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Is BioSante Giving Away the Store?

By Brian Orelli, PhD - Updated Apr 6, 2017 at 10:20PM

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A licensing deal without upfront cash seems to be better than no deal at all. I guess.

You can't give this stuff away! Oh wait, BioSante Pharmaceuticals (Nasdaq: BPAX) seems to be doing exactly that.

Yesterday, the drugmaker licensed its pancreas and prostate cancer vaccine to Aduro BioTech to use it in combination with Aduro's vaccine CRS-207.

I love a good platform drugmaker. The ability to make money over and over again by licensing out a technology is a blessing for investors that don't have to take a dilution hit every time the company needs more cash.

Unfortunately, there doesn't seem to be any upfront cash for BioSante in the deal. Compare that to Seattle Genetics (Nasdaq: SGEN), which has generated more than $155 million licensing its antibody-drug conjugate technology to 11 different companies, most recently to Abbott Labs (NYSE: ABT) and Pfizer (NYSE: PFE).

BioSante is due milestone and royalty payments if the combination product is commercialized, but no numbers were put in the press release, so it's impossible to know if BioSante traded upfront cash for a larger percentage on the back end.

Granted, the cancer vaccine program isn't BioSante's lead product. It'll live and die by its testosterone gels: LibiGel for female sexual dysfunction and Bio-T-Gel, which is partnered with Teva Pharmaceuticals (Nasdaq: TEVA), for men that need a testosterone boost.

But the cancer vaccine has been pumped as the next Dendreon's (Nasdaq: DNDN) Provenge. Licensing it to a company whose claim to fame is that it has been issued $20 million in grants and contracts doesn't exactly lend credence to the program.

Better than nothing? I guess. Enough to get me excited about BioSante? Not really.

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