Biotech Values

[zipjet]

>>One reason Teva is so aggressive with at-risk generic-drug launches is that Teva has insurance for the possibility of an adverse legal ruling (and potentially the awarding of treble damages).

>>As a % of the at-risk sales, how much do you think Teva has to pay for this kind of insurance?

That's a good one.

I have no idea. It would be an unusual company that would underwrite that one.

It also raises interesting legal questions that are beyond my limits. Is it an insurable risk? Is insurance in this situation against public policy? Would the policy be enforceable? Would the existence of such a policy be grounds for additional damages in the nature of punitive damages? Could the "policy" take the form of a derivative or a limited partnership to avoid discovery and any legal implications that might arise if it was a true insurance policy?

I doubt that even scratches the surface of the issues that a company would have to satisfy to engage in the deal on an informed basis.

Any company that engages in that form of risk transfer should not let it be known, IMO.

ij