ANDRX-Reaffirm Outperform Recommendation-Gruntal Research Message Board

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Biotech / Medical : ANDRX-Reaffirm Outperform Recommendation-Gruntal Research

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To: PAUL ROBERT ST. ONGE who wrote (4)	11/8/1996 3:43:00 AM
From: James Silverman	of 23

Paul, My experiences with drug delivery firms has been terrible. KV, ETHCY, GNTA (i made a little on it overall-one of the few). I'm just a bit skeptical of the whole sector. Everyone seems to have once a day capabilities now. Its not unique anymore re: AZA, ELN 10 yrs ago. Thats not to mention transdermal hormonals which at least a half dozen are working on. The first two ADRX drugs are Cardizem and Dilacor. An AB rate Dilacor will not do that well. Somewhere south of $50M and north of $10M in annual sales. Cardizem is the NT bread and butter. I am concerned about the 30 month delay of generic once dailies. This would peg the entry point at March 1998. I am just a bit skeptical that they can circumvent the courts and get this thing out there any sooner. Are there any precedents regarding generic ab rated once dailies that you can uncover? RE: how long do they usually sit as an ANDA pending approval? How long did the Biovail drug Tiazac (basically ab dilacor) sit at the FDA? Thats about the best comparable I can think of. Clear answers to these questions will answer a lot regarding timing of the first ADRX products. I do agree the stock looks promising, however i question the likelihood of an $80 share price ($1.2B ++) in 3 years for essentially a generic drug delivery company. Bear in mind that Watson owns 20% of ADRX, they have rights (50/50 split of profits) to Dilacor and Cardizem plus the first 6 or so drugs ADRX is developing. Additionally drug distributing (where the current sales are coming from) is a very LOW margined business. Whats more important is they may get a little CF from it, as well as gain access to future customers of the higher margined once dailies. Jim

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