The Success Fee is a compensation formula applied at the back-end of all successfully completed agreements effectuated by our clients based on an introduction through Pharmalicensing's Partnering Search & Profiling services.
The Success Fee will be calculated based on the formula below (in US$):
Partnering Search
Profiling
The Success Fee is applied by Pharmalicensing based only on a successfully completed agreement between our client and a third party organisation introduced to the client by Pharmalicensing. Payment shall be made to Pharmalicensing in the same manner and time that the payments are exchanged between our client and the third party.
Partnering Search
The simple answer is $320,000.
And this is how we calculate the Success Fee:
| Transaction value | % | Success Fee |
|---|---|---|
| $1,000,000 | 8% | $80,000 |
| $1,000,000 | 6% | $60,000 |
| $1,000,000 | 4% | $40,000 |
| $7,000,000 | 2% | $140,000 |
| $10,000,000 | $320,000 |
A few other examples:
| Transaction value | Success Fee | Overall % |
|---|---|---|
| $10,000,000 | $320,000 | 3.2% |
| $15,000,000 | $420,000 | 2.8% |
| $20,000,000 | $520,000 | 2.6% |
| $25,000,000 | $620,000 | 2.48% |
Profiling
And for Profiling it is $160,000.
And this is how we calculate the Success Fee in this case:
| Transaction value | % | Success Fee |
|---|---|---|
| $1,000,000 | 4% | $40,000 |
| $1,000,000 | 3% | $30,000 |
| $1,000,000 | 2% | $20,000 |
| $7,000,000 | 1% | $70,000 |
| $10,000,000 | $160,000 |
A few other examples:
| Transaction value | Success Fee | Overall % |
|---|---|---|
| $10,000,000 | $160,000 | 1.6% |
| $15,000,000 | $210,000 | 1.4% |
| $20,000,000 | $260,000 | 1.3% |
| $25,000,000 | $310,000 | 1.24% |
Do we have to pay a Success Fee on all deals that we do in the future?
No, the Success Fee is only applicable to those agreements which have been actively effectuated by an introduction to the third-party partner organisation through Pharmalicensing services.
At what point is the Success Fee payable? Do we have to pay the Success Fee at the time we execute an agreement with the third party?
No, you would not need to pay the Success Fee at the time you execute the agreement with the third-party. The success fee will only be payable at the point when payments are exchanged between you and the third-party organisation.
What happens if we negotiate staged payments with the third party? Do we have to pay the full success fee up-front?
No, you would not need to pay the full Success Fee up-front if you negotiate staged-payments with the third party organisation. The success fee will only be applicable and payable at the point payments are exchanged, and the level of the success fee will only be calculated based on the levels of payment being exchanged at any particular time.
If we execute an agreement with a third party but the agreement collapses before any payments are exchanged do we still have to pay the Success Fee?
No, under these circumstances there would be no Success Fee applicable because no payments would have been exchanged between you and the third party. At this stage we would be happy to work with you to identify alternative partners with whom you can work.
To what elements of an agreement between my company and a third party would the Success Fee be applicable?
The Success Fee would be applicable to all elements of an agreement you would make with the third party organisation where payments would be exchanged.
These would typically be on up-front payments, milestones and ongoing royalty payments for licensing deals, upfront payments and any applicable royalties for transactional exchanges, or on angel/venture financing exchanged.
Which Pharmalicensing services have the Success Fee applied to them?
The Success Fee is applicable based on introductions only through Pharmalicensing's Partnering Search and Profiling services. Should you identify a partner company through the PL Intelligence service or simply by finding their listing on the pharmalicensing.com webservice the Success Fee will not apply.
| Transaction value |
 |
| The Success Fee |
$320,000 (3.2%) |
Number in the brackets shows percentage of the Success Fee to overall transaction value.
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