Q&A

Q1. What are the pros and cons of Abgenixs

collaborating with a partner on ABX-EGF

Pros Cons

Startups often lack financial

resources and expertise
Collaboration allow Abgenix to obtain rapid access to
Testing and regulatory
complementary assets (skills & resource)
process is long and costly.
Reduce the costs and risks of Abgenix in the ABX-EGF project

Abgenix will not achieve full

potential revenue as it can
achieve if it were to go solo.
Q2. If Abgenix chooses collaboration, would it be better
off licensing ABX-EGF to the pharmaceutical company
or forming a joint venture with the biotech company?

Main differences between joint venture and licensing are:

Monetary:
Abgenix needs cash infusion.
Licensing, would not have to bear further costs for further developments,
testing, regulatory, manufacturing and marketing f the ABX-EGF product
Joint venture, Abgenix still has to shoulder a share of such costs and risks
Q2. If Abgenix chooses collaboration, would it be
better off licensing ABX-EGF to the pharmaceutical
company or forming a joint venture with the biotech
company?
Speed:
Competitors are already developing drugs targeting the same
EBX pathway
Spent too much time before launching the product.
Astrazeneca /Genetech might enter the market first and obtain
first mover advantage.
Difficult to switch product
Q2. If Abgenix chooses collaboration, would it be
better off licensing ABX-EGF to the pharmaceutical
company or forming a joint venture with the biotech
company?
Licensing is the better options compare to joint venture.
Advantages of collaboration mode of licensing must have been well
known to Abgenix management.
Yet, Abgenix still initially considered a slow, costly strategy of going solo
Whether joint venture or licensing out is better depends on the exact
need for shortening the time needed for product launch vs benefits of
greater control, potential revenue, and developing new competencies.