Sepracor-Looks very promising Message Board

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Biotech / Medical : Sepracor-Looks very promising

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To: Bob Swift who wrote (3363)	6/25/1999 8:47:00 PM
From: Art Vandelay AIA	Read Replies (2) of 10280

FYI, I am less concerned about this month's xopenex sales than later in the year. This quarter will be primarily shelf stocking, not sales to end customers. I suspect that the $4 MM number will be easily reached. Hopefully, we will have DCL filed by October which IMO will lesson the scrutiny on xoponex sales. By the way SGP indicated that they will be able to keep generic claritan off the market until october 2004. That gives them almost five full years to work on the switch. If the drug profile is strong the switch percentage will be huge. Overall, I am obviosly not pleased with the stock action. Why did fidelity buy in the $120 and sell below $100 3 months later????? No doubt that the earnings push back didn't help. I think that SEPR is communicating a lose business model that many analyst are taking literally. For SEPR to spend $300 MM in annual R&D in 5 years is a little hard to accept unless the initial 5 - 10 products are homeruns. SGP only spent $1 BB last year and they have $7 BB in sales and $60 BB in market cap. SEPR has a disconected assumption regarding expenses. Over time the R&D number will reflect the current sales potential and may be higher or lower. That is why I beleive that the company will in fact be profitable in 2001. More likely, they will partner more products and the expense expectations will subside, but wall street isn't willing to make this leap of faith. SEPR needs to be careful and continue to be conservative in their timing of clinical progress and expected expenses. The only announcement going forward should be for acceleration of schedules and lower expenses needs. To many development projects have had samll to significant delays. NORI was supposed to be on the market today and certainly by the end of 2000. Now we are looking at 2001. Xoponex all forms was supposed to be on the market by the end of 2000. Looking more likely to be 2002. The tablet and the syrup should be approved in late 2000 or early 2001. Oxy was projected as 2001 and now looks like 2002. Propulsid was projected to be 2001 and now looks like 2002. On the positive, DCL and potentially R-Flux will be 6 - 12 months ahead odf schedule and they are large so they may make up for all the others. I think that the forecasted earnings momentum has subsided. 6 months ago all projections were hinting at future increased in EPS projections. Translated only more upside suprises to come. This bias has been excluded from the current analyst comments. IMO this is the bioggest factor for the stock weakness. The major positive is that most of the project delays can still be launched by the 2003 timeframe, which is the real measurement for SEPR at this point. By the time we/the analysts focus on 2004/5 we should refocuss on the potential for upside suprises. Good luck all and have a nice weekend, HPPOLK

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