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Biotech / Medical : Biotech Valuation -- Ignore unavailable to you. Want to Upgrade?


To: A.J. Mullen who wrote (5314)1/3/2002 8:09:03 PM
From: tom pope  Read Replies (1) | Respond to of 52153
 
ABGX is being slammed after hours (last trade 25.62) on the basis of this:

The primary efficacy endpoint was the proportion of patients achieving an ACR 20 response at Week 12. An ACR 20 response requires a greater than or equal to 20% reduction in swollen joint count, a greater than or equal to 20% reduction in tender joint count and a greater than or equal to 20% improvement in three out of five of the following: patient's assessment of pain, patient's assessment of disease activity, investigator's assessment of disease activity, acute phase reactant (CRP) and patient's assessment of functional status (HAQ score). In an analysis of all randomized patients, 31% of placebo-treated patients achieved an ACR 20 response at Week 12 compared with 34% of ABX-IL8-treated patients. In a subset analysis of patients with more active disease (the 70% of patients in the study who had greater than or equal to 12 swollen joints at baseline) 41% of ABX-IL8-treated-patients achieved an ACR 20 response compared with 27% of placebo-treated patients. Additionally, a correlation between serum levels of ABX-IL8 and clinical response was observed. Forty-seven percent of patients with ABX-IL8 serum concentrations above the median level achieved an ACR 20 response at Week 12, compared to a 33 percent ACR 20 response rate in patients below the median. Despite this evidence of anti-inflammatory activity, the magnitude of the benefit did not meet the company's criteria for moving forward to a Phase 2b study.

The complete release is on the ABGX thread, and also on biz.yahoo.com.

Over reaction, or another IMCL?



To: A.J. Mullen who wrote (5314)1/3/2002 8:16:15 PM
From: IRWIN JAMES FRANKEL  Read Replies (1) | Respond to of 52153
 
Taxation of court awards whether by jury or the court is a function of what the damages replace. I think a lot of the confusion comes from the non-taxability of injuries to a persons body. But if damages replace wages or in the case of a corporation replace money that would have been income then it is taxable income.

Some types of damages may even be subjected to additional taxes. In some states punitive damages are taxed at higher rates, confiscatory rates (IMO).

ij



To: A.J. Mullen who wrote (5314)1/3/2002 10:46:26 PM
From: RCMac  Read Replies (2) | Respond to of 52153
 
My understanding is that jury awards are not taxed. IS this so?

Ashley,

IJ has it entirely right. It seems clear that every dollar IGEN may receive in payment of a judgment (assuming we get one and it is affirmed by the Court of Appeals) will be taxable, at ordinary corporate rates (Federal plus state, apparently about 42%). IGEN has about $160M in net operating loss carryforwards to deduct against income.

That's the worst possible tax treatment. If there is a settlement (before or after verdict), there are a variety of ways to lessen the tax bite. Probably the simplest would be for Roche to buy IGEN, so IGEN shareholders get either cash for their shares (taxable at capital gains rates, i.e. 20% maximum if held for more than a year); or perhaps in a tax-free exchange for Roche ADR's, which could be sold whenever the former IGEN holder wanted to cash out, again at capital gains rates. Both ways avoid subjecting the settlement proceeds to corporate tax in IGEN's hands.

Lawfighter's summary of closing arguments has just been posted in a series of eight posts, starting here: messages.yahoo.com

--RCM