Hank, welcome aboard! I think your comments are welcome and perceptive. If AndroVir's distributers (East West Herbs) just sits on the product, then you are right. PRLN will be in real trouble. But I don't see any real economic incentive for them not to try to make a go of it. After all, they will be sharing in the profit. Christine Labastill is an analyst who went to the Smith Barny conference last week. She wrote up her notes from Paracelsian's presentation to the conference in post #1706. You might want to go back and read it. I don't think anyone knows all the financial aspects to the deal behind AndroVir's distribution. However Christine wrote the following:
--Assuming a 3.8% penetration of all AIDS patients in the first year on the market, AndroVir could generate $2.4 mill. in sales and make a $1.2 mill. profit contribution to PRLN. Likewise, AndroCar, the drug to enhance the well-being of cancer patients, is assumed to penetrate 1.9% of the cancer market (as measured by number of patients)in its first year, generating $4.0 mill. in sales and $1.6 mill. in profit for PRLN. Potential markets are $300 mill. and $400 mill., respectively.
--AndroVir expected to be introduced in May of this year and manufactured in East West's facility in Emeryville, CA. (No details given on the structure of the agreement with East West.)
--AndroVir assumptions: 210 mg. capsule form, taken three per day at cost to patient of $60 per month, or $720 per year. Selling price for PRLN: $30.00 (note from me--I'm not sure what this refers to). Projected gross profit: $21.60, for a gross margin of 72%.
--AndroCar assumptions: 350 mg. capsule form, taken three per day at cost to patient of $97.50 per month, or $1170 per year. Selling price for PRLN: $58.50. Projected gross profit: $37.95, gross margin 60%.
I hope this answers your questions. I agree with you. I don't think today's weekness means too much. It's possible the stock go go back down some more. Who knows? The true value of this company will only become apparent 6 months from now after AndroVir has been on the market.
Robin |
