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Gold/Mining/Energy : Nuvo Research Inc -- Ignore unavailable to you. Want to Upgrade?

To: toccodolce who wrote (9128)	3/29/2002 1:59:08 PM
From: Montana Wildhack	Read Replies (1) \| Respond to of 14101

Tom, Note the use of prescriptions went up 7% (2.9 to 3.1) while price increases averaged 10%. I would also suspect a measurable part of the move to more expensive drugs were (for example) tylenol to celebrex for people who had previously reacted to (for example) ibuprofen. I have always felt once effectiveness was determined with safety, the third key success factor was price positioning (second being approval). That is lowest cost NSAID alternative. Pennsaid should move some off Aspirin/Tylenol options and back unto NSAID (topical), while some move down to topical from systemic NSAID (poor tolerance, pill issue, single joint, variable time sufferers), and thirdly some new market from non-arthritic inflammation (think recurring elbow inflammation from squash addicts, knees/fingers/wrists from tennis fanatics). Many will want to extend sports involvement in life and Pennsaid public marketing should send this message as part of the media campaign. Its at this time that examining the J&J business proposition may be useful. Say an average Tylenol bottle wholesales for $6. J&J may earn as much as $4.50 from that bottle in a stable market space. Pennsaid might wholesale for $40 (I'm hoping for high 30's) of which hypothetically they might give DMX $10. Their total cost investment is probably in the $12 range per unit. [Dont forget Pennsaid has a 2+ year shelf life but has a 30-45 day expiry date once opened] From J&J's viewpoint, although they are replacing current sales for some section of the Pennsaid target market, it is at a roughly 4 for 1 revenue contribution per unit. The majority of the revenue (non Tylenol) will be net new. Reflecting back to market size: I have been using $10 billion as 2004 market size. This is less than 10% compounded growth from the 2001 $8 billion estimate and has no price increases. I posted that grid showing DMX variable revenue per % market penetration. I'm off now to make another one. While there were different components to the net 17% posted by Tom, it mentioned Arthritis specifically and can be safely assumed the Arthritis portion was in excess of 17%. (Otherwise they wouldn't have mentioned it as a contributor while averaging to 17%). I will therefore use 15% average (the true bulge in the baby boom bulge is just beginning to pass 55 and future releases of this data will show this is still quite conservative) and I will use a 5% average price increase. BTW - when the politicians deal seriously with the out of control health costs 5 years from now the major arthritis target should be COX2 although I believe we will be seeing legislated price freezes over multiple years somewhere after that timeframe (2007). A few chores and then I'll make and post that DMX revenue grid for those with some time to kill. Happy Easter to everyone of every faith, Wolf