Replies to post #108853 on Biotech Values

[DewDiligence]

I think you expressed some bearishness when VRTX monetized a portion of its Telaprevir royalty stream and I totally agree with that.

Indeed I did; however, there’s a key difference between the Telaprevir case and the generic-Lovenox case: when VRTX monetized Telaprevir, it was in the midst of phase-3 trials and there could have been a skeleton in the closet with respect to safety.

I think it sends kind of a bearish signal. If you're confident in your drug, why limit your ceiling?

In the case of generic Lovenox, what does confidence in the drug have to do with anything? Lovenox is a big-selling drug and will continue to be a big-selling drug for many years. The only question is how much MNTA’s participation is worth; therefore, I would view a monetization of MNTA’s share of Lovenox as a strictly financial transaction with no particular inferences to be drawn about the future of Lovenox per se.

[10nisman]

Just because I think it sends kind of a bearish signal. If you're confident in your drug, why limit your ceiling? I think you expressed some bearishness when VRTX monetized a portion of its Telaprevir royalty stream and I totally agree with that. Clearly there's the benefit of a big chunk of cash up-front, which MNTA can put to use on the rest of its pipeline, but it also eliminates the generic Lovenox story which is such a key part of MNTA. Given that I'm confident in the future of MNTA's generic Lovenox, and I agree with you that TEVA won't be receiving approval for its own version any time soon, if ever, I'd prefer that MNTA retain its rights to generic Lovenox profits because I believe in the long run those profits will greatly outweigh any amount that can be received up front through monetization of those profits.

Bearish signal? The point of MNTA management is to maximize shareholder value and if they can obtain $20+/share today for its mLovenox revenue stream they would be foolish not too even if they have 99% certainty tLovenox will never obtain approval, IMHO. They could use the cash to pay a one-time special dividend ($6-8/sh) and use the remaining $14-16/sh on the balance sheet to develop and expand its pipeline while signing-up lucrative partnerships for M-118, FOB's, etc. IMO, it would be smart risk management by CW and team. Now if NVS is willing to pay $1 billion for mLovenox I would hope CW could negotiate selling all of MNTA for $2+ billion.

10nis

[jq1234]

as long as MNTA sticks to funding no more than 25% of the next Phase 2b trial of M118 with a partner

Why would a partner require MNTA fund 25% of phase 2b trial only? I took MNTA would not start phase 2b trial on its own as that they could fund phase 2b trial on its own if there would be a partner who would fund phase III. Funding a portion of phase III requires huge financial commitment from MNTA.