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Biotech / Medical : Sepracor-Looks very promising -- Ignore unavailable to you. Want to Upgrade?

To: tuck who wrote (9653)	8/22/2006 12:40:41 PM
From: tuck	Respond to of 10280

Actually, checking my notes again, I see this meeting only has to do with the immediate release version of Indiplon. Most people agree the IR version isn't much of a threat, particularly without Pfizer. Staying with my sold SEPR puts. I'll be looking to short NBIX after they announce the meeting, no matter how it goes. Again, just my opinion, with my money behind it. Cheers, Tuck

To: tuck who wrote (9653)	8/22/2006 2:18:19 PM
From: Rocky9	Read Replies (1) \| Respond to of 10280

I have not done anything yet. I got burned selling puts on NBIX too early. I am still net long on SEPR so I have taken a beating there too. I have been thinking about selling some Sept SEPR puts but have not yet. Or I might buy some long-dated calls, at least to bring my total unhedged position up a little. I might have done something this morning on the drop if I had been in the office. As to NBIX, I'm now very leary to do anything until there is more visibility. I too think that PFE probably knew what it was doing, so the likelihood of a big winner is not good. OTOH, NBIX is more than Ind. And I'm not sure that SEPR can benefit too much in the long run unless the whole market starts expanding again. So I will probably sit on the sideline with with my overweight in SEPR and hope for a buy-out, or, less likely, growth in Lun. JMO.

To: tuck who wrote (9653)	8/23/2006 6:25:41 AM
From: Robohogs	Read Replies (1) \| Respond to of 10280

I have not done anything here recently - got burned on too many put plays in late spring. I am not loving the vols on SEPR these days and worry about selling puts given lack of a catalyst near term. Lunesta looks like it has reached peak at 120K per week - probably just under $600 MM annually and the Xopenex MDI and nebulizer can probably eventually get to $700-800 MM. I do think management will raise the MDI piece of estimates but nebulizer remains at risk. Assuming arformoterol can do $200 MM (aggressive) and you have peak sales at about $1.6 B maybe moving toward $2 B if Lunesta can get going again (with some royalties added in to get to this midpoint level). I imagine steady-state profits will be circa $3 per share moving toward $5 if L gets going again. So if you do not believe in L and worry about Xopenex, then SEPR trades at 15x steady state EPS. Not exactly cheap. Jon