Business case for Pfizer-LABS joint ventureThe Pfizer investment in Arena Pharmaceuticals for cannabinoid drug pipeline was $6.7B USD.
The Pfizer investment for Seagen's targeted payload delivery system for oncology was another $54B USD.
Pfizer has invested over $60B USD within the area of pharmaceutical cannabinoid molecules and as an investment requires a predetermined internal rate of return. Pfizer's internal rate of return depends upon the cost structure of pharmaceutical cannabinoid molecules as governed by Medipharm Labs.
Tremendously lowering the cost structure of those molecules increases the internal rate of return for Pfizer. Since LABS is the only FDA approved supplier of such molecules they then basically control the internal rate of return on Pfizer's $60B USD investsments.
How is the best way for Pfizer to reduce cost risk exposure?
a) not to address the risk
b) spend another 5 years developing everything that LABS has developed...if even possible
c) eliminate the risk and increase speed to market, a joint venture