GTC Biotherapeutics (fka GTCB)

[DewDiligence]

We can put to rest the worst-case scenarios about Merrimack. We know that the MM-093 program remains viable because, if it were not, GTC would be required under GAAP to recognize all deferred revenue attributable to the program as revenue in the current reporting period.

Moreover, GTC took in approximately $1.3M in cash from Merrimack during 3Q06, including amounts classified as current revenue (~$0.6M) and amounts classified as deferred revenue (~$0.7M).

The distinction between currently-recognized revenue and deferred revenue is an accounting artifact. However, this artifact can sometimes provide a window into the status of a program that might otherwise not be possible.