Avid Bioservices Inc (CDMO)

[Protector]

mojojojo, agreed. This part of SK's statement is based on feet-back of some kind of talks.

It may be somewhat impractical to maintain all U.S. rights and still get the partner and the deal terms you want.

They tried but the butter didn't melt.

This sentence is the possible way out solution that may have been suggested or defended by potential partners in talks.

But, it certainly is our goal, and at the very least we'd like to have some sort of a co-promotion at the end of this so we still have a significant upside in the future to look to as we continue to hopefully expand the indications in which bavituximab can be used and to pursue the 2nd-Line NSCLC aggressively.

One reasons for this reasoning was that we know for sure that Peregrine's BoD have/had a strong intend of going it alone and the above sentences is a 180 degrees turn. Keeping the U.S. rights has been EXPLICITLY mentions in the past by SK in combination with partnering the non-US.

Further more I think partners will want global rights because they are aware of all kinds of parallel import problems and the ease by which drugs can be transported inside economic communities without any control.

Finally partners will also want all indications because, as far as I understood it until now, bavi only varies in dosages but for the rest Bavi is bavi and if approved and available for condition A the same drug can be used for condition B if approved (and under the table if not (yet) approved).

So if multiple partners hold multiple rights what keeps the prescriber to use the Bavi from source A vs the Bavi from source B in the same dosage if it is the same liquid in the bottle.

In a field of partners this would create competition. Just assume there would be a Chinese partner that floods the market with bavi for a give condition but at Chinese prices (lic. Peregrine + cost + reduced profits). It would bring problems for every US or European partner who will have higher cost but same license fees per volume/dose (I guess) and would see its profits drop drastically if it wants to compete, if they even can.

So yes, I agree that SK's statements points in the direction of a global all conditions dealt, while that may not have been what they wanted but followed out of talks they had.

Peregrine's role will be, what they are best in, drive the Clinical Programs for the other conditions. They will for sure have some payments based on extending the conditions for which Bavi gets approved. And if they are smart they will not forget Avid in the process.

The above reasoning of course limits the possible partners unless they are not selling at the drugs full potential.

If I look at this from the perspective of the BPs then I am not sure I would want to miss out on this deal! Under the described conditions you only get ONE SHOT, no rematch! If Bavi is assigned to your competitor you are out. So if Peregrine knows how to handle the bidding process well then BPs have not so much maneuvering space to play price games.