Paracelsian Inc (PRLN) Message Board

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Biotech / Medical : Paracelsian Inc (PRLN)

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To: Hank who wrote (2387)	4/16/1997 3:39:00 PM
From: JOHN F. MORGAN	of 4342

Hank: Simple solutions to complex problems. Incidentally I got off my rear and checked an old Value Line (10/11/68) which indicates a complete line of life and health programs. (I dont throw much away.) Am still having problems with page 26 of Smith Barney packet. Has anyone seen a current business plan? AndroVir Per my previous post, dosage at 10 mg per kg body weight at 210 mg per capsule will treat a 46.25# HIV person. Initial dosage was 5 mg per kg which would be about right for 100# person. Pretty far gone for a male. Will someone please check me on this. Economics Cost per bottle (30 day supply) to patient $60.00 Selling price to PRNL $30.00 Gross profit Year 1 (I assume per bottle) $21.60 Cost to patient per day $ 1.97 Gross profit % year 1 __ 72% My new questions: (1) Cost per 30 day bottle $60/30 days = $2.0/day not $1.97 (I probably used more care when I did it with my slide rule.) (2) Is company's marketing program to sell direct? $30 cost + $21.60 = $51.60 $60 cost to patient leaves only $8.40 for retailer or 14% gross margin assuming that the $51.60 includes delivery to retailer. If shipping and handling arent included, the retailer's margin will be even less. I haven't checked WalMart's margins nor have ever been associated with this type business but find it difficult to believe that someone can keep doors open at 14%. (3) Gross margin %= Gross dollars profit per unit/ selling price =(21.60/51.60) 100 = 41.86% or =(21.60/60) 100 = 36.0% depending on how marketed. Certainly not 72% as stated. Mark Up = 21.60/30*100 =72% This may seem like nit picking to you but to me it shows a void in cost accounting and potentially a blind spot in marketing. Travelers might be well advised to assign someone to consult in areas of no expertise. If my conclusions are correct, now is the time to shore this up before it becomes a problem. Things like this destroy the credibility of a company. I hope that this will be received as a constructive post. It really consists of objective questions which I have. John

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