Amgen agreed to pay $425 million initially and up to $575 million later if certain milestones were met.
And if various milestones in drug development and sales are achieved, Novartis may pay hundreds of millions more.
It will also pay up to $362 million more if certain milestones are achieved in development, plus royalties on sales of the drugs in Japan.
Aventis paid $25 million for the North American marketing rights for Picovir, but ViroPharma may have to refund as much as $20 million of that if certain milestones are not met.
One example is the Global Alliance for Vaccines and Immunization, which raised more than $5bn from private investors – and secured commitments of $6.3bn from donor governments to repay these investors if certain milestones are achieved – in bonds for vaccines in more than 70 countries.
If all milestones in the agreement are achieved, the total potential value of the agreement to Genmab would be approximately US$175 million, plus research funding and royalties.
When eBay agreed to plunk down $2.6 billion for Internet phone company Skype (a deal that could exceed $4 billion if certain milestones are met), both companies gave a 78-slide PowerPoint presentation.
Under the terms of the agreement, IncrediMail will pay $25 million, mostly in cash, with additional payments of up to $15 million in earn-out fees if certain milestones and performance based conditions are met.
Even if other milestones in the business are positive and appear equal, it is much easier to attract capital as a company with eight months of cash than the same company with two months of remaining cash.
The Basel, Switzerland-based company said it has agreed to buy GlaxoSmithKline plc's cancer-drug business for $14.5 billion, plus up to $1.5 billion more if certain milestones are met, and to divest most of its vaccines business to GSK for $7.1 billion, plus royalties. .
