I just listened to a tape of the Informed Investors presentation by Faraz Naqvi of NationsBanc Montgomery Securities on 5/20/2000. Among the genomics plays his favorite is MLNM. He says that by 2004 or 2005 MLNM will be launching as many new drugs as Pfizer. He says that HGSI is following in the fold of MLNM, but some of its short-term products may disappoint analyst expectations. He's taking a wait-and-see approach to CRA while it figures out what business it is in. CRGN, a leader in SNP analysis, he calls a "great company."
Switching to MABs, he loves ABGX, which has a terrific patent portfolio as well as great products. PDLI has good short-term prospects, but may have more problems in the future proving up its IP.
In small caps, he was expecting great things out of CTIC at ASCO this past week. The same technology used in its lead product can be used to enhance the efficacy of a broad range of chemotherapeutic agents. He thinks CTIC's stock "could really take off." He calls "exciting" AVAN's product immunizing against hypercholesterolemia. He likes IMMU's new drug that mimics Genentech's non-Hodgkins lymphona drug and says that IMMU has a compelling technology for developing MABs. He says that CEGE is his one pure value play -- when you consider the value of its holdings in ABGX, CEGE's stock is so cheap that its technology is in effect given an negative value. PRCS, which just went public a few weeks ago, uses MIT technology to develop drugs from a "statistical perspective" and has exciting drugs for Alzheimers, prostrate cancer and endometriosis in women.
Among the "picks and shovels" companies, he calls PEB a core holding. He says IVGN is competing in the same market. He likes WAT, which is developing technology for proteomics R&D (high performance liquid chromatography instruments, chromatography columns/consumables, and mass spectrometry instruments). He has some concerns about AFFX, because he thinks Corning, HP, and Motorola may be about to enter the gene chip field.
He calls European Biotechnology a nascent area. He likes CLL, which has a rich pipeline (it recently acquired Cistron) and plenty of cash (CLL was created from a merger with Medeva, plc in January. Earlier this month, Robertson Stephens rated CLL a Buy, stating: ``We believe Celltech has one of the broadest development pipelines in the biotechnology sector. With its recent acquisition of Medeva, we think that Celltech is poised to become a profitable and rapidly growing pharmaceutical concern by 2003.") QGENF, a German company, produces and distributes biotechnology products (including robotic equipment) for the separation and purification of nucleic acids (DNA/RNA). He also likes GENXY (French) and SKYE (a British drug delivery company).
In the Q&A, he said ISIP has too much liquidity risk, even though he finds its technology exciting (Jim McCamant spoke at the same conference, saying that if ISIP's non-small cell lung cancer data turn out to be as good as he expects, a lot of people's opinions about that stock may change). Faraz also opined that the terms of LGND's collaboration with ELN are more favorable to ELN than to LGND. He praised "Avigen" for the brilliance of its antisense science, but I think he meant to say "AVI Biopharma" instead of "Avigen."
Marc |
