Oxford, UK, March 19th, 2012
The pharmaceutical and biotechnology industry is undergoing considerable change as the patent cliff looms, fostering invention and change, and a strong need for successful partnering. There are also new opportunities to develop in emerging and emerged new markets. What impact are these changes having on companies as they seek partners, to strike the best deal? How can companies be sure that the deal terms they achieve, and associated royalties, are the best possible? The terms of licensing deals are turning back in favour of cash-rich pharmaceutical companies, and there are key lessons to be learned by any aspiring dealmaker.
“For biotechs, protecting cash flow is key to survival, which means that licensing terms have become more crucial than ever before”, claims Fintan Walton, CEO of PharmaVentures, a leading transactions firm. In fact, managing both financial as well as clinical risk will be vitally important according to the recently published report from PharmaVentures, The Royalty Rate Report 2012: A Comprehensive Assessment of Valuation in the Pharmaceutical Sector. “The adoption of the correct valuation models can enable companies to derive better value from their dealmaking in these challenging times. The Report sets out to provide essential assessment through the most powerful methodologies available, selected case studies and PharmaVentures consultants’ experience in dealmaking advisory services.”
Nigel Borshell, Editor of the Report, says, “A great deal of time and effort is spent in negotiating deal terms, but is the time spent on the various value components in line with their relative values? Our advice is to negotiate hardest on the things that really deliver value. You stand to lose more of your hard earned value through royalty percentages and tier ‘adjustments’ than on any other component of the deal”.
The Report explodes some of the myths of valuations and royalty rates calculations, highlights what you should factor in to your own calculations and explains how best to generate useful royalty rate outcomes. It does this by providing key case histories, deal analysis, and opinion leader comment all relating to the quest for better more useable valuation data. A significant part of the content has been formulated by leveraging PharmaVentures’ 20 years of experience in assisting pharmaceutical and biotechnology companies worldwide in all aspects of dealmaking.
Topics covered in the Report include:
- Clear guidance on the best methodologies to use when calculating Valuations and Royalty Rates to assist with vital decision making
- Opinions and advice from leading industry dealmakers on how to calculate Royalty Rates
- Contextual information – The report reviews the appropriate methodologies to use as part of the process to calculate Royalty Rates in-depth. It explores questions such as: “What do royalties mean in terms of value?” and “Where do royalties fit within the deal?”
- More case studies – PharmaVentures highlights the issues and pitfalls so dealmakers can avoid them
The new Royalty Rate Report is published under PharmaVentures’ imprint, PharmaDeals®.
For further information, contact:
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+44 1865 332700
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