Give me a break please. No question that aurora's science to identify and speed up drug candidates is excellent. But for the price Boger and his advisors paid, the purchase has been a disaster for us. How much do you think we get for each candidate NOVARTIS DECIDES to take up. With the way things have been going with our revenues in the past--peanuts. How many porducts should we spend time to research, out of which Novartis may decide to take one, may be none? Probably many with the rest have to be thrown away because if Novartis won't take them which other company would?
Besides, if Novartis's was such a good deal why some of the big pharmas with deep pockets and not many products in the pipeline did not snatch it away before VRTX did?
here is Boger's view on the deal (snip from BioCentury)
Vertex�s P&L epiphany Looking out the next few years, Vertex Pharmaceuticals Inc. saw that its plan to reach profitability was going to run headlong into a large ramp-up in development expenses related to its 2000 kinase deal with Novartis AG. Following last week�s restructuring of the deal, VRTX believes it may have nipped this impending collision in the bud. Under the original deal, VRTX had responsibility for early clinical development through biochemical proof-of-concept in humans, defined as late Phase I or early Phase II testing (see BioCentury, May 15, 2000). As amended, Novartis will be responsible for compounds starting in preclinical development.
VRTX (Cambridge, Mass.) has about 500 employees in R&D, of which 150 are discovery workers dedicated to the deal with Novartis (NVS; SWX:NOVN, Basel, Switzerland). Thus far, VRTX has put three kinase inhibitors into preclinical development: VX-680 and VX-528 for cancer, and VX-608 for neurological diseases. As these and other compounds from the deal progress, VRTX chairman and CEO Joshua Boger told BioCentury that the company "would have had to increase headcount on the development side. This would have hit hard in 2005 through 2007, which are the years we see the company moving to profitability. Our profitability will be driven off our first internal drugs to make it to market, for which we expect the first NDAs in 2006 and 2007.�
Boger also said he didn�t want to be in the position of having to choose whether to allocate resources to internal compounds or to those covered by the partnership. "Let�s say, for example, that in 2006 I didn�t have the ability to service the Novartis deal and my internal candidates � what gets cut? We�d be in a tough position, and it�s not unbelievable that we would have to cut back on our internal efforts, thus putting a real constraint on our ability to do activities for our own top line.� Although VRTX expects the restructured deal to reduce expenses in the future, it�s not possible to determine whether the company will receive more or less money from NVS in milestones and other payments. The original deal covered eight compounds, and VRTX was eligible for more than $600 million in license fees, milestones and reimbursements. As amended, VRTX will nominate an unspecified number of candidates for preclinical development. It will receive $10 million upon acceptance of each candidate and is eligible for up to $25 million in additional milestones for each compound. The royalty rate is unchanged.