Biotech Values

[DewDiligence]

Re: GTCB ATryn partnership

A few quick comments:

1. Without knowing the even the approximate royalty rate on ATryn sales (which hasn’t been disclosed), it’s impossible to ascertain whether this is a good deal or a bad deal from GTC’s perspective.

2. The cumulative potential milestones of $73M are not bad for a drug like ATryn; however, much of this $73M may be geared to milestones that will be difficult to reach, such as outsized sales thresholds and approvals in one or more indications of acquired antithrombin deficiency such as burns. It seems that only the first $5M -- $2M up front and $3M for ATryn approval in the EU -- is assured or nearly assured.

3. This deal all but assures that GTC won’t need to conduct another PIPE before the EMEA’s opinion on ATryn in February, but this was something I had assumed anyhow.

4. GTC remains in sole control of the ATryn program in the U.S., which is slated for a BLA submission in late 2006. As there is no antithrombin product in the U.S. that is available on a regular basis, I would expect the economics of selling ATryn in the U.S. to be more robust than the economics in the rest of the world. Hence, a potential partnership for ATryn in the U.S. ought to be considerably more lucrative than the deal announced today for Europe, the Middle East, and Canada.

5. It’s nice to see GTC make good on its recent promise to ink a partnership deal by year-end.

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Bottom line: I would like to know more of the economic details—especially the approximate royalty rate on sales—before passing judgment on the deal. Whether this will be possible from GTC’s SEC filings or other information sources remains to be seen.