Medarex: Profiting from excess opportunity

Companies that license out their core technologies presumably benefit from greater numbers of licensees. But the calculus changes if the company also develops products from that technology and deprives itself of a product development opportunity with each license it grants.

Medarex Inc. believes that the post-genomics era provides so many opportunities for new therapeutic compounds against new targets that the value it can derive from creative dealmaking does not subtract substantially from the value the company can create by retaining development rights, particularly if it takes equity stakes in its licensees...