I'm quite happy for you to think I'm also gbr with great posts like that Ramses but I'm afraid I don't have the creative artwork skills he also exhibits to pull off your multi-nic conspiracy theory ;) ___
Great blog investorpaul - has popped up on the search engine many times and you must also be complimented on the prompt updates made to it proceeding OBJ announcements. ___
Excellent post GBR,
A qualitative analysis is the only reliable method for valuating a biotechnology company. You have covered this beautifully imo.
Although it still remains to be factored in to the true value of the sp the importance of Big Pharma funded Drug Delivery Enhanced Product (DDEP) programs has been discussed here many times but another correlation to measure the importance of Big Pharma funded partnership programs is the approval percentage rate for DDEP's developed by Big Pharma:
Over the past 11 years from 2000 to 2011 only 6 companies have accounted for over 60% of ALL DDEP approvals. Perhaps even more surprising is that global giants Eli Lilly and Roche don't even make it in the top six with a total of only 3 and 2 approved DDEP respectively in the last 11 years.
The good news for OBJ is that GlaxoSmithKline remains in the #1 position for all FDA DDEP approvals:
DDEP Approvals by Company – Big Pharma
"A total of 80 companies were responsible for the 235 DDEP approved over the last 11 years. The leading company in terms of approved DDEP was GlaxoSmithKline with a total of 13 approved DDEP. The largest part of this portfolio was related to internal projects initiated through one or more of their subsidiaries.
Pfizer was a close second with 12 FDA approved DDEP. This figure may surprise some as Pfizer is not usually associated with a major drug delivery initiative and DDEP portfolio. The answer is that many of these DDEP have been contributed by companies they have acquired over the last decade, notably Pharmacia & Upjohn and Wyeth. This total does not include DDEP that were added to their portfolio as a result of the acquisition of Specialty Pharma companies.
A list of Big Pharma companies with three or more DDEP is presented below. Abbott and J&J, companies known for their drug delivery capabilities are tied for 3rd. Lilly and Roche are notable in being lower in the list with 3 and 2 approved DDEP respectively."
GlaxoSmithKline - 13.6% Pfizer 12.5% Merck 10.4% Abbott 8.3% Johnson & Johnson 8.3% AstraZeneca 7.3%
The quick take away is that a company should budget about $20 million in direct costs to conduct a Phase I and II program for a drug delivery product that has the potential to reach approval. Direct costs in this case include amounts paid to third party providers and suppliers as well as internal costs directly related to conducting the development program. It would not include general overhead, management supervision and facility expenses.
Direct Phase III development costs seem to run in the range of $60 to $70 million. This is a much higher figure than most companies expect when they enter into the development process. (It may also help explain why there is such a low Phase II to Phase III transition rate).
Without adequate funding these expenses are beyond the reach of most drug delivery companies. Two approved pulmonary products had Phase III only development costs of about $100 million dollars in 2009.
Whilst the pessimist might say, "Boy, these statistics don't really favor our own internally funded Musculoskeletal Pain Patch ever being granted final approvals..."
The optimist would say, "I wonder which one of our other Big Pharma funded programs might soon be triggering a major milestone payment for our budget-tight board to be so confident in announcing the commencement of an internally funded $100 million dollar pain patch development program...?" ___
The Wellcome Trust have just released the following achievements for 2011 as this year marks their 75th Anniversary:
(20min delay)