Tell you what. We have had some pain, short term. Having acquired this stock at 5 and held on to it at 46, watching the downward drift to the low thirties has not been emotionally rewarding. I know, there is a lot of pain left, and with every bit of it there is the risk of missing the next announcement. The short who gets blind sided by a good announcement will be hurt. Bad. The float is small and price moves come in jerks and jumps. A suit settlement may be a year away, but a POC device apparently could be announced at any time.
I was initially convinced that electsys was a winning system. Enough to believe that long term was the only sensible way to hold this stock - at least in my view. From that point forward it has been an evaluating process of where and how much it will win. And I have constantly maintained a conviction that the market has undervalued the stock. I felt it was undervalued at 46. Now, there is some analysis which tends to confirm that. Obviously, that lawsuit gives considerable cause for underevaluation - to the point where analysis puts huge figures on the potential value of settlement. I hold an opinion that Igen is run by one who is a winner; a man who plots his moves, who anticipates, who prepares, who foresees and forecloses - a man who doesn't intend to lose and who really doesn't know how to lose. Beyond the claims which the parties make, I don't know the facts of the matters at issue in the suit, but from a lot of legal and people experience I can say that it is very likely that this kind of man will have the facts to back up his claims.
No one wants to buy what has not yet been seen. Three drug companies have ordered huge devices which have not yet been produced, but at least they saw Igen rig together such a device and use it to do massive testing for Aguron. I think other drug companies will also be forced to order those, just to compete. The 2010 and 1010 devices have been seen, and orders have far outstripped projections. No one has seen the POC device, though it has been designed and the annual report showed a small module which could serve as the heart of such a device. I have a brother who is an ethical drug sales manager. We have had long discussions as to the eagerness of doctors to use an electsys device, assuming one shared a small spot in his office. If used only as an aid to diagnosis, or to measure effectiveness of treatment, I think it would border on malpractice not to have and use it. He, on the other hand, sees it as requiring one to be right up to snuff on his science and likely to introduce negligence and error and so subject the undertrained or underprepared physician to liabilty, and he feels there would be considerable initial resistance to its adoption. Well, I have been constantly amazed at the miniturization of test equipment, and at the eagerness of doctors to haul it out and charge you for its stat office use, and I believe a POC electsys would fly off the shelves so fast it would make a huge sucking sound on the way to the neighborhood doctor's office! Either my brother or I am wrong. My doctor doesn't hesitate to haul out his little EKG machine; he hands me a toy whistle looking device that turns out to be a Pulmonary Function Test (a device which used to fill half a room); and when he does a Proctoscopy now, we watch on TV as he punches it into my innards. And I think he will use a POC electsys. It will be a winner, when it is released. Now, if people would stop to think: the money isn't in the razor; it's in the blades. A lot of royalties are being fought over in that suit. Profits and royalties will flow from POC devices and the massive throughput machines, as well. Hell, they could distribute the things at cost and still make a bucket full of money, because ultimately, the profits will flow from he supplies used by each unit. The risk is that the bickering will let Abbott slip ahead of the pack, and I just hope that Igen is watching that, too! |
