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Список литературы по оценке нематериальных активов и интеллектуальной собственности > Оценка стоимости патентных прав компании Amgen inc. На лекарственный препарат "Parsabiv" и определение оптимального времени их реализации
Гулабян А.М., Цвирко С.Э. Оценка стоимости патентных прав компании Amgen inc. На лекарственный препарат "Parsabiv" и определение оптимального времени их реализации // Colloquium-journal. 2019. № 13-10 (37). С. 63-68.
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Фрагмент работы на тему "Оценка стоимости патентных прав компании Amgen inc. На лекарственный препарат "Parsabiv" и определение оптимального времени их реализации"УДК 330.322 Гулабян А. М., студент магистратуры Финансовый Университет при Правительстве Российской Федерации Россия, Москва Научный руководитель: Цвирко С. Э., к. э. н., доцент Финансовый Университет при Правительстве Российской Федерации Россия, Москва ОЦЕНКА СТОИМОСТИ ПАТЕНТНЫХ ПРАВ КОМПАНИИ AMGEN INC. НА ЛЕКАРСТВЕННЫЙ ПРЕПАРАТ “PARSABIV” И ОПРЕДЕЛЕНИЕ ОПТИМАЛЬНОГО ВРЕМЕНИ ИХ РЕАЛИЗАЦИИ Аннотация: Данная статья направлена на анализ практических аспектов применения метода реальных опционов в оценке стоимости патентных прав и определении оптимального времени их реализации (т.е. создания коммерческого продукта на основе патента) в современных рыночных условиях на примере решения реальной задачи с использованием реальных данных. Ключевые слова: экономика, корпоративные финансы, справедливая стоимость, оценка, модель ценообразования опционов Блэка-Шоулза, реальные опционы, инвестиционный анализ, оценка стоимости нематериальных активов, оценка стоимости патентов. VALUING PATENT RIGHTS OF AMGEN INC. ON “PARSABIV” AND DETERMINING THE OPTIMAL TIME OF THEIR EXERCISE Abstract: This paper aims to analyze the practical aspects of real option approach application in patent rights valuation and determination of the optimal time of their exercise (i.e. converting patent into a commercial product) in modern market conditions considering the real-life example and using the real data. Keywords: economics, corporate finance, fair value, valuation, Black-Scholes option pricing model,real options, investment analysis, intangibles valuation, patent valuation Gulabian A.M., graduate student Financial University under the Government of the Russian Federation Russia Moscow Supervisor: Tsvirko S. E., Ph. E. n., associate professor Financial University under the Government of the Russian Federation Russia Moscow Introduction In this paper we’ll consider the application of real-option approach in determination of the optimal time of patent. The object of our analysis will be the recent patent of Amgen Inc. on production and sale of Etelcalcetide (trade name “Parsabiv”). Amgen Inc. is one of the leading companies in U.S. biotech-industry that develops manufactures and implements innovative drugs based on genetic engineering. Founded in 1980, Amgen is known as the leader in its industry sector, as it was among the first biotech-firms that managed to unleash the potential of a new generation of effective and safe drugs to provide patients with innovative methods of serious diseases treatment. Etelcalcetide is a calcimimetic drug for the treatment of secondary hyperparathyroidism in patients undergoing hemodialysis. Initially the drug’s formula was developed by another company KAI Pharmaceuticals that consequently held the patent on it. However based on the information from the company’s official press release1 Amgen Inc. acquired KAI in 2012, thus it could be assumed that in 2013 the acquisition process had been already finished and thus Amgen obtained the patent rights on Etelcalcetide, expiring at the end of 2030. According to the information from the U.S. National Library of Medicine2the drug was synthetized in 2013, meaning that Amgen exercised the patent on Etelcalcetide in the year just immediately following its acquisition. However although having exercised the patent and thus having the drug developed Amgen couldn’t market its product Parsabiv (trade name for Etelcalcetide) until its approval by the US Food and Drug Administration (USFDA) for treatment of secondary hyperparathyroidism (HPT) in adult patients with chronic kidney disease (CKD) on hemodialysis in 2017. Thus Amgen didn’t receive any cash flows from its product sales till that time. Was it a right decision to exercise a patent immediately or it would have been better to wait till later times and if yes what would be the optimal time of converting a patent in a commercial product? These are the issues considered in this paper. Patent value estimation 1FDA Approves Amgen's Parsabiv™ (Etelcalcetide), First New Treatment In More Than A Decade For Secondary Hyperparathyroidism In Adult Patients On Hemodialysis. Available at: https://www.amgen.com/media/news-releases/2017/02/fda-approves-amgens-parsabivetelcalcetide-first-new-treatment-in-more-than-a-decade-for-secondary-hyperparathyroidism-inadult-patients-on-hemodialysis 2U.S. National Library of Medicine National Center for Biotechnology Information. Etelcalcetide. Available at: https://pubchem.ncbi.nlm.nih.gov/compound/Velcalcetide We’ll begin our analysis from estimating the value of Amgen’s patent on Parsabiv using the real option valuation technique based on the application of the modified Black-Scholes option pricing model. According to this approach the value of the patent will be equal to the one of the corresponding option to delay the drug development project provided by the patent. Thus we need to obtain the necessary data on modified Black-Sholes model’s required inputs to get the answer. It should be noted that we’ll estimate the patent’s present value as at the year of 2013. Thus in 2013 the corresponding real option to delay had 17 years remained till its expiration, since Amgen owns the patent rights on Parsabiv production and marketing till the end of 2030. (i.e. t = 17) Given the information above Amgen exercised the patent on Parsabiv in 2013 and thus invested the amount X in its development. The estimation of this investment’s amount is probably the toughest thing to do in this section since there is no publicly available information on this variable thus we used the average figure based on the information on research and development (R&D) spending statistics for pharmaceutical companies as at 2013 provided by Astra Zeneca company1and therefore assumed X = $3692.14m. At our next step we calculated the present value (as at 2013) of the corresponding cash flows to be received from the Parsabiv’s sales using the historic data obtained from the official company’s financial statements and from Bloomberg Terminal and also forecasting it for future periods till the end of 2030 mostly assuming stable average growth rates of Amgen’s financial indicators and relevant ratios. Each cash-flow from Parsabiv was estimated as the share of the corresponding year’s net operating profit (i.e. EBIT(1 – tax)) from product sales – this share was 1Al-Huniti, Nidal. Quantitative Decision-Makingin Drug Development. AstraZeneca, June 20, 2013, p. 23. assumed to be equal to the one of Parsabiv’s sales in total amount of company’s product sales. Since Parsabiv is relatively new product it will at first lack public trust at the primary stage of its introduction which thus results in its initial share in total sales to be rather insignificant. This may be also explained by the company’s intention no to produce large amounts of new product in order not to incur additional losses in case of low product demand, thus the initial quantity produced will be limited and so will the primary product sales, undertaken at most to test the market conditions so as to determine the further sales development strategy. However given the innovativeness of Parsabiv and according to forecasted estimates provided by Bloomberg the first stage of introduction will take only several years and then it sales’ share are assumed to grow relatively fast up until the year of 2023, so by that time this share will slightly exceed the one of Amgen’s another drug – Sansipar which is a close substitute of Parsabiv being the less advanced predecessor of the latter. After that Parsabiv’s share in total product sales is expected to experience the normal average growth rate corresponding to the one of Sensipar. Obviously this assumption makes our forecast rather conservative – however given the prudence accounting concept it’s better to understate income rather than expenses. Effective tax rates were also assumed to be subject to stable average growth, estimated without taking into account the abnormal fluctuations due to accounting adjustments to recent Tax Act enacted by US on December 22, 2017. At the same time we expect the tax rate to be no more than US current corporate income tax of 21%. It’s likely that the Amgen’s effective tax rate will be generally lower than corporate one due to tax reliefs provided by US government to companies involved in R&D, however we again chose the conservative approach on prudency grounds to be on the safe side. The obtained cash flows were discounted at Amgen’s WACC using its historic values obtained from Bloomberg Terminal and assuming it constant in future periods given its insignificant average growth rate. As a result of our calculations we’ve obtained the following discounted cash flows (DCF) for each period of Parsabiv’s sales as shown in the tables below: Table 1 – Parsabiv’s DCF calculation output 31.12.2017 31.12.2018 31.12.2019 Year № (i) 1 2 3 $ $ $ Product sales 21795000320 22532999168 21881339661 EBIT(adj.)/Sales 59% 58% 59% EBIT (adj.) 12858000640 13116999424 12967750935 Eff. Tax rate (tax) 0,794 0,121 0,206 EBIT (1-tax) 2648748132 11529842494 10302053293 Parsabiv's share in total sales 0,023% 1,491% 2,429% CF (Parsabiv) 607650,3999 171926828,2 250285019,8 WACC 10% 8% 8% DF 0,907 0,852 0,787 DCF 551406,8964 146556990,9 196983200,4 Table 2 – Parsabiv’s DCF calculation output 31.12.2020 31.12.2021 31.12.2022 Year № (i) 4 5 6 $ $ $ Product sales 22005103514 22976624931 23991038847 EBIT(adj.)/Sales 60% 61% 63% EBIT (adj.) 13276678018 14113264999 15002566808 Eff. Tax rate (tax) 0,21 0,21 0,21 EBIT (1-tax) 10488575634 11149479350 11852027778 Parsabiv's share in total sales 3,094% 4,490% 6,517% CF (Parsabiv) 324498464 500640503,6 772394761,9 WACC 8% 8% 8% DF 0,727 0,671 0,619 DCF 235797079,7 335879272,2 478440554,3 Table 3 – Parsabiv’s DCF calculation output 31.12.2020 31.12.2021 31.12.2022 Year № (i) 4 5 6 $ $ $ Product sales 22005103514 22976624931 23991038847 EBIT(adj.)/Sales 60% 61% 63% EBIT (adj.) 13276678018 14113264999 15002566808 Eff. Tax rate (tax) 0,21 0,21 0,21 EBIT (1-tax) 10488575634 11149479350 11852027778 Parsabiv's share in total sales 3,094% 4,490% 6,517% CF (Parsabiv) 324498464 500640503,6 772394761,9 WACC 8% 8% 8% DF 0,727 0,671 0,619 DCF 235797079,7 335879272,2 478440554,3 Table 4 – Parsabiv’s DCF calculation output 31.12.2023 31.12.2024 31.12.2025 Year № (i) 7 8 9 $ $ $ Product sales 25050238956 26156202563 27310994267 EBIT(adj.)/Sales 64% 65% 66% EBIT (adj.) 15947905097 16952810825 18021037441 Eff. Tax rate (tax) 0,21 0,21 0,21 EBIT (1-tax) 12598845026 13392720552 14236619579 Parsabiv's share in total sales 9,458% 10,003% 10,578% CF (Parsabiv) 1191660810 1339636071 1505986257 WACC 8% 8% 8% DF 0,572 0,528 0,488 DCF 681510837,2 707356561,1 734182462,3 Table 5 – Parsabiv’s DCF calculation output Table 6 – Parsabiv’s DCF calculation output 31.12.2026 31.12.2027 31.12.2028 Year № (i) 10 11 12 $ $ $ Product sales 28516769819 29775780148 31090375561 EBIT(adj.)/Sales 67% 68% 70% EBIT (adj.) 19156574908 20363664600 21646815150 Eff. Tax rate (tax) 0,21 0,21 0,21 EBIT (1-tax) 15133694177 16087295034 17100983969 Parsabiv's share in total sales 11,187% 11,831% 12,511% CF (Parsabiv) 1692993086 1903221610 2139555398 WACC 8% 8% 8% DF 0,450 0,416 0,384 DCF 762025713,2 790924895,9 820920055,7 Thus the present value of cash flows from the Parsabiv’s development (PV) amounts to approximately $7627.548m, assuming them to be received starting from the next year after the investment in the product’s development was made and thus the patent was exercised. 31.12.2029 31.12.2030 Year № (i) 13 14 $ $ Product sales 32463010127 33896246266 EBIT(adj.)/Sales 71% 72% EBIT (adj.) 23010819288 24460771741 Eff. Tax rate (tax) 0,21 0,21 EBIT (1-tax) 18178547238 19324009675 Parsabiv's share in total sales 13,231% 13,992% CF (Parsabiv) 2405236090 2703907855 WACC 8% 8% DF 0,354 0,327 DCF 852052756,7 884366139,1 $ ???? = ????????? 7627547926 However the fact that Amgen couldn’t market its newly synthetized drug after its development in 2013 until the approval of US FDA was received in 2017 allowing for the first sales to take place creates the development lag (dlag) of 3 years, that should be also taken into account in estimation of the present value of cash flows from the Parsabiv’s sales. Given that the corresponding cash flows are received evenly throughout the patent expiration period (t) the annual cost of the product’s development delay could be calculated as y = 1 ?? = 1 17 ? 0.059 Therefore PV of cash flows from Parsabiv’s realization adjusted to the development lag (S) was estimated as follows: ?? = ???? (1 + ??) ???????? ? $6425.607?? Given the patent remaining life of 17 years we take assumed the risk-free rate (r) to be equal to the one of the 20-year US Treasury bond in 2013 (i.e. r = 0.0312) Due to the lack of historic data on Parsabiv, being a relatively new product, the volatility in its cash flows (?) was approximated by the one in cash flows received from the sales of its close substitute Sansipar. (i.e. ? ? 0.226 ) Having obtained the key inputs we can now estimate the other parameters of the modified version of Black-Scholes model and then estimate the value of the patent, which coincides with the one of the corresponding real call option to delay: ??1 = ln ( ?? ?? ) + (?? ? ?? + ?? 2 2 ) ?? ????? ? 0.56 ??2 = ??1 ? ????? ? ?0.38 N(d1) = ? = Pr (Z ? d1), Z ~ N (0;1) ? 0.7113 N(d2) = Pr (Z ? d2) ? 0.3534 Therefore the corresponding call value is: ?? = ???? ???????(??1 ) ? ???? ???????(??2 ) ? $913.525?? Hence the Amgen’s patent on Parsabiv approximately worth $913.525m Determination of optimal time to exercise the patent rights Was it a right decision to exercise a patent immediately or Amgen should have waited till later times? Since the NPV from the Parsabiv’s development in 2013 equals S – X ? $2733.47m , so that it exceeds the obtained value of the patent (c) then for Amgen it’s definitely better to convert Parsabiv into commercial product as soon as possible than to hold the patent on it that will become less valuable with each year of the development delay that will shrink the period of the patents expiration (t) and the same time will increase annual costs of delay (y) thus leading to a decrease in the corresponding call’s value. Hence the Amgen’s decision to develop the Parsabiv in 2013 was reasonable. However, given the conservative assumptions about the future growth in Parsabiv’s sales share and tax rates underlying the calculation of the patent value it could have been the case that the obtained estimate (c) will instead exceed the corresponding project’s NPV if the more optimistic course of action is considered instead. If this was true than holding Parsabiv as a patent would be more preferable than converting it immediately into a commercial product. However in this case one will likely to be concerned with question about the optimal period of holding it as patent. This issue was considered by Aswath Damodaran in his book on investment valuation1 on the example of patent on drug Avonex owned by another US bio-tech firm Biogen, which value (c) estimated by the similar real-option technique appeared to be greater than the NPV from its immediate conversion into the commercial product in 1997 (i.e. development of drug Avonex and thus the exercise of the patent 1Damodaran Aswath. Investment Valuation: Tools and Techniques for Determining the Value of any Asset, University Edition. Wiley Finance Series, 2012, p. 1103. 0 100 200 300 400 500 600 700 800 900 1000 Value ($m) NPV from Avonex if developed now Value of patent on Avonex (as option) Convert patent on Avonex into commercial product here rights on it) with the corresponding difference being the time premium for holding a patent on Avonex rather than investing in its development as product. In this case as argued by Aswath Damodaran the optimal time of patent exercise is the one at which this time premium will turn to zero (i.e. when c = S – X). This point in time could thus found graphically by valuing the call assuming that all Black-Scholes model’s key parameters other than patent life (t) stay constant and saving the obtained estimates for each t to plot them further on the graph together with the current product’s NPV. This can be treated as a simulation of the patent’s early exercise at different times till it its expiration period (thus allowing it to be presented as an American call) with the obtained values being its values given the corresponding exercise time, since the traditional Black-Scholes model doesn’t allow for such flexibility to be taken into account and thus assumes that patent may be exercised only at the end of its life (i.e. patent is assumed to be a real call option of European type). The optimal time to exercise is then determined as the one at which these two curves intersect. Since with each year of product development delay the patent life (t) will become shorter resulting in a higher cost of annual development delay that will yield lower call (i.e. patent) values the curve illustrating the value of patent as option at different times will be therefore downward sloping. Following this logic and using the initial data from the example in Damodaran’s book we’ve obtained the graph of c (i.e. value of patent as an option) with respect to remaining patent life (t) plotted together with line fixed at the current level of NPV resulted from the immediate development of Avonex (the picture of the same graph was given in Damodaran’s book – however we decided to model it ourselves so as to ensure the understanding of the described methodology): 0 500 1000 1500 2000 2500 3000 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 Value ($m) Number of years left on patent (t) NPV from Parsabiv if developed now Value of patent on Parsabiv (as option) Figure 1 - Patent value Vs. NPV (Avonex case) Source: made by author Moving back to our problem we can plot the same graph for the case of Amgen’s Parsabiv, which is illustrated on figure 3.2 below. Figure 2 - Patent value Vs. NPV (Parsabiv case) Source: made by author Therefore given that the patent value increases with its remaining life it is likely that the optimal time to exercise the patent on Parsabiv (denoted as the point of intersection of two curves) had passed long before the time when Amgen Inc. acquired the KAI Pharmaceuticals and thus consequently became the owner of the corresponding patents rights. Obviously since the described technique of patent’s optimal exercise time determination is based on simulation it is not expected to yield precise results as compared to ones based on models applicable to American option valuation such as Binomial one or using the Black-Sholes equation with a non-linear function. However these approaches are far more complicated and time consuming. Thus in a world when the time on decision-making is always limited the accuracy advantage is vanished making such simulation the best tool providing with the general picture of overall value trends. References Monographies: 1. Branch, Marion A. Real options in Practice. New York: Wiley, 2003, 377 p. 2. Damodaran Aswath. Damodaran on Valuation: Security Analysis for Investment and Corporate Finance. John Wiley & Sons, 2006, 1372 p. 3. Damodaran Aswath. Investment Valuation: Tools and Techniques for Determining the Value of any Asset, University Edition. Wiley Finance Series, 2012, 1372 p. 4. Donald and DePamphilis. Mergers, Acquisitions, and Other Restructuring Activities: An Integrated Approach to Process, Tools, Cases, and Solutions. Academic Press, 2017, 770 p. 5. Huchzermeier A., Loch C. Evaluating R&D Projects as Real Options: Why More Variability is not always better. Working Paper, WHU Koblenz and INSEAD, 2003, 106 p. 6. Limitovskiy М.А. Investitsionnyye proyekty i real’nyye optsiony na razvivayushchikhsya rynkakh: ucheb. posobiye dlya bakalavriata i magistratury [Investment projects and real options in emerging markets: study guide for undergraduate and graduate students], 5th editition, updated and revised, Yurayt Publ., 2017, 486 p. 7. Mun J., Real Options Analysis. Tools and techniques for valuing strategic investments and decisions, John Wiley & Sons, 2006. Periodicals: 8. Angelis D.I. Capturing the options value of R&D. Research Technology Management, 2000, pp. 31 – 34. 9. Brennan M. J. and Trigeorgis L. Project Flexibility, Agency and Competition. Oxford University Press, 2000, pp. 71 – 84. 10. Bruslanova N. Evaluation of investment projects using real options technique. Finansovyy director [Financial director], no. 4, 2004, pp. 20 – 23. (in Russian) 11. Karpova N., Pocherin N. Application of option theory in determination of value of R&D and license agreements. Voprosy otsenki [Assessment issues], no. 2, 2000, pp. 57 – 66. (in Russian) 12. Pirogov N.K., Zubtsov N. Interaction of real options on the example of development projects in Russia. Korporativnyye finansy [Corporate finance], Vol. 6, no. 2, 2008, pp. 40 – 55. (in Russian) 13. Vonnegut A. Real Options Theories and Investment in Emerging Economies. Emerging Markets Review, Vol. 1, 2000, pp. 82 – 100. Data-sources: 14. Bloomberg Terminal 15. Drugbank. Etelcalcetide. Available at: https://www.drugbank.ca/drugs/DB12865 (Retrieved 3 May 2019) 16. FDA Approves Amgen's Parsabiv™ (Etelcalcetide), First New Treatment In More Than A Decade For Secondary Hyperparathyroidism In Adult Patients On Hemodialysis. Available at: https://www.amgen.com/media/news-releases/2017/02/fda-approves-amgensparsabiv-etelcalcetide-first-new-treatment-in-more-than-a-decade-for-secondaryhyperparathyroidism-in-adult-patients-on-hemodialysis (Retrieved 3 May 2019) 17. Official annual financial statements of Amgen Inc. 18. U.S. National Library of Medicine National Center for Biotechnology Information. Etelcalcetide. Available at: https://pubchem.ncbi.nlm.nih.gov/compound/Velcalcetide (Retrieved 3 May 2019) Другие книги из этого разделаНематериальные активы как инновационно-стратегические ресурсы предприятия: методы анализа и оценкиПравовое регулирование отношений в области идентификации и оценки стоимости интеллектуальной собственностиОсобенности оценки нематериальных активов строительных компанийНематериальные активы как инновационно-стратегические ресурсы предприятия: методы анализа и оценкиПравовое регулирование отношений в области идентификации и оценки стоимости интеллектуальной собственностиОсобенности оценки нематериальных активов строительных компаний