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Biotech / Medical : Regeneron Pharmaceuticals -- Ignore unavailable to you. Want to Upgrade?

To: rkrw who wrote (1113)	10/19/2006 10:33:46 AM
From: nigel bates	Read Replies (1) \| Respond to of 3559

No US rights at all ? Why didn't they buy REGN instead ? Unless they are taking a very pessimistic view of the US economy. <g>

To: rkrw who wrote (1113)	10/19/2006 10:06:48 PM
From: Miljenko Zuanic	Respond to of 3559

Yes, cost sharing is bit confusing. While it is global development plan, it may be necessary to repeat some trials (PI and PII) in ex-US territory that may drive cost beyond first projected scenario. REGN yet need to file IND in EU (maybe they will need PI/II), before they can start PIII. My view is that they will start multiple PIII in next +6 months, so there must be at least two different cost scenarios. Also, 50% repay over certain level indicate that at this time they do not expect “hardness” (for instance two identical PIII for single territory) for marketing authorization, but Bayer does not want to pay more than 25% of total cost if that scenario do not play out. Two/three things that surface from this deal: 1. Upfront, milestone and 50% cost reduction will enable REGN to continue current operation without needs to rise additional capital for 07/08. They still need to refinance $200 M note, but this can be done in mid/late-07 at ~$20/share or better (I guess). 2. Conserving US right give them option to make US deal (ophthalmic company with good marketing muscle) at later stage with much better economic (IF they can differentiate Trap from Lucentis). I never foresee REGN as COMERCIAL (marketing) company/operation. 3. global (ex-US): “jointly commercialize” and not “Co-promotion and Co-Commercialization” options/right. Are they STUPID? Why not settle for royalty on net sale? REGN-global company? Yes, right, only in Schleifer dream, after few drinks! Bottom line, deal is pretty good, and there is certain confidence at Bayer (Novartis has significant head-start in EU with Lucentis). Miljenko