>the license agreement in the 10-k is worded poorly then<
I inferred that there were sales-based milestones from the fact that there are five unspecified milestones (with redacted amounts) specified in the 10K:
(A) Data from a Phase I/IIA Clinical Trial demonstrates US$25 million that NM-283 is safe and effective. (The Parties acknowledge that this amount has been paid prior to the Amendment Effective Date.)
(B) [**] $[**]
(C) [**] $[**]
(D) [**] $[**]
(E) [**] $[**]
(F) [**] $[**] <<
Normally, you don’t see this many milestone steps for regulatory milestones alone for a single compound; however, after rereading IDIX’s 3/29/06 PR, I agree with you that the $455M comes entirely from regulatory milestones. Thank you for pointing out the error.
This doesn’t change my view that the HBV market alone will support a considerably higher stock price and that anything IDIX achieves in the HCV market is icing on the cake. Regards, Dew
Goldman Sachs excerpt on IDIX from 5/18/06 (c/o quidditch on SI). Makes an interesting companion read with #msg-11329859.
>> We continue to expect FDA decision on Telbivudine for HBV ($0.5B) in late 2006 [the PDUFA date is in October]. …We estimate the sales potential is over $0.5B worldwide. [This is an extremely conservative forecast; they presumably mean the U.S.+Western Europe (rather than worldwide) because NVS owns the rights to Telbivudine elsewhere.]
Assuming an industry sales multiple of 5X, peak sales of $0.5B in 2010, 50% share with Novartis and 15% discount rate, the present value of Telbivudine is about $13.40/share. [This excludes the sizable amount of cash on hand as well as the value of the NM283 program in HCV, which could be worth as much as $500M in clinical (start of phase-3) and regulatory milestones.] <<
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