Cistron Biotechnology(CIST)$.30 Message Board

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Biotech / Medical : Cistron Biotechnology(CIST)$.30

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To: Vadim D. Marchenko who wrote (175)	11/20/1996 6:26:00 PM
From: scaram(o)uche	of 2742

Good. This is very different than anything that I've seen before. Let's work with it. Message from Vadim D. Marchenko on Nov 20 1996 4:33PM EST Buying CIST as a "Cash Cow" ? I just did some quick and dirty calculations, making the following assumptions which intended to make conservative : 1. CIST is getting $12m as their share of settlement over the next 4 years, PV @ 7% = $11.22m *********************** OK, can't get more conservative than that. I hope. ********************** 2. Immunex settled for 3 x what the patents are worth ( in other words assuming the patents are worth $7m ). ********************* Interesting. This obviously didn't come from thin air. Is this 3X used as a standard in some sector? ********************** 3. Stuff compensation =5 people x 80 hrs/week x 52 weeks @ $200/hr = 4.16m +$.84m for insignificant other = $5m. ************************ You lost me here. Are you taking out four years of operating expenses? *************************** 4.Taxes = .35 x ( 11.22 + 7 - 5 ) = $4.62m ************************** Some are assuming that the settlement will not be taxed. I don't know enough to comment. Bob? *************************** 5. Adding up the above = $8.6m or roughly $.31 a share. PLUS you get the rest of the company for free, including all other patents AND the name of the company that owns these patents, the very one that forced Immunex to settle out of court. IMHO it is worth some extra. ************************* I think this is the point that I feel strongly about, obviously. I feel that the existing business could be made to hum in short order. I did a medline on the inventor for the recent assay (IL-1beta in biological specimens) patent, and it looks like he may have moved on to Ortho. Not certain about that. The 10-K says that they have a senior scientist. Anyone know who it is? ************************************** Buying CIST @ $.30 a share looks like a good deal to me even if you totally discount the abilities of the management ( was quoted as being "brilliant" before) and turn around and sell off the pieces. The bottom line is I do not see how it could be valued below $.3. Any thoughts ? *********************************** Vadim......... OK, so you're saying forget about CIST's products, properties and license agreements, assume worst case is a bunch of clowns just babysitting the settlement for four years? Or am I lost? Interesting. Thanks. Rick

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