Morphosys AG O.N. (LON:0NDV) is a biotechnology company developing antibody-based therapeutics for an array of indications. It is transitioning from a model of partnering early-stage leads to a proprietary development company. In 2015, research and development on these programmes increased by 61% and management guided to an additional 40% increase in 2016. This coincides with the maturation of its Partnered Discovery programmes, the first of which is expected to generate revenue in 2017.
Royalty revenue on the horizon
Janssen is running Phase III trials of guselkumab for psoriasis, which are expected to read out throughout mid- to late 2016, and stated that it intends to seek approval before the end of 2017. This would be the first royalty-based revenue stream for MorphoSys. The other potential near-term royalty source, bimagrumab (Novartis AG (NYSE:NVS)), failed to meet the primary endpoints in its Phase IIb/III trial for myositis in, although other clinical trials continue. We are no longer including the drug in our model.
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