Replies to post #127958 on Biotech Values

[exwannabe]

On 2), I envision that 100% of the hypothesized 20% royalty on Amphastar’s sales goes to MNTA. The patents in question belong to MNTA, not the NVS/MNTA JV; moreover, post-2014, NVS benefits indirectly by keeping a larger proportion of the NVS/MNTA JV’s profits.

I agree with the 100% to MNTA, but based on your second argument.

NVS does have an exclusive license on the patents, thus the fact that MNTA owns them does not matter.

[iwfal]

Dew - Thanks. Perhaps not coincidentally (-g-) such a 20% royalty would probably be considered close to 'fair' by Sandoz as well:

Under current conditions:

Momenta gets about 0.5(Market share of mL)x0.68(GM)x0.45=15.3% of total lovenox market

Sandoz gets about 0.5 (Market share of mL)x0.68(GM)x0.55=18.7%

Sandoz vs Momenta ratio = 1.22


Under conditions of T and A giving 20% royalties:

Momenta gets 0.2(MS for each mL)x0.11 (Royalty on mL)+ 0.2*0.2+0.2*0.2=10.2% of total lovenox market.

Sandoz gets about 0.2 (MS of mL)*0.63 (reduced Gross Margin due to lower volumes - 0.11*20=10.4% of total lovenox market share.

Sandoz vs Momenta ratio=1.02

[zipjet]

, I envision that 100% of the hypothesized 20% royalty on Amphastar’s sales goes to MNTA. The patents in question belong to MNTA, not the NVS/MNTA JV; moreover, post-2014, NVS benefits indirectly by keeping a larger proportion of the NVS/MNTA JV’s profits.

It is not clear to me that NVS/Sandoz has no interest in the patents - they sued on them. Nor does it make sense to enter into the JV without contemplating IP that may later reduce to patents that protect the JV.

The other side of this one is the seeming lack of quid pro quo on the profit split dropping to a royalty on launch and not reverting on a PI.

This is all a bit confusing to me.

I am surprised that the TRO issued - it was NOT expected by me - and it has to indicate some tentative conclusion by the judge of the right of MNTA to injunction.

ij