So. . . let’s all play along here: if you were looking at licensing/ acquiring an anti-schizophrenia/bi-polar disorder drug franchise that had previously peaked global sales revenue of around $120 million a year, and you knew Lundbeck had exclusive rights to all non-US sales, AND you knew that global sales had declined by about 13 per cent (or $10 million) during the first six months of 2013 (vs. 2012). . . would you willingly pay something like three times annual US sales, as a cash upfront license/royalty, and agree to pay even more, in running royalties, if higher sales targets are one day reached?
I wouldn’t. But Mr. Saunders — acting as a steward for Forest Labs — just did. Why? Because Forest’s other schizophrenia drug candidate recently clanked — at FDA. [And, less charitably, because he is still in the thrall of one Fast Fred Hassan, as to asenapine.]
Sadly, I think he must still be at least sipping, if not gulping Fred Hassan’s Kool Aid®. First at Schering, then at B+L, and now at Forest. Mr. Saunders has most recently cut heads, levered up/issued debt, and amped up a stock buyback. . . and now overpaid for a long since faded comet. In my opinion, Saphris® is now (mostly) a dark, dingy, icy ball of known and documented side effects — with a dubious efficacy profile, compared to its peers.
But like Fast Fred, Brent must think if his US sales force flogs it hard enough — to psychiatrists treating institutionalized patients here, he will reverse the declines Whitehouse Station has seen. Me? I’d not bet on Forest being able to out-detail the legendary sales forces Merck had assembled. But that’s what makes it fun to watch. I’ll go pop some popcorn — sit tight! [Maybe Mr. Saunders, and Forest, will agree to take over the Merck dedicated sales people, too. We will see. And we will hope — but we doubt it. He (like Fred, before him!) always thinks his are the only smart people in the room.]