Sharga: enuff on the "tclt" royalties. Book authors get royalties, inventors get royalties. These they recieve whether or not the publisher makes money on the sale of a book or not - its a per unit percentage set out in a contract.
Inventors royalties vary depending on the stage of product development. In this case Stan had it going on. He not only created a useful and successful product in demand but already had a manufacturer and sales. My guess is Stan's royalties might run as high as 20% which would leave tclt with 80% out of which they would have to pay Sportspharm production and packaging costs. The remaining monies are tclt's and the taxmans.
Its one thing to say neosporin sells rather cheaply in comparison, but is there a true comparison in product competition? HOw many other products can do the same thing as Neosporin and work just as well? Neosporin must remain competitively priced or folks will just pick up another brand.Me, I'd rather pay the extra buck or two and know what I have works.
SRO as I understand it is kind of unique in product category (without peers) and more so is very effective. Another factor to pricing is that it is specifically targeting a segment of the population, and not going for "blanket" coverage, meaning that their audience is currently a fraction of market potential.
For the ordinary citizen, a blister is nothing more than a minor annoyance. However for soldiers putting their life on the line and multi million dollar pitching arms, that 35 bucks per tube may be mighty cheap.
Notice also that in the licencing agreement, manufacturing is not part of the picture. Chances are that the manufacturing rights lies within the embrace of Sportspharm or remains under Stans control.
While operating within the confines of a specialized market the price of SRO will remain high. Once approved for OTC sales, the price should come down to a more reasonable level.
Also remember that we have licenced two products and not just the one.
Hope this helps. P.
AI
