I stumbled into this on LinkedIn. Thoughts on deal-making from a Senior Vice President from Merck, Yariv Hefez. Head Global Business Franchise Oncology. Posted three days ago. Lots of bearing on our discussions of leverage and how our negotiations for some kind of deal may play out. Presented in it's entirety:
The Uncomfortable Truth
"Three years ago, I grabbed coffee with a biotech founder a couple of days after she signed a nine-figure deal. Five big pharma players. Clean data. Bankers running a flawless process. Offers kept climbing, higher upfronts, better royalties, tighter milestones.
On paper, the top bidder should have won easily. She picked someone else. When I asked why, she just smiled and said:
"When the Phase 2 data inevitably wobble, and they will, I know exactly who I want sitting next to me."
That line explains more about pharma partnering than most strategy decks ever will.
We love saying "pharma partnering is all about relationships."
But let's be real, most deals don't feel like that at all.
Once the data room opens and advisors are circling, everyone is looking at the same numbers. Models converge fast. Differentiation disappears.
And suddenly the whole conversation is upfronts, milestones, royalties, co-comm rights, all crucial, but mostly financial engineering.
The uncomfortable truth:
Show up late, and you're mostly competing on economics.
Show up early, before the story is polished and the risks are neatly packaged and you're competing on trust.
In biotech, where things go sideways all the time, trust is the shortcut nobody talks about enough. Negotiations lighten. Diligence gets honest. Risk-sharing turns creative instead of defensive.
Founders aren't just running spreadsheets. Deep down they're asking:
"Who do I actually want next to me when the data wobbles?"
That's why the moves that matter most usually happen years before the banker ever shows up.
Timing > capital.
Some still don't get it.
The best deals aren't won in the data room.
They're earned quietly, long before anyone's keeping score."
Well, it’s not too hard to imagine Dr Lalezari in this kind of scenario, working out a deal based on trust and, dare I say, shared values? Competing on trust. Frankly, I think this kind of mind-set is made easier, or enabled, or enhanced, by the huge numbers to divvy up… We are fortunate that it’s a big pie, and there is a lot to go around. So there is that. But let the details fall into place, let the financial engineers do their thing and leverage what they can. More than likely, Cytodyn already knows who they want sitting beside them. Despite our speculations, despite the obvious suspects and the numbers.
Don’t get me wrong—the financial details are “crucial,” and Hefez makes that point. For the sake of a decent retirement, I want Hoffman to be at the top of his game. But in this sideways world, I’ll take some solace in the words of one of Merck’s best and brightest. Not that I think Merck is gonna be our Big Daddy or anything… In fact, this has reinforced my feeling in the ViiV/Max/GSK connection, because of the history and personal vibes there. Or some Euro connection, anyway. The cultural fit seems better. However it plays out, reading that post made the secular humanist in me feel much better.
https://www.linkedin.com/posts/yarivhefez_The...2112-7IZJ/
The Uncomfortable Truth
"Three years ago, I grabbed coffee with a biotech founder a couple of days after she signed a nine-figure deal. Five big pharma players. Clean data. Bankers running a flawless process. Offers kept climbing, higher upfronts, better royalties, tighter milestones.
On paper, the top bidder should have won easily. She picked someone else. When I asked why, she just smiled and said:
"When the Phase 2 data inevitably wobble, and they will, I know exactly who I want sitting next to me."
That line explains more about pharma partnering than most strategy decks ever will.
We love saying "pharma partnering is all about relationships."
But let's be real, most deals don't feel like that at all.
Once the data room opens and advisors are circling, everyone is looking at the same numbers. Models converge fast. Differentiation disappears.
And suddenly the whole conversation is upfronts, milestones, royalties, co-comm rights, all crucial, but mostly financial engineering.
The uncomfortable truth:
Show up late, and you're mostly competing on economics.
Show up early, before the story is polished and the risks are neatly packaged and you're competing on trust.
In biotech, where things go sideways all the time, trust is the shortcut nobody talks about enough. Negotiations lighten. Diligence gets honest. Risk-sharing turns creative instead of defensive.
Founders aren't just running spreadsheets. Deep down they're asking:
"Who do I actually want next to me when the data wobbles?"
That's why the moves that matter most usually happen years before the banker ever shows up.
Timing > capital.
Some still don't get it.
The best deals aren't won in the data room.
They're earned quietly, long before anyone's keeping score."
Well, it’s not too hard to imagine Dr Lalezari in this kind of scenario, working out a deal based on trust and, dare I say, shared values? Competing on trust. Frankly, I think this kind of mind-set is made easier, or enabled, or enhanced, by the huge numbers to divvy up… We are fortunate that it’s a big pie, and there is a lot to go around. So there is that. But let the details fall into place, let the financial engineers do their thing and leverage what they can. More than likely, Cytodyn already knows who they want sitting beside them. Despite our speculations, despite the obvious suspects and the numbers.
Don’t get me wrong—the financial details are “crucial,” and Hefez makes that point. For the sake of a decent retirement, I want Hoffman to be at the top of his game. But in this sideways world, I’ll take some solace in the words of one of Merck’s best and brightest. Not that I think Merck is gonna be our Big Daddy or anything… In fact, this has reinforced my feeling in the ViiV/Max/GSK connection, because of the history and personal vibes there. Or some Euro connection, anyway. The cultural fit seems better. However it plays out, reading that post made the secular humanist in me feel much better.
https://www.linkedin.com/posts/yarivhefez_The...2112-7IZJ/
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