Purinex, Inc.

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I. CASE FACTS Purinex was a drug-discovery and -development company based in Syracuse, New York, that sought to commercialize therapeutic compounds based on its purine drug-development platform. Purine was a naturally occurring molecule that played an important role in numerous biochemical processes. Purinex had developed a process for creating small molecules that acted as selected agonists (activators) or antagonists (blockers) for specific purine receptors in the cell membrane. Purinex’s goal was to develop products that evoked a receptor-specific pharmacodynamic effect without producing undesirable outcomes that could result from interactions with other receptors. The company had 14 employees and maintained a chemistry laboratory a…show more content…
2. The proposed deal for the treatment of sepsis and the deal for diabetes. The company planned to take its new receptor-selective drugs into clinical trials to address a broad range of potential indications. In June 2004, the most promising indications for its compounds were for the treatment of diabetes and sepsis. Because of this, the company planned to take a proposed deal, each has an estimated combination of up-front fees, milestone payments, and royalties that are to be evaluated in order to gather a significant impact for the company which might be possible for six months. 3. Lack of capital. The firm had experienced no sales and no earnings. It is the very concerned of the firm because it had only $700,000 cash on hand which is good only for 11 months. Monthly burden is $60,000 a month, which offset about $100,000 of the company’s $160,000 in monthly expenses. 4. The funding through seed money from individual angel investors and venture-capital. The company has the option to choose which from the two investors can provide additional capital that has only lower risks and can give the company the higher value. These two investors have different risks it provide for the company and it must be evaluated first in order to identify which of these investors best suit the company’s need. V. ALTERNATIVE COURSES OF ACTION 1. Evaluate the financing options and determine which one from the three options
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