Bob:
Absent of any recent institutional buying/selling in SEPR the last few weeks, the Market Maker had the golden opportunity to take the price down to the high 30's, so that he can buy enough shares below the $40 level to deliver the stock to all the June 40 Call-Option holders. Now he has to worry about the huge open interest in the July 45 Calls, which I personally believe most of them would be excercised given the fact that we are getting closer to the FDA announcement regarding Levalbuterol (NDA submitted on August 1, 1997).
Also, note that for Eli Lilly to protect it's market share for Prozac, they would have to cut a deal with SEPR very very soon, otherwise, they run the risk of losing it to someone else, which they can NOT afford to do. Prozac is much too precious for them (25% of '97 gross revenues) to nickle and dime with SEPR over. Any favorable announcement with Lilly would give SEPR shares a $5-$6 pop on the up-side.
In addition, we also have the Court decision regarding the patent dispute with Hoest Marion, which I believe should be in favor of SEPR.
Finally, my indicators show an intermediate double-bottom around the $37-$38 area, which given the above news (if favorable) should take us back up to an all-time high in the low $50's within the next month or so.
On a last note, Wall Street will eventually wake-up one morning (which I hope would be sooner than later) and realizes the golden potential this Company has in trying to corner the Antihistamine second-generation drug market, which is estimated at approximately $6-$7 Billion by year 2000. Anyway, GOOD LUCK to all.
Mazen |
