Subject: Re: Intelligent discussion on Japan Tobacco?
Date: Sun, Dec 7, 1997 20:12 EST
From: JWhite6892
Message-id: <19971208011201.UAA08249@ladder02.news.aol.com>
Lets examine the partnership with Japan Tobacco. First of all, the relationship seems much better than Roche in that, JT provided a lot of clinical support and a few bucks for the development of Viracept. More importantly, they have profited in a big way from their initial investment. I am sure now, that JT is very happy with their investment. Now if we consider also that besides the cancer research that Roche was supposed to pay, JT has committed
quite a bit for the development and profit sharing of AGPHs most promising revenue drugs with exception of the GART and MMP inhibitors.
Just after a few months on the mkt, JTs royalties make their partnership with Agouron for the next 5 yrs risk free, in that the money that they will provide for R&D of the viral blockbusters has already been exceeded by the royalties that have been paid. Nice position for JT.
I am sure the last thing JT wants is for their partner to go under or fall behind with the competition that is trying to catch up with AGPH on blockbusters like a Hepatitis C PI (that recently Chiron-Arris-and Big Pharma sugardaddy have announced development of because the mkt is huge). I am sure JT also wants a piece of the action of the cure for the common cold receives the medi attention and the the streets attention. Remember when the first HIV
PI in pediatric form was approved by the FDA (Viracept), JT was quick to announce their association with this pharmaceutical milestone, this puts JTs pharmaceutical division considerable clout in the world mkt. Jt like most Tobacco companies, is knee deep in cash and would be very intersted in branching the drug division into the global forefront as they did with this HIV PI. Can you think of a better place to put cash in for JT, compared to what
they already have gained from Viracept.
I do not know how the future with JT will turn out for sure. But I am sure they took notice of the Roche departure. It would make good business sense for JT to take over the ROCHE deals and further tie their dependent interrelationship with Agouron, besides getting a major foot in the door for Cancer Therapy. I am also relatively confident that the departure of Roche was received well by JT. Agouron is more theirs now. Lets assume a possibility. Jt
starts buying more shares of Agouron at these levels, until it gets noticed and reported and then announces that they will take an x% of the company and will replace Roche in the partnership deal with AGPH, further joining JT and Agouron, and being quite profitable immediately for JT because the price would be pressured to new highs as the shorts would have to scramble out even faster now. (they really are running out of the same lies, people are
starting to figure this out like , oh I don't know, George Soros. Also think if Soros would increase his stake in AGPH at these levels from 2.2% to 5%, the news alone would flush out this huge short position and make George another quick score. This type of short flushing is not rare and Agouron is a prime candidate for this type of play. I think it would make more sense for JT to acquire AGPH, but Peter Johnson is set to make Agouron the next Amgen
and I feel he and the board have no inclination to sell out.
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