Elan Corporation, plc (ELN) Message Board

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Biotech / Medical : Elan Corporation, plc (ELN)

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To: William Partmann who wrote (423)	7/26/1999 1:35:00 PM
From: Lance Bredvold	Read Replies (2) of 10345

Reading this press release and making an effort to get my arms around Elan as an operating company leads me to a vision of Elan as a sort of venture capital firm. Though I have never seen at close hand the types of firms that Elan makes all these deals with, I am imagining graduates in biotechnological firms having a bright idea to start their own company based on some esoteric specialty and succeeding in getting it going, probably hiring some more people and leasing a building on one of the beltlines of the world. Then they get some papers published and run out of money. Now they need somebody to add to their resources, probably both in terms of related expertise (like delivery) and money and perhaps credibility, but the owner does not want to give up his baby. So Elan buys a bunch of stock which has been authorized but not issued (but why far over the market price?) and gets some options (I guess that's to compensate for paying over the market price for the stock) and probably some exclusivity to the possible product of this subsidiary. But why do they buy stock in Targeted Genetics which then uses the money for one specific subsidiary company? I read the case about Fuisz and was embarrassed by the things Elan was alleged to have done. I imagine those are detrimental to Elans ability to form this type of relationship and that the bigger companies need to have a good reputation in dealing with these smaller companies. But when I try to look at the bigger picture, that case was probably based on Dr. Fuisz feeling he was not being treated a importantly has he thought he should be. From Elan's perspective it was one small deal in very busy day's and perhaps they were not a quick as they should have been in returning calls and such, but there were a lot of other things to be done. I'll bet there are a lot of prima donnas in the relationships Elan tries to form. I suppose all I really am doing here is developing a view of Elan, and no response is necessary unless my thinking generates some new thinking in others or if I am viewing this business wrongly--and like the blind man with the elephant, it is just one small view of the whole company. Sincerely, L.

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