Zonagen (zona) - good buy? Message Board

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Biotech / Medical : Zonagen (zona) - good buy?

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To: Brander who wrote (3064)	3/26/1998 12:39:00 PM
From: Jacques Chitte	Read Replies (4) of 7041

OPkay, let me just sum things up from the "dummy's eye view." On the plus side: Zonagen has two patents for a novel formulation of phentolamine for ED. An oral formulation is a good thing in terms of patient compliance/convenience. Zonagen has a commitment from SGP to market the drug. SGP has already received approval to market Vasomax in Mexico; this gives the company a test market. Phentolamine is certainly no stranger; it's been approved before for managing hypertension. The drug has a track record. On the minus side: Pfizer's Viagra is effective and ready for market "any day now". Phentolamine is marginally effective for ED intracavernously, and oral phentolamine's effectiveness is... controversial. Questions remain whether an orally effective dose of phentolamine is going to have bothersome/worrisome side effects. Zonagen has not filed an NDA. Once Zonagen has filed an NDA, it'll take time for the review. Zonagen won't be "first to market" with an ED treatment. Vivus was, and they aren't making truckloads of money. The NDA for "non-life-threatening" indications is tough. Phentolamine might win approval for hypertension, but a high incidence of side effects could easily cost it approval for a less urgent (?) indication like ED, male or female. I'm playing this one short (for now), and the recent price action has been no fun for me. I do not hold with the camp that declares Zonagen to be a "fraud and a scam". I do believe that Zonagen is trading well north of "fair value" on a promise for "hard earnings" which I don't see coming anytime soon, for reasons outlined above. I wouldn't be surprised/betrayed to see Vasomax ultimately get NDA approval. But I think the chances are less than even that it;ll happen, and if it does it'll be late. Sorta a biotech Y2K story: there's an impossible deadline here, and even with Zona's milestones being hit one after the other, time is not on their side. Comments?

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