Replies to post #125903 on Biotech Values

[mcbio]

Re: Most likely FoB partners for MNTA

Excellent post Dew. And shame on me for thinking you had forgotten about my question. ; )

With regards to PFE and the potential exclusion of Enbrel from an FoB partnership, isn't it conceivable that if PFE believes there will ultimately be other Enbrel FoBs anyways, that they would want to be involved with their own Enbrel FoB so that they can participate as well? Conversely, if PFE were to believe that only MNTA had the capability to produce an Enbrel FoB, is it still conceivable to think that PFE might want to be involved in such a product insofar as they would still derive all the revenue from both Enbrel and the Enbrel FoB and the Enbrel FoB might be able to better compete with other drugs that would otherwise potentially be used in place of the branded Enbrel. I.e., perhaps PFE might in total derive greater revenue from a combo of branded Enbrel plus an Enbrel FoB than just the branded Enbrel alone.

[NP1986]

What about Eli Lilly? Following their acquisition of ImClone, wouldn't they meet the first criterion?

[acgood]

Most likely FoB partners for MNTA

Thanks for posting this, as it is something I give thought to also...

First, I agree that PFE is the most likely partner. I think they would put the FOB programs in their Established Products division (or spinoff if that were to occur). And MNTA might be willing to sacrifice one particular product (Enbrel) to get the broad platform deal with strategic alignment.

SNY is an interesting one...a deal with MNTA would represent an impressive display on management vision and focus to set aside the Lovenox "defeat"

MRK: I agree the con you list seems to large. They've stated they are working on Enbrel, Neupogen, Neulasta. I think we can all agree that one can't really take a biosimilar enbrel program and "convert" it into a MNTA style characterization. True biogenerics would have to start from scratch or at least backtrack greatly. Or, the MNTA programs would have to be completely distinct - and I question whether such parallel investment would be prohibitive (or merely unpalatable)

NVS: I still hold out the possibility that NVS will come around after they realize/decide that the European model will 1) not be that profitable and 2) will preclude substantial economic success in US (and would seem to require NVS salesforce to promote Sandoz biosimilars)

So do I take it that your assigned probabilities to a Roche or Amgen deal is nil or close to?

[DewDiligence]

Musings on SNY’s Investor Day webcast next week:

http://finance.yahoo.com/news/Sanofi-presentation-a-trigger-rb-3990975055.html?x=0&.v=1

Link to webcast and slides (when available):
http://en.sanofi.com/investors/events/corporate/2011/2011-09-06_ir_strategy-outlook.asp

[jq1234]

I would add LLY and AZN to the list.

[DewDiligence]

Most Likely FoB Partners for MNTA

[Revised for new Enbrel patent, which eliminates a contrary argument for PFE.]


From MNTA’s perspective, the main criterion for an FoB partner is (IMO) the partner’s ability to manufacture and commercialize a biologic without engaging a third party. There’s a non-trivial risk of IP theft in any kind of FoB partnership, so it’s best to limit MNTA’s IP exposure to only the partner rather than the partner and a third party.

Companies that meet the above criterion and have publicly expressed an interest in FoB’s include the following, listed in order of highest to lowest likelihood (IMO) for partnering with MNTA:


• PFE. Pro: An aggressive stance with respect to business development. Con: None. In the previous version of this analysis, I cited PFE’s partial ownership of Enbrel (which is shared with AMGN) as an argument against PFE , which was based on the notion that Enbrel was one of the most promising biologics for developing an FoB. However, AMGN’s newly issued Enbrel patent (#msg-69265200) would seem to take Enbrel out of the equation for any of MNTA’s prospective FoB partners, so there is no longer a company-specific downside for PFE.

• SNY. Pro: An aggressive stance with respect to business development and respect for MNTA’s technology arising from an understanding of how difficult it was for MNTA to reverse-engineer branded Lovenox. Con: SNY has some branded biologics (including those from Genzyme) that could cause management to worry about cannibalization from FoB’s.

• MRK. Pro: No branded biologics, and hence no sales placed at risk from a broad FoB partnership. Con: Strategic alignment—MRK appears to be pretty far along in its plan to seek US approval of FoB’s using the conventional BLA pathway.

• NVS. Pro: Respect for MNTA’s technology and scant involvement with branded biologics that could be put at-risk from FoB’s. Con: Strategic alignment—NVS has publicly stated its intention to pursue non-substitutable FoB’s, where there is less need for MNTA’s reverse-engineering technology than there is with substitutable FoB’s.

JMHO, FWIW