BioNTech Reaches Settlement Agreement on COVID Vaccine Royalties
In a significant development, BioNTech (BNTX) has announced a settlement agreement with the National Institutes of Health and the University of Pennsylvania regarding royalties on its COVID-19 vaccine, Comirnaty, developed in partnership with Pfizer (PFE).
A Manageable Headwind
According to Morgan Stanley analyst Terence Flynn, the agreement will result in low-single digit percentage royalties on future sales of Comirnaty, with the companies paying $1.15 billion for historical royalties. While this may seem like a substantial amount, Flynn views it as a manageable headwind for both companies.
Breaking Down the Numbers
To put this into perspective, the firm models total 2025 Comirnaty worldwide sales at $4.9 billion. A 5% royalty on these sales would translate to approximately $250 million. This settlement agreement is likely to have a minimal impact on the companies’ bottom line.
What This Means for Investors
This development is significant for investors, as it provides clarity on the royalty structure for Comirnaty. With the settlement agreement in place, BioNTech and Pfizer can now focus on the future development and sales of their COVID-19 vaccine.
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