Biotech Values

[mcbio]

Re: in-licensing

MDCO’s CC re in-licensing of PFE’s ApoA1 Milano was notable in that MDCO’s executives could be heard openly laughing at some of the CC questions. Worth a listen, IMO, for entertainment value as well as investment value.

Speaking of in-licensing, I believe we had a general discussion on in-licensing before in connection with our discussion on the dismal record of virtual biotechs. I am normally pretty skeptical of in-licensed drugs inasmuch as I question why, if a drug were particularly promising, big pharma would give up the rights to a smaller company. I know there may sometimes be some valid reasons (e.g., drug no longer fits big pharma's strategic focus), but generally speaking I'm pretty skeptical about the prospects of in-licensed drugs. I'm not sure if you share that same general skepticism or not. But, I am very curious about a further distinction between drugs in-licensed from big pharma versus those that are in-licensed from universities. I ask because I'm doing a little further digging into ZIOP, who in-licensed their lead compounds from the UT M.D. Anderson Cancer Center and Texas A&M back in 2004 (see: http://ir.ziopharm.com/releasedetail.cfm?ReleaseID=200258 ).

I would think there would be fewer reasons to be skeptical of compounds in-licensed from universities inasmuch as these entities generally have to partner their prospective drugs with someone due to lack of resources. Big pharma of course generally doesn't have resource issues to further develop a drug. I guess you could presumably make the argument that big pharma likely had a chance to in-license the ZIOP drugs from UT/Texas A&M in exchange for presumably better terms than could be provided by a much smaller biotech like ZIOP. I'm just a little curious about your thoughts on the chances of success for in-licensed compounds in general and specifically those that are in-licensed from big pharma versus those in-licensed from universities.