Opt-in with upside

Deal-makers have been known to look askance when a biotech company provides a pharma company with opt-in rights to an in-licensed compound. According to the skeptics, the biotech adds value to the compound while the big company gets to keep the R&D off its P&L before scooping up the project once substantial risk has been removed.

In these cases, the question is what the biotech has left over at the end of the day. Amendments to a pair of deals between Roche and Evotec AG and Synosia Therapeutics AG demonstrate how the opt-in structure can leave upside for the junior partners...