Your concern is legitimate, but not likely for the
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Posted On: 04/16/2018 7:09:13 PM
Your concern is legitimate, but not likely for the following reasons.
1. With multiple blockbuster drugs coming off patents, BPs are under pressure from shareholders to replenish pipeline with new drugs. There are many articles on that.
2. The math doesn't make sense. Let's say a BP plans to wait five years for a fire sale instead of investing $1B (hypothetical) to partner B now. That means the BP would miss five years of revenues. If the annual sales is $1B, that's $5B of revenues missed just to save $1B.
3. This strategy only works when there's no competition. Similar to eBay, you can wait for the seller to lower the price for an item. The risk is if another person also wants the item, it could be sold before the price drops.
1. With multiple blockbuster drugs coming off patents, BPs are under pressure from shareholders to replenish pipeline with new drugs. There are many articles on that.
2. The math doesn't make sense. Let's say a BP plans to wait five years for a fire sale instead of investing $1B (hypothetical) to partner B now. That means the BP would miss five years of revenues. If the annual sales is $1B, that's $5B of revenues missed just to save $1B.
3. This strategy only works when there's no competition. Similar to eBay, you can wait for the seller to lower the price for an item. The risk is if another person also wants the item, it could be sold before the price drops.
Quote:
The thing of concern here is BP is starving the company to death in hopes of fire sale.
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