presentation

IMD892 06.02.2018

AM-PHARMA: CREATING VALUE (C)

Tim Knotnerus, Marion Owczarczak-Fogli and Mohammed El-Ansari (IMD EMBA 2017) prepared this case under the supervision of Professor Jim Pulcrano as a basis for class discussion rather than to illustrate either effective or ineffective handling of a business situation.

This case study was prepared by the authors in their personal capacity. All opinions and characterizations expressed in this case study are the authors’ own and do not reflect the view of AM-Pharma or Pfizer Inc. The patient/family data are not from actual clinical trial participants.

Having conducted a detailed scientific, market and corporate due diligence on AM-Pharma and its products, US based Pfizer Inc. indicated its interest to make a deal to gain exclusive access to AM- Pharma’s product. The parties agreed on an option-to-acquire format to (i) share the risks of the ongoing phase II clinical trial; (ii) provide the AM-Pharma investors with an early return whilst retaining the possibility of a significant future upside in case of success; and (iii) start investing themselves in preparation for conducting a complex and expensive phase III clinical trial.

The next stage of the negotiations between Pfizer (represented by Bob Smith and Leslie Coney) and AM-Pharma (represented by Erik van den Berg, Tim Knotnerus and Russell Greig) involved the commercial terms of the option-to-acquire deal structure.

The companies needed to find deal terms that were acceptable to all stakeholders. What could such terms be?

Copyright © 2018 by IMD - International Institute for Management Development , Lausanne, Switzerland (www.imd.org). No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means without the prior written permission of IMD.

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