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Biotech / Medical : Incyte (INCY) -- Ignore unavailable to you. Want to Upgrade?

To: WTDEC who wrote (1133)	9/11/1999 11:25:00 AM
From: A.J. Mullen	Read Replies (1) \| Respond to of 3202

Good point Walter. And thanks RCMac, I was worried that the agreements already in place with pharmas would be up for renegotiation if they had been based on intellectual property that wasn't in fact Incyte's. I am still puzzled though, I though micro-arrays were the basis of Incyte's business. - AJ

To: WTDEC who wrote (1133)	9/12/1999 11:26:00 PM
From: RCMac	Read Replies (3) \| Respond to of 3202

>> it seems more likely than not to me that the two releases were coordinated by the lawyers at each company. IMO, and for whatever its worth . . . I see this as a positive sign that communication between the parties is occurring which could eventually lead to a settlement.<< Nice point, Walter. I had noticed the timing of the releases, their mild tone and absence of zingers, and thought it fairly civilized for these two litigating parties, but didn't go on to draw the (IMO, reasonable) inference that you did - that maybe there is a bit of progress towards a truce. I don't expect anything quickly, though, after the history between these two outfits. I might note that in my "worst-case-isn't-a-disaster" post I made the worst case worse than it is, since my arithmetic in effect assumed that all the microarray revenue would fall right to the bottom line, so that its loss would subtract all that revenue from profits -- plainly incorrect. I have no idea what INCY's margins are or might be on the microarray business, but they aren't 100% -- possibly unprofitable at this early stage of the business. In any event, that is a static and not too useful thing to say -- the microarray business would surely (and perhaps will) be worth a lot some day, and if it's lost that will hurt, somewhat, INCY's value. I should say that I don't assume, I just don't know, that INCY is knocked out of microarrays by this decision (assuming it's upheld and ultimately spawns an injunction). I don't know (1) just how much the INCY/Synteni microarray business depends on the patents that may be knocked out by AFFX's patents, or if there is room around those patents, or within INCY's other microarray patents, to run a decent microarray business (although the decision will surely shift some business to AFFX from INCY), (2) whether INCY has other patents (or other technology) that AFFX needs or might find useful to license, in a comprehensive deal, increasing AFFX's openness to a deal, or (3) much at all about the microarray business. My post of early Saturday was just making the point that, even if the worst happens and INCY is knocked out of the microarray business, it is only a bite out of a small non-core (if nicely related) business, not a large disaster (although the market may treat it as a disaster on Monday). Anyone - Rman? - have a better handle on these issues? --RCM