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Biotech / Medical : Cadus Pharmaceutical Corp. (KDUS) -- Ignore unavailable to you. Want to Upgrade?

To: scaram(o)uche who wrote (21)	8/3/1999 6:14:00 PM
From: scaram(o)uche	Respond to of 1833

>> Woler needs to clarify.... what does this mean? << what a sloppy mess, given that there's been a milestone payment..... here's the relevant part of the 10-K....... The SmithKline Beecham Collaboration In February 1997, the Company entered into a drug discovery collaboration with SmithKline Beecham. During the term of the research collaboration, which expires in February 2002, the Company will seek to identify ligands and to elucidate the function of orphan G Protein-coupled receptors included within the collaboration and create high-throughput screens to discover small molecule agonists and antagonists to these receptors. During the term of the research collaboration, SmithKline Beecham is required to provide the Company with research funding of $3.0 million each year, adjusted for inflation, and certain other payments. From February 1997 through February 1999, SmithKline Beecham paid the Company approximately $6.5 million in research funding and a one-time $2.0 million technology development fee. SmithKline Beecham is also required to make payments to the Company upon the achievement of certain research milestones and upon the achievement by SmithKline Beecham of certain drug development milestones. In January 1999, the Company achieved its first research milestone in the collaboration and received a $1.0 million payment for such milestone. SmithKline Beecham is also required to pay the Company royalties on the sale of drugs developed through the 16 <PAGE> use of the Company's drug discovery technologies. The Company has co-promotion rights in North America for certain products that may result from the collaboration and rights to certain potential products that SmithKline Beecham may choose not to develop. There can be no assurance that the collaboration will result in the development of any drugs. SmithKline Beecham has the right to extend the term of the research collaboration for between two and five years by notice to the Company given prior to February 25, 2001. SmithKline Beecham has the right to terminate the research collaboration (i) after August 25, 1999 if the Company fails to meet certain scientific objectives in connection with the conduct of the research collaboration or (ii) if the Company fails to perform its obligations in the conduct of the research collaboration in any material respect and does not cure such failure within a period of 60 days after receiving notice thereof. In the event of such termination, SmithKline Beecham has no further obligation to provide the Company with funding for the research collaboration. There can be no assurance that the Company will be able to timely meet such scientific objectives or that the collaboration with SmithKline Beecham will be extended.