I agree, there are flaws in the “removes the buy
Post# of 154033
(Total Views: 415)
Posted On: 11/03/2019 8:00:22 AM
I agree, there are flaws in the “removes the buyout possibility” assumption. This partnership makes this drug a commercial reality, which will create the real value we have all been waiting for.
Second, if there is one partner that has this sweet deal and therefore no desire to buy the whole enchilada, what about all other companies looking at this drug? They don’t just go away. In fact, I believe they are now in the position that they have to buy out the company because they can’t top this deal. As soon as the pharma world realizes the market this drug is going to take just in HIV, they will have to move either to protect their current market or to protect their future pipeline. Fear is a much stronger emotion than desire, BP will soon be afraid of the questions from their shareholders about why they missed this. They will have to act.
Imagine GILD quarterly earnings call where they announce their market share declined because of some tiny company’s drug. The next quarter they will need to answer the same question only with and accelerated loss in market share. CEOs lose their jobs over these things. This scenario could be the 3rd quarter of 2020, but GILD will see the numbers as soon as this is being prescribed. They will know a patient on their drug is now also on leronlimab and soon only taking leronlimab.
Whoever the partner company is, I feel it is likely they do not have the capitol to buy this out, this deal is the best they can do. BP can buy this out, and it will be when the impact on the drug market is known.
Second, if there is one partner that has this sweet deal and therefore no desire to buy the whole enchilada, what about all other companies looking at this drug? They don’t just go away. In fact, I believe they are now in the position that they have to buy out the company because they can’t top this deal. As soon as the pharma world realizes the market this drug is going to take just in HIV, they will have to move either to protect their current market or to protect their future pipeline. Fear is a much stronger emotion than desire, BP will soon be afraid of the questions from their shareholders about why they missed this. They will have to act.
Imagine GILD quarterly earnings call where they announce their market share declined because of some tiny company’s drug. The next quarter they will need to answer the same question only with and accelerated loss in market share. CEOs lose their jobs over these things. This scenario could be the 3rd quarter of 2020, but GILD will see the numbers as soon as this is being prescribed. They will know a patient on their drug is now also on leronlimab and soon only taking leronlimab.
Whoever the partner company is, I feel it is likely they do not have the capitol to buy this out, this deal is the best they can do. BP can buy this out, and it will be when the impact on the drug market is known.
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