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

To: Icebrg who wrote (37)	6/7/2003 1:45:17 PM
From: nigel bates	Respond to of 109

the only valid assumption I can make Maybe. I woud be more inclined to take their statement at face value: ...Working capital and other corporate purposes, which may include the acquisition of other businesses, products, product rights or technologies and the repurchase, redemption or retirement of other existing indebtedness. Cephalon does not currently have any definitive agreements, arrangements or understandings with respect to any such uses... They have taken advantage of market conditions to give themselves considerable financial flexibility, and I'm not sure that they have decided definitely what they are going to do with the cash. I guess we'll just have to wait and see if they can be as opportunistic in spending the cash.

To: Icebrg who wrote (37)	6/7/2003 1:45:40 PM
From: dalroi	Respond to of 109

Erik Care to guess what is the target ? 1/they are in pain therapie/ neurology so probably it should be a co in the same line 2/ it should ve a none selling drug on the market or a drug near market 3/ reasonably priced 4/ perhaps one of the eln "victims" ? 5/ or the one who produces that antiemetic drug? cheers Stefaan

To: Icebrg who wrote (37)	6/7/2003 3:32:31 PM
From: NeuroInvestment	Respond to of 109

Erik: Thank you for the very concise summary of the CEPH debt. I rather doubt that the majority of observers are focusing their concern on the billion+ debt due several years down the road. My guess is that there is some trepidation regarding what they will do with the billion + in cash they now have available. I do agree they are amassing cash for an acquisition. But M&A is often/usually not viewed as immediately benefiting the acquirer--as exemplified by the case of the now-moot merger between NPS and Enzon. While CEPH could add something to CNS, pain, or oncology, I would bet on the latter. It is what they wanted to do with SIRtex, give the Actiq reps something else to sell, and that will likely still be their emphasis. I'd rather see them do something creative on the CNS end, but Baldino is now hemmed in by the illusion fostered on the Street that missing analyst consensus estimates by a penny is some type of catastrophe. It is almost impossible to find a useful CNS program for sale that is going to add to the bottom line in the immediate future. Growth strategies thus are held hostage to the falsehood that shareholder value can be accurately appraised by each quarter's results. Anyways, I think that companies in a position to raise capital in up cycles such as this have to do so--failures of omission have come back to haunt many. This applies to NBIX as well. Harry Tracy NeuroInvestment

To: Icebrg who wrote (37)	6/10/2003 11:43:39 AM
From: Icebrg	Read Replies (1) \| Respond to of 109

S&P assigns Cephalon Inc ratings Tuesday June 10, 10:46 am ET (The following statement was released by the ratings agency) NEW YORK, June 10 - Standard & Poor's Ratings Services said today that it assigned its 'B+' corporate credit rating to the emerging specialty pharmaceutical company Cephalon Inc. At the same time Standard & Poor's assigned its 'B-' subordinated debt rating to Cephalon's existing $600 million 21/2% convertible subordinated notes due 2006. It also assigned a 'B-' rating to Cephalon's proposed subordinated issues. These include $300 million in zero coupon convertible subordinated notes due 2033 (putable in June 2008) and another $300 million also due 2033 (but putable in June 2010). The outlook is positive. Following the transaction, Cephalon will have approximately $1.3 billion of debt. Cephalon plans to use the proceeds from the proposed convertible issues mainly to refinance its existing 51/4% convertible notes due 2006, as well as to finance acquisitions. The company may also be stockpiling cash in anticipation of increased marketing support for one of its products, Provigil, a drug related to sleep disorders that Cephalon is currently hoping to market for uses beyond those currently indicated by the FDA. "The speculative-grade ratings on West Chester, Pa.-based Cephalon reflect the company's aggressive growth strategy and leveraged financial profile, factors mitigated by the growing cash flows from the company's two main pharmaceutical products, Provigil, as well as Actiq," said Standard & Poor's credit analyst Arthur Wong. Provigil, which has been approved to treat excessive daytime sleepiness associated with narcolepsy, is expected to have sales in the $120 million area for the six months ending June 2003, up from roughly 30% for the same period the previous year. The drug accounts for roughly 40% of the company's total revenues. Despite its FDA-approved indication, however, much of Provigil's growth can be attributed to "off label" uses. These include treatment for sleepiness associated with disorders such as depression and Attention Deficit Hyperactivity Disorder (ADHD). So that it can market Provigil for these diseases, Cephalon is pursuing supplemental new drug applications (sNDA). If the company is successful, product sales may reach $500 million by year-end 2005. There is some concern, however, regarding Cephalon's patent position on Provigil. A number of generic companies have filed abbreviated new drug applications (ANDA), and, if successful at contesting Cephalon's patent, they may be able to enter the market with generic Provigil by mid-2006. Actiq, which has been approved for breakthrough cancer pain, is expected to have sales in the $100 million area for the six months ending June 2003, up more than 100% from the same period the previous year. Although Actiq accounts for only about 30% of the company's total revenues, the cancer market is relatively under-penetrated, and the drug will continue to be an important contributor to growth in the company's cash flows. Cephalon has experienced substantial revenue growth during the past three years. The company is expected to continue to be aggressive, acquiring products and businesses with cash raised through its convertible debt offerings. Complete ratings information is available to subscribers of RatingsDirect, Standard & Poor's Web-based credit analysis system, at www.ratingsdirect.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com; under Fixed Income in the left navigation bar, select Credit Ratings Actions.