On August 5, shares of Israel-based drug discovery firm Compugen (CGEN) popped ~45% in response to its disclosure of a potentially lucrative collaboration agreement with Bayer. CGEN will receive an upfront payment of $10M and potentially as much as $530M based on the achievement of certain milestones relative to the commercial development of two of CGEN's immune checkpoint regulators, CGEN-15001T and CGEN-15022. Upon regulatory clearance, CGEN will receive high single-digit royalties on global net sales. The contract has the potential to be CGEN's largest (by far) in its 20-year corporate life and deliver a profound fundamental boost to the firm considering its miniscule revenues of ~$600k (TTM).
It doesn't take much scrutiny, though, to see...
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