Aviron Message Board - Msg: 1857052

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Biotech / Medical : Aviron

AVIR 3.090

+0.8%

12:59 PM EST

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To: Brad C. Dunlap who wrote (40)	7/29/1997 12:25:00 AM
From: Vector1	of 645

Brad, the company line is that Ayerst sold its rights because they were shifting their primary focus to womens health. No I don't completely buy that either. I think the real answer includes the fact that 5 years ago drug companies were much less bullish about vaccines in general and most importantly I think most people were frankly surprised at the stenghth of the latest results. Thats why the stock was in the single digits earlier in the year. The results fundamentally change the valuation. Based on these results approval looks like a lock. In terms of market as was previously posted there were 80 million flu vaccines administed last year. The average cost was between 12-15 per person depending on the location. Over 70% of the cost was attributible to the cost of the giving of the injection by a health professional. The actual cost of the vaccine was about $2.00. Because of the ease of administration the Conpany believes that much of the heath care provider cost can be taken out of the chain. THey also believe they will be able to achieve premium pricing. Robby Stehhens analyst estimates $10 per vaccine. That may be a little high but I believe the nasal administration will greatly expand the market. Very few children currently recieve the vaccine and Aviron is obviously targeting that market. Although I consider myself a Peter Lynch follower I think its interesting to apply a common sense approach. Ask someone you know whether they would pay a few bucks extra for a nasal vaccine as opposed to an intramuscular injection. Then ask them about their children. Moreover, while the flu is not a killer in most cases it does make one awfully sick and results in missed days of work doctor visits andoverall loss of productivity. A easily administered vaccine that has high efficacy has tremendous economic value. Finally as an investment profession I agree it is highly unususal for a stock to gain almost 10% on the day a seconday is announced. Aviron chose three underwriters who I can guarantee you were fighing hard for the business. THis stock will become more and more high profile. Anyone who shorts this puppy better be prepared to cover because after the offering if there is more good news (like a jv with a big pharma on some of their other products) the momentum boys will drive it. Maybe then it will be a good short but not now V1

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