from the 10-Q just filed by OPKO:
"Pursuant to the Asset Purchase Agreement, RXi will be required to pay us up to $50.0 million in milestone payments upon the successful development and commercialization of each drug developed by RXi, certain of its affiliates or any of its or their licensees or sublicensees utilizing patents included within the RNAi Assets (each, a “Qualified Drug”). In addition, RXi will also be required to pay us royalties equal to: (a) a mid single-digit percentage of “Net Sales” (as defined in the Asset Purchase Agreement) with respect to each Qualified Drug sold for an ophthalmologic use during the applicable “Royalty Period” (as defined in the Asset Purchase Agreement); and (b) a low single-digit percentage of net sales with respect to each Qualified Drug sold for a non-ophthalmologic use during the applicable royalty period."
Sentiment: Strong Sell
Big freaking deal. REad the line it says single digit. Let's say the drug makes 3 billion a year and OPKO takes it single digit of 9%. , that's $27 million dollars out of the 3 billion dollars. Peanuts, the agreement was superb because RXII will be doing all the work if they use the patents. Although for now RXII isn't using OPKO's patents and I don't expect them to until 5 years down the line. you short's just plain suck at biotech.
Sentiment: Strong Buy