Biotech Values

[DewDiligence]

IDIX: Guessing the IDX899 Milestones from GSK

[Updated for receipt of $6.5M milestone from GSK on 4/23/10.]


The events that trigger IDX899 milestone payments from GSK to
IDIX are set forth in IDIX’s 2008 10-K report; although the sum of
these milestone payments is known to be $416M (#msg-35391933),
the amount of each individual payment is redacted in the SEC filing.

On 4/23/10, IDIX received a $6.5M payment from GSK for achieving
unspecified preclinical milestones (#msg-49507158); I surmise that
this $6.5M amount is the aggregate of all of the preclinical milestones
in the program; if this is correct, the remaining potential payments
of $409.5M (416M-6.5M) are derived entirely from clinical, regulatory,
and commercialization milestones.

The numbers below are my guesses for the individual milestones,
based on the way similar licensing deals have been structured.
These numbers could be off, of course, but I think they are accurate
enough for investment purposes. (Feedback welcome.)

http://sec.gov/Archives/edgar/data/1093649/000095013509001542/b73455ipexv10w28.htm [page 20]


Preclinical milestones:

[Guess: $6.5M all told, the amount actually
received by IDIX from GSK on 4/23/10.]

• Completion of the monotherapy formulation.
• Completion of a single-pill combination formulation.
• Completion of a segment II reproductive toxicity study.
• Completion of a six-month rodent chronic toxicology study.
• Completion of a nine-month non-rodent chronic toxicology study.
• Completion of a rodent carcinogenicity study.


Clinical milestones:

[Guess: $32.5M all told.]

• First patient dosed in a phase-2 study of IDX899 + HIV backbone regimen (e.g. Truvada) with a duration of at least 24 weeks. [Guess: $12.5M.]

• First patient dosed in a phase-3 study. [Guess: $20M.]


Regulatory milestones:

[Guess: $87M all told.]

• FDA acceptance of NDA for review. [Guess: $15M.]

• EMEA acceptance of MAA (NDA) for review. [Guess: $10M.]

• Japanese acceptance of NDA for review [Guess: $5M.]

• FDA approval for marketing [Guess: $45M.]

• Japanese approval for marketing [Guess: $12M.]


Commercialization milestones:

[Guess: $290M all told.]

• First commercial sale in a major country. [Guess: $40M.]

• Three sales-based milestones based on attaining specified thresholds of worldwide sales. [Guess: $50M, $80M, and $120M, respectively—i.e. $250M in all—for the low , middle, and high sales triggers.]