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Biotech / Medical : Paracelsian Inc (PRLN)

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To: John H. Farro who wrote (1832)2/20/1997 11:33:00 AM
From: Hank   of 4342
 
Robin,

I agree that it would be in East West Herbs best interest to make a go of it. However, I've seen alliances like this not live up to expectations before. A classic example of this is a new comany called Intelligent Medical Imaging (IMII). They have a new automated microscopy machine out for the processing of clinical samples. It's a very novel piece of machinery that should gain market share easily. IMII established a collaboration with Coulter, a leading manufacturer of clinical blood analysis equipment, with the understanding that Coulter would market IMII's new machine. The stock took off from an IPO price of $11/share to over $20/share and then stabilized at around $14. Now it trades at around $6. Do you know why? Because during the last quarter, Coulter failed to sell even one machine for IMII and IMII has stated that they may fail to sell any this quarter either. I'm very familiar with the technolgy involved in IMII's machine, so I do not believe this is due to a fault with the equipment. I
know there is a big difference between the economics of selling a piece of laboratory equipment that cost over 100K and some herbal extracts that should only cost the consumer $60 or $70 a month. However, there is no guarentee that East West's attempts to market AndroVir will be as successful as everyone would hope. It depends heavily on the marketing skills of the people at East West and their financial ability to undertake an effective marketing campaign. Just trying to point out potential weaknesses here. It's always the details you least expect to have trouble with that nail you if you aren't careful. I know absolutely nothing about East West, how they are run, their financial condition, etc. It would be nice to know more about them.

Hank
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