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Biotech / Medical : Texas Biotech (TXB)

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To: Ken Crooks who wrote (288)	8/14/1997 4:36:00 AM
From: X. Fang	of 834

The most important thing to small-mid biotech companies like TXB is CASH. Although share dilution is not a good thing, but in most case it's the only way for small biotech to raise large amount of money. TXB still has several products in Phase I & II stage. I assume the money needed for those studies will be in $50million range. They only got $9 million from SB now, plus $5 million upon the acceptance of the NDA filing by FDA, which should be in Oct, 97. The rest of the SB's money and royalty could be months away. So I guess the management decided to raise some insurance cash. Because of so many positive news, it seems now is the better time to do the offering (at a good price). In the long run, I don't see this offering having a negtive impact on the stock price. In my opinion, one reason of the stock price drop in last few day is that TXB is in the extremely under-performing Biotech sector. Lots of momentum players and short-mid term investors will take profit on good news. Then there comes some panic. (NXTR is another example) BTW, does anyone know the pricing of those 5 million shares offering? Thanks

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