What does &quot;commercial target&quot; mean in a pharma licensing agreement?
<p>I am having some trouble with some of the terminology in Licensing agreement SEC filings. Does someone know what is meant by &quot;commercial target&quot;? The definition just states:
&quot;1.18 “Commercial Target” means the Target for which Licensee is granted a Commercial License hereunder.&quot;</p>
<p>Here is a link to the relevant document:
<a href="https://www.sec.gov/Archives/edgar/data/0001175505/000119312513338467/d536956dex1030.htm" rel="nofollow noreferrer">https://www.sec.gov/Archives/edgar/data/0001175505/000119312513338467/d536956dex1030.htm</a></p>

<p>It's defined in the document under 1.18:</p>
<blockquote>
<p>1.18 “Commercial Target” means the Target for which Licensee is granted a Commercial License hereunder.</p>
</blockquote>
<p>and further on, &quot;Target&quot;:</p>
<blockquote>
<p>1.50 “Target” means a polypeptide, a carbohydrate chain, or any other molecule to which an Antibody binds or which an Antibody modulates.</p>
</blockquote>

<p>Ron is right. According to 1.18 and 1.50, “Targets” and “Commercial Targets” are not antibodies; they are the molecules <em>targeted by</em> antibodies.</p>
<p>BioWa uses these terms as part of the licensing of its core technology. That technology makes antibodies more effective at destroying disease cells. (In <a href="https://www.kyowakirin.com/biowa/news_releases/pdf/2019/pr_biowa_cantargia_2019_08_23.pdf" rel="nofollow noreferrer">their words,</a> it “generates antibodies with enhanced antibody dependent cellular cytotoxicity.”) In addition to using this technology to improve antibodies it develops, BioWa also licenses its technology to other companies. If BioWa’s technology can improve a Licensee’s antibodies, the Licensee owes BioWa a fee.</p>
<p>As part of its Licensing agreements, BioWa specifies which molecules a Licensee can target. According to <em><a href="https://www.sec.gov/Archives/edgar/data/0001175505/000119312513338467/d536956dex1030.htm" rel="nofollow noreferrer">Article 4: Target Designations,</a></em> a “Third Party Reviewer” keeps a list of all targets. The targets are either:</p>
<ol>
<li><em>licensed non-exclusively</em> to 3d parties;</li>
<li><em>kept</em> for BioWa's own drug discovery programs; or</li>
<li><em>licensed exclusively</em> to 3d parties.</li>
</ol>
<p>For obvious reasons, the targets in 2) &amp; 3) are called &quot;exclusive targets.” Depending on how much profit they expect to make, Licensees may be willing to pay more to get an “exclusive target” designation.</p>
<p>The goal of all of this is to end up with what BioWa calls (1.44) “product,” a drug that contains “an Antibody to the Commercial Target obtained through use of the Licensed Technology.”</p>

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