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Self-Protective Partnering

Executive Summary

A self-protective dynamic characterizes a licensing deal that Gilead just signed for its new hepatitis B treatment adefovir, which is expected to win regulatory approval shortly. By assigning to Glaxo product rights in Asia--the largest market for the drug, but beyond still-small Gilead's reach--the biotech firm assures that a big, strong competitor can't play too rough with it. Glaxo's tacit endorsement of the drug's quality should help Gilead's efforts to market the product in the US and Europe, where it kept rights.

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