Hi Davis,
Good to see you are still here. I just thought I'd post the details of Techniclone's licensing agreement with Schering. Just taken from the quarterly report, but I'm sure a lot of people don't actually read through it that thoroughly...
My understanding is that if LYM-1 progresses through the clinical trials as we all hope and is eventually approved, Techniclone stands to receive cash payment of $17,000,000, of which it has already received $3,000,000. The rest is payable upon the achievement of certain milestones in the approval process.
Once approved, Techniclone will also receive a royalty equal to twelve percent (12%) of net sales of Oncolym(R) products worldwide.
The relevant portion of the latest 10-Q is posted below:
Also on March 8, 1999, the Company entered into a License Agreement with Schering AG, Germany. Under the terms of the agreement, Schering AG, Germany was granted the exclusive, worldwide right to market and distribute LYM products in exchange for an initial payment of $3,000,000 which the Company received upon execution of the agreement, a further payment of $2,000,000 following the acceptance by the FDA for filing of the first drug approval application for Oncolym(R) in the United States, a further payment of $7,000,000 following regulatory approval of Oncolym(R) in the United States and two final payments of $2,500,000 each following regulatory approval of Oncolym(R) in any country in Europe and upon the first commercial sale of Oncolym(R) in any country in Europe. The Company will also receive a royalty equal to twelve percent (12%) of net sales of Oncolym(R) products (which is subject to reduction, on a country-by-country basis, to six percent (6%) if there is a generic form of the Oncolym(R) product being sold in such country), which may be reduced by one percentage point if the FDA does not consent to an extension of the existing Phase II trials of Oncolym(R) as a Phase III clinical trial by June 30, 1999. Pursuant to the terms of the agreement, the Company is required to pay for all pre-clinical expenses up to $500,000 incurred after March 8, 1999, and fifty percent (50%) of all such expenses incurred in excess of $500,000, with the other fifty percent of such expenses to be paid by Schering AG, Germany. The Company is also required to pay for twenty percent (20%) of the clinical development expenses and existing trial expenses associated with Oncolym(R), and Schering AG, Germany is required to pay for the other eighty percent (80%) of such expenses. Each party will pay for all of its internal costs relating to existing trials. Pursuant to the agreement, the Company and Schering AG, Germany have also agreed to a structure for proceeding with negotiations concerning the terms of a possible licensing of the Company's VTA technology in the near future. The continued effectiveness of the agreement with Schering AG, Germany is subject to certain other conditions and may be terminated by Schering AG, Germany if (i) there are issues of safety or patient tolerability, (ii) Schering AG, Germany determines in its reasonable scientific or business discretion prior to receiving regulatory approval that the Oncolym(R) product is not acceptable for reasons of efficacy or risk/benefit therapeutic ratio, (iii) the FDA does not permit the extension or conversion of the Phase II trials of Oncolym(R) as a Phase III clinical trial by June 30, 1999, (iv) Schering AG, Germany determines, using its reasonable judgment based on data from or the results of the first Phase III clinical trials of Oncolym(R) that such results do not support the submission of Oncolym(R) for regulatory approval, (v) the Company fails to deliver or it becomes reasonably clear that the Company will fail to deliver in time appropriate quantities of clinical supplies of antibody or Oncolym(R) product such that the clinical development of Oncolym(R) will be delayed by three (3) months or more, (vi) if the Company has not concluded a definitive agreement providing for a radiolabeling site for the production of Oncolym(R) products by September 1, 1999, or (vii) at any time after receiving regulatory approval upon twelve months notice to the Company. However, if the agreement is terminated by Schering AG, Germany due to issues of safety or patient tolerability, or Schering AG, Germany determines in its reasonable scientific or business discretion prior to receiving regulatory approval that the Oncolym(R) product is not acceptable for reasons of efficacy or risk/benefit therapeutic ratio or determines, using its reasonable judgment based on data from or the results of the first Phase III clinical trials of Oncolym(R), that such results do not support the submission of Oncolym(R) for regulatory approval, Schering AG, Germany will remain obligated to pay for 80% of the non-cancellable third party costs in regard to clinical trials underway at the time of such termination, up to $1,500,000 (other than a termination after receiving regulatory approval). Schering AG, Germany may also terminate the agreement upon thirty days' written notice given at any time prior to receiving regulatory approval, but will remain obligated to pay for all of the costs of completing all then ongoing clinical trials for Oncolym(R), up to $3,000,000.
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So that's where we stand on the LYM-1 front.
Tarken
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