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Biotech / Medical : VVUS: VIVUS INC. (NASDAQ)
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To: blankmind who wrote (3803)12/17/1997 11:52:00 AM
From: Musa Goksel Bulat  Read Replies (2) of 23519
 
According to first call estimates for Q4 is .18 and for Q1 1998 is .09.

I think they based it on the theory that VVUS won't be able to meet demand and increased add. spending will lower earnings.

Someone wrote that he talked to VVUS and they had two lines originally(they were able to make 8000000 units/month with these two lines) and they still have two lines at the old plant. They also have one line in the new plant which will hopefully manufacture for UK as soon as MCA approves the plant.

One of the concerns analysts had was increased inventory of wholesalers. (30 days to 45 days ). VVUS said this was actually the amount wholesalers like to keep and 45 days inventory is not enough for a major add campaign.

If VVUS is to run a major add campaign they should be manufacturing at a full capacity which is 800000 units a month. This will make total units avaIlble for sale in Q1 98 around 2100000 for domestic market.

If UK approval comes in early January they will have two months of full capacity of production for one line which is 800000 units for the whole quarter.

UK(population 58million) and USA(population266million) has similiar demographic structures. If UK responses to MUSE like US responded to initial launch, they could buy 400000-600000 units in Q1 easy. After hearing the succes of MUSE in States no one will wait for Viagra.

Assuming that VVUS is not changing plans for February add campaign,
it is very possible that they could sell around $40 million which means they could make $.23-$.28 and beat the estimates of $.09 by 150-200% easily.

If this happens, (i think very possible) what happens to stock price?
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