Aspen purchasing

Aspen Pharma. The company announced a major deal 11 days ago, they certainly never, ever stand still, yesterday announcing another. This time they announced a series of licensing agreements that will be done with a crowd called TesoRx, with rights to (copy paste time) "license select international rights to TSX-002, an innovative unmodified oral-Testosterone replacement therapy." Aspen will become a minority shareholder in TesoRx.

The testosterone part in there obviously has negative connotations for children of the 80's, or anyone who lived through the doping scandals of that time, with specific cases of abuse levelled at sports teams from behind the iron curtain. To be fair however, many allegations were levelled against all teams, there were cover ups and high profile falls from grace for the likes of Ben Johnson. Testosterone replacement therapies to improve blood glucose levels in men over 45 (and thereby prevent diabetes) are more common nowadays.

This is by no means a huge deal for Aspen, it could however be a big deal. For the time being the TSX-002 has not jumped through all the hoops, the therapy has only been tested on 150 individuals and is about to begin trials in 2015.

So what is Aspen going to do in all of this? First things first Aspen will invest 15 million Dollars, upfront fees to be paid to TesoRx. And then, depending on when the therapy (it is worth pointing out that this is the first oral therapy of its kind) is eventually released and "certain regulatory and commercial milestones are reached", Aspen will pay no more than 20 to 60 million Dollars. In addition to those payments, Aspen will pay royalties to TesoRx for sales in a country by country basis, Aspen will be "responsible for developing and commercialising TSX-002 in the emerging markets of Latin America, Africa, Asia Pacific, Russia and other countries in the Commonwealth of Independent States".

If approved, this could be huge, currently, as the SENS points out, sales of Testosterone replacement products are 2.5 billion Dollars globally. An easily administered therapy would go a LONG way to more people using the therapies. This does however (to me at least) represent a different angle of business, getting involved in smaller businesses earlier on which only size and scale can often afford you that luxury. We continue to accumulate what is a fabulous business operating in an exciting sector.