These Guys Should Start a Hedge Fund
October 18 2018 - 11:36AM
Dow Jones News
By Charley Grant
How do you earn an investment return that would make even the
luckiest bitcoin speculator blush?
One biotech company has the answer. Endocyte announced Thursday
it would sell itself to Novartis for $2.1 billion in cash. The deal
was to acquire Endocyte's novel prostate cancer treatment.
That is a great result for Endocyte -- its shares rose 50%. It
looks even better when one considers how Endocyte acquired the
drug's rights. It bought an exclusive license in October of 2017
for just $12 million in upfront cash, plus an equity grant and
future cash incentive payments.
All told, Endocyte earned about 175 times its initial cash
outlay in one year. Given that payout, perhaps the Endocyte
executives will consider launching a hedge fund once the deal
closes.
Write to Charley Grant at charles.grant@wsj.com
(END) Dow Jones Newswires
October 18, 2018 11:21 ET (15:21 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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