Dear WMHB, thanks for another thoughtful and well written post.
You made the comment that 'the aforementioned drugs, who in many instances are facing the tumultuous patent cliff' the implication being that the financial consequences for the BPs that own those drugs, particularly Merck who own Keytruda, will be quite savage. The word that I get from well placed industry insiders is that yes, the price of Keytruda will come down, but by nowhere as much as you might think. One of the reasons posited that this might be the case is that the new alternative providers will look to capture as much margin as possible by marketing at a discount of say 15% to 20%, and of course thereby achieving high returns as well. Over time, we know that margins will be competed away, but the view is that none of the players will be in a hurry.
The combined market capitalization of the 3 pharmaceutical companies that own the oncological drugs mentioned above is around A$910 Billion. To paraphrase Kerry Packer (when talking about Australia's Big Four banks and how you might compete with them), "you take on these big gorillas at your own risk, and the risks are scary". I think what that means for we, the long suffering, and extraordinarily patient Imugene shareholders***is that if we are to benefit commercially to somewhere near the extent that your assessment implies we might, we will need seriously credentialled, market savvy operators in our corner. The ridiculous saga of Covid in most of the Western world demonstrated just how far BPs will go to in pursuit of mega-revenue, and mega profits. It can be a very brutal and very vicious world out there and Leslie Chong's assertion that if you "look after the science, the money will come" is wrong.
To the best of my observation, Imugene is radically un-equipped to take on the commercial challenge, and certainly the company's results so far support this assertion. Without being disrespectful, Warren Buffet's observation that you don't hire guys that catch the train to work to cut the deals is very pertinent here. Imugene needs in its corner a senior individual who operates at the highest levels of pharmaceutical merchant banking (undoubtedly very expensive). Preferably, Monil Shah would stay on the team and report to him/her.
DYOR, MY OPINIONS ONLY
***(never mind the poor souls who in different circumstances might be benefiting from our immunotherapy drug tech as we speak)
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