The following post is from another board:
<<1. CNBC report was around the opening bell. While talking about Zona, they had a banner at the bottom of the screen, above the tape, stating that many observers doubt Zonagen's pill works. Obviously someone or some group who was negative got Joe Kernan's ear. He was obviously not aware of all the facts. He stated the deal was $10 million plus royalties. He never mentioned the extra $47.5 million in milestone payments. If any of you have ever
had experience listening to the media report stories that you have independent knowledge of, you realize how little of the whole truth they usually know. Since most of the time we have no independent knowledge, we tend to take what they say as gospel. It is not! Much of the discussion degenerated to giggles between Kernan, David Faber and the host. They shivered at the thought of Muse and speculated on pills being used to augment functional men.
Any reader of this board would have been able to offer far better information. They do have an effect however and IMHO, their comments had a lot to do with the stocks performance today. Score one for Pfizer, the analysts who would look bad if Zonagen does well and the shorts.
The conference call went extremely well. The reason for not releasing exact royalty figures is Schering, which feels that making such information public would reveal something of their cost structure to Pfizer and put them at a competitive disadvantage. Both Podolski and Sutter emphasized that the royalty figures exceed what analysts and the street have been saying. They were ecstatic about the royalties and the deal in general!
They chose Schering because of their aggressiveness in wanting this drug and their demonstrated willingness and ability to go head to head with Pfizer. The feeling is that this could develop into a major drug for Schering, both here and abroad. Schering and the other companies closely scrutinized reams of data before making this decision. Despite CNBC's Kernan cavalierly dismissing the $10 million upfront payment, This is a significant committment
that Schering would not have made if the data were anything but genuine. Schering feels that Vasomax has some significant advantages over Viagra. For competitive reasons, Podolski wouldn't get into them but readers of this board should be familiar with them.
Filing for an NDA will be coordinated with filings world-wide and they were told by the FDA that if they filed before Viagra received approval, they would get fast track status.
BTW, Merrill Lynch issued a reserch report today on Schering saying that Vasomax will be a significant new drug for Schering in a fast growing market. They said it could generate $200 million in sales for them. They didn't give a time frame but I would think the potential is greater than that down the road.
Zonagen is aggressively developing their other products with their large reserves of cash. Podolski will be visiting with institutions tomorrow. I think patience will pay off with this stock and the fact that it hasn't gone up yet presents a buying opportunity. My friend, TradeOex, is one of the few people who have great instincts for getting in and out of a stock. For those of us not as gifted, Zona may present a long term opportunity to profit
in a big way. Although I would feel better with him in this stock, I think it will, sooner or later, act in a way consistent with a development stage company which has just been validated by a major Pharmaceutical. As I have consistently stated, Zonagen is not without risks, But I believe it has a huge upside and this news today does take some of the risk out of it. |
