seem to me to be ludicrious given the circumstances of how effective Cholestagel is in combo form, and given the late stage of developement it's in.
>>> Further, the statin market itself is many fold greater (30X?) than the bile acid seq market, so there is literally no way a deal will be struck to your liking, at least involving a pharma giant. The drug is just not big enough.<<<
Just my opinion of course, but I think Cholestagel will wind up being a fair amount bigger than most people think. At present the Statin market is probably at least 40X bigger than the bile acid seq market. The 3 largest statin drugs had *worldwide* sales in excess of 5 billion in 96 and the bile seq's had U.S. sales of 111 million in 96.
However Cholestagel will without question expand the demand for the bile seq's. How much it will expand is a big question. Personally I feel it will at least double it because current bile seq's are really not very effective drugs. Typically with the current bile seq's you have to take 2-3 tablespoons twice daily with 8 ounces of water each time. Also the current drugs have "unpleasant intestinal side effects (such as constipation)" So given the vast superiority of Cholestagel to the current bile seq's I would think that it would decimate the current drugs. Perhaps taking over 90% of their sales. Sooooo... I see Chosestagel as being at least 200 Million dollar drug just as a stand alone drug. And that's not even including how much it's worth in combo therapy.
Hey.... up a point today:) Strike a good deal GELX!! :) |
