It is time to discuss the positives I see from the press release.
"BioCurex will continue development of a chemiluminescence based serum RECAF test in its own facilities and The Licensee may resume research and development work and commercialize products incorporating the RECAF technology as per the original agreement."
Although the short term effect is the same, the license is actually not returned. It is in a state of suspension for Abbott only. Dr. Moro will continue working very hard to meet the criteria that Abbott wants to market the test. IMO, as stated in one of the latest filings, they are going to reduce the cost of the test and increase the shelf life of the reagents. We can also assume that Abbott is or will continue to attempt to sell its in-vitro division. For Biocurex, it is important that the license remain in effect because the new owner would obviously be interested in diagnostics or they would not buy the division. IMO, they would continue RECAF in a heartbeat.
"In consideration for the modification, BioCurex gained a higher royalty on any RECAF products that may be sold by The Licensee."
Because Dr. Moro will be doing all the work on the test, the royalty rate has probably been slightly increased.
"BioCurex also obtained the right to terminate the license at any time if The Licensee, following notice from BioCurex, does not agree within ninety days to new due diligence obligations for the commercialization of any products using the RECAF technology."
This one is very important. We currently have two licensees and since the agreement with IMA is also a semi exclusive, it would also have the same terms as the Abbott agreement. IMO, we have a third licensee coming onboard soon and that would leave no positions available. Dr. Moro has had other offers but has been selective. Now he can cancel the deal with Abbott and give that position to another company.
"Manual chemiluminescence and other colorimetric based RECAF tests are excluded from the semi-exclusive restrictions of the original agreement by a previous amendment. Thus, BioCurex may commercialize and license radioactive as well as non-radioactive manual tests to as many licensees as it deems appropriate."
Dr. Moro gained this right during the transfer negotiations to GE.
"The remainder of the original licensing agreement is ratified and affirmed and remains in full force and effect.
Dr. Moro, BioCurex CEO stated: "I believe that these amendments are fair and beneficial to both parties and better represent the interests and the relationship between our companies."
For the past couple of years, this has been a one sided deal with Dr. Moro doing almost all of the work anyway.
"We realize the significant market presence of this industry giant and therefore, in the past two years, we have worked very hard towards the conversion of the RECAF radio-immunoassay into a chemiluminescent format which is the industry standard for automated tests.
Initially, we encountered unexpected difficulties in our lab due to the unusual chemistry of RECAF, but we have solved them one by one. At this point, the tests work to our satisfaction and we are working closely with our second Licensee to expedite the transfer of our technology to their facilities."
By doing all of the work getting the commercial version ready for Abbott, Dr. Moro gained valuable knowledge that he can pass on to additional licensees. This test could be taken to trials just as it is. It attained fantastic results at the ISOBM.
"We are also finalizing a commercial version of our manual test (Serum-RECAF-M(tm)) which we plan to market for research purposes so that additional supportive data can be accumulated by independent research and clinical labs."
IMO, this one is indeed a very important one. This is not the RIA test he is talking about. It is a manual version of the Abbott automated test. It can be shipped and marketed for RESEARCH purposes WITHOUT FDA approval of any sort. It is being finalized and will undoubtedly give equal or better results that Abbott attained at the ISOBM.
So even though we are not happy about the latest news, there are some really good points. To summarize, they were a POS partner from the point they decided to sell the division. We can dump them in 90 days to get another partner onboard. The license remains effective if Abbott sells the division to someone really interested in diagnostics. Dr. Moro will soon finalize a chemiluminescent manual version of the test that could be run in any lab.
IMO, what we may see on Monday certainly will not be a true reflection of the value of this stock. Long term, the value remains.
