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Biotech / Medical : Agouron Pharmaceuticals (AGPH) -- Ignore unavailable to you. Want to Upgrade?

To: Steve Fancy who wrote (2994)	11/25/1997 5:58:00 PM
From: JOHN W.	Respond to of 6136

Analyst Report dated November 24, 1997 from Brown Brothers Harriman & Co. OUTPERFORM/BUY AGPH: MAINTAINING OPTIMISM DESPITE MARKET WEAKNESS EPS Price ------------------------------------------ 11/21 6/97 6/98E 6/99E --------- ----------- ------------ ------------ $39 3/8 ($1.59) $0.75 $1.60 1998 Q1 0.11A Q2 0.14E Q3 0.30E Q4 0.20E 1997 Q1 0.57A Q2 0.46A Q3 0.18A Q4 0.38A AGPH shares have been trading downward lately, showing a weakness we attribute to the volatility in the broad markets, the weakness in the overall biotech market, and Friday's option expiration day. We believe the Viracept sales for the current quarter are on track to meet or beat our estimates of $82.6 million in sales and $0.14 per share in earnings. Although our estimates allow for the slowdown in patients added to therapy and dropouts, no such slowdown is evident. The prescription data indicates continued strength in both new patients starting Viracept therapy and total prescriptions. We look at weekly numbers cautiously, and consider the data to be indicators of a trend around which some randomness and variation are to be expected, rather than a direct predictor of sales. However, this trend is more favorable than we had expected. One of our cautions on the stock has always been that the HIV/AIDS therapy market is evolving rapidly, with many new products in development. Our expectations for sales and market penetration have always been relatively modest for this reason. We expect new drugs to be added to the current standard drugs, such as reverse transcriptase inhibitors and protease inhibitors (An analogy used by a speaker at the ICAAC conference was "more fences, and higher fences" to contain the virus). We do not see anything on the horizon that would revolutionize therapy and make other durgs obsolete, and continue to expect combination therapy with several drugs to be the way the disease is treated.