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Biotech / Medical : Immunomedics (IMMU) - moderated -- Ignore unavailable to you. Want to Upgrade?

To: patlawche11 who wrote (47142)	8/24/2018 7:02:48 PM
From: Labrador	Respond to of 63283

The Cash Balance Slide #36 is somewhat misleading as I would view the "sale of future royalties" as a liability (or certainly worthy of mention). IMMU borrowed $175M against future revenues where they've committed to make royalty payments. I did not pull the Funding Agreement to know the terms. From their June 30, 2018 10-K (pages 63-64) Liability related to sale of future royalties: On January 7, 2018, the Company entered into a funding agreement (the "Funding Agreement") with RPI Finance Trust, a Delaware statutory trust ("RPI"). Pursuant to the Funding Agreement, the Company issued to RPI the right to receive certain royalty amounts, subject to certain reductions, based on the net sales of the ADC sacituzumab govitecan (the "Product"), for each calendar quarter during the term of the Funding Agreement ("Revenue Participation Right"), in exchange for $175.0 million in cash (the "Purchase Price"). Specifically, the royalty rate commences at 4.15 percent on net annual sales of up to $2.0 billion, declining step-wise based on sales tiers to 1.75 percent on net global annual sales exceeding $6.0 billion. The carrying value of liability related to sale of future royalties at June 30, 2018 is approximately $202 million.