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Strategies & Market Trends : Sonki's Links List -- Ignore unavailable to you. Want to Upgrade?


To: Sonki who wrote (110)5/23/1998 12:12:00 PM
From: ANANT  Read Replies (1) | Respond to of 395
 
Can Dell really do no wrong - Latest Barrons article

interactive.wsj.com




To: Sonki who wrote (110)5/23/1998 8:24:00 PM
From: ANANT  Respond to of 395
 
Study on pre/post stock splits

this is a link from yahoo msg brds as a good future reference.

messages.yahoo.com@m2.yahoo.com



To: Sonki who wrote (110)5/25/1998 3:22:00 PM
From: Brian Malloy  Read Replies (2) | Respond to of 395
 
Sonki,
Be sure to read this article. We have talked before about using higher yielding stocks of quality companies like (Gillete, GE, MRK, KO and such) as a "surrogate/super" bond over the long term. This article explains the general idea better than I did.

Minding Your E/Ps to Unlock Profits
when you buy a bond, the interest rate you start with is the interest rate you keep forever; no one raises it by 13 percent, or even 1.3 percent.
washingtonpost.com

Hope you are enjoying the weekend,
Brian



To: Sonki who wrote (110)5/28/1998 9:24:00 PM
From: ANANT  Respond to of 395
 
Bus.Wk - June 8,98 News item about suit on Intel

BOOTING UP AN INTEL SUIT

THE FEDERAL TRADE COMMISSION staff may be ready as early as June 3 to recommend that the agency bring antitrust charges against Intel. According to sources familiar with the FTC probe, the staff may ask the five-member commission to charge Intel with using its dominance in microprocessors to hurt rivals. The staff is likely to present evidence that Intel withheld chip supplies and technical information from Digital Equipment and Intergraph after the two sued Intel for violating their patents. Additionally, an FTC action could charge Intel with withholding chips from computer manufacturers that also bought chips from Intel rivals.



To: Sonki who wrote (110)5/28/1998 9:58:00 PM
From: ANANT  Respond to of 395
 
Bus.wk article on E-mail. It is quite long if interested read.

OFFICE E-MAIL: IT CAN ZAP YOU--IN COURT
businessweek.com@@fyr8PGQAXrf8DAAA/premium/23/b3581089.htm



To: Sonki who wrote (110)6/2/1998 9:58:00 PM
From: ANANT  Respond to of 395
 
sonki & all : LU / MOT team up - WSJ article - June2,98

-----------------------------------------------
Motorola, Lucent Team Up
To Design New DSP Chips

Dow Jones Newswires

NEW YORK -- Lucent Technologies Inc. and Motorola Inc. Tuesday announced a research partnership to develop next-generation digital signal processor products, the specialized chips used to run wireless phones, modems and other audio and video devices.

The two will collaborate on designs but will sell the products separately. The companies will create a joint design center in Atlanta which is set to be open by the third quarter. They also will cross-license each other's latest DSP designs.

"We really believe that for each company to have access to all ideas has significant implications for the industry as a whole," said Lucent. The new designs are expected to be available in a year, said Motorola, which expects the DSP market to reach $15 billion by the year 2002.

DSPs, which analyze sound and light waves, are a fast-growing sector of the semiconductor industry, with sales this year expected to rise 30% to about $4 billion. The market is dominated by Texas Instruments Inc., with a 45% share, and Lucent with a 28% share. Analog Devices Inc. and Motorola are tied for third with 12% shares.

Analog in April unveiled a speedy DSP that it predicts will shake up the market and find wide application in digital speakers, smart airbags and speech-recognition systems. Last fall, Billions of Operations Per Second Inc., a company set up by former International Business Machines Corp. engineers, announced it had developed a design that could sharply advance the speed of DSPs. BOPS aims to license its technology to DSP manufacturers.

DSP chips produce "surround sound" in stereos and headphones, speed up computer hard drives and improve Internet communications. In coming years, the chip will have many other uses, such as reducing noise in vacuum cleaners or controlling power steering in cars. Though DSPs are much cheaper than personal-computer microprocessors, they have fatter profit margins than many chips.
-----------------------------------

In view of the importance of DSPs, it will be interesting to know the DSP component as % of sales of TXN, LU and MOT.

ANANT



To: Sonki who wrote (110)6/6/1998 6:06:00 AM
From: ANANT  Respond to of 395
 
sonki: TXN is trying to get rid of the DRAM business. DRM sales are 10% of TXN total sales. I still do not know what the rest sales of TXN are. I suspect DSP sales may dominate.

Please read the NYT article date June 6, 1998

June 6, 1998

Texas Instruments in Talks to Sell Chip Operations
By LAURA M. HOLSON

texas Instruments Inc., a leading producer of computer chips, is in talks to sell its memory-chip operations to Micron Technology Inc., people close to the talks said Friday.

While the discussions are preliminary and it is always possible they could fall apart, the sale would be a significant move for Texas Instruments, whose earnings have been hurt by overproduction and declining prices in the notoriously fickle market for dynamic random-access memory chips, or D-RAMs.

The deal would allow Micron Technology, one of the nation's leading chip makers, to buy much-needed market share to challenge foreign competitors.

It is not yet known what price Texas Instruments is seeking or how any deal would be structured. The company, based in Dallas, is involved in two joint ventures and has chip-making operations of its own. Analysts estimate revenue for the company's memory-chip business at $850 million for 1998.

Analysts have long pushed Texas Instruments to sell its D-RAM business. The price of D-RAM chips, which are commonly used in personal computers and other devices, has fallen to $3 each from more than $8 a year ago. The D-RAM business accounts for roughly 10 percent of the company's sales.

Texas Instruments has already taken some steps away from the business. In March it sold its 33 percent stake in a joint venture with Acer Inc., Taiwan's largest computer maker, after a nine-year alliance.

"It will help them to get out from under a loss that is killing their stock price and focus on other business," said James Barlage, a senior semiconductor analyst at Salomon Smith Barney.

A sale, he said, would allow Texas Instruments to focus instead on its digital signal processor business, a rapidly growing market. Digital signal processors are specialized chips used in cellular telephones, computer networking equipment, toys and cars.

Both Texas Instruments and Micron Technology declined to comment on whether they were in talks.

But Micron Technology, which is based in Boise, Idaho, has said lately that it wants to expand its operations.

Patrick Adams, portfolio manager of the Berger 100 mutual fund, met with a Micron Technology executive on Thursday in New York who told him the company was "looking to make an acquisition."

"It certainly makes sense for both sides to make the deal work," Adams said.

One obstacle that Micron Technology faces is financing, analysts said. The company does not have enough cash to acquire the business, Barlage said, and would most likely consider debt financing, possibly a convertible bond offering.

Shares of Texas Instruments closed at $50.8125 Friday, down 6.25 cents; Micron Technology closed at $24.0625, up 31.25 cents.

Analysts and industry watchers have speculated for nearly a month about whether the companies were in talks. Texas Instruments, which analysts say is also looking to acquire other properties, was the subject of market speculation on Thursday when analysts said it could be a possible buyer of Integrated Circuit Systems, based in Valley Forge, Pa. Integrated denied it was in talks with Texas Instruments.

----------------------------

Kind rgds

ANANT



To: Sonki who wrote (110)6/6/1998 11:54:00 AM
From: ANANT  Respond to of 395
 
sonki: Merger talk relating to tecom equipment cos LU, CSCO etc

this link is interesting. i learnt from this that lu is barred until sep 30 to make acquisitions under "pooling of interests" which has lot of advantages. after sep 30, lu can be aggressive in bidding up larger cos. recent tlab/cien merged co can be a good candidate for acquisition etc. and also asnd , bay etc.

Message 4750275

please read if u have time and interest.

Kind rgds

ANANT



To: Sonki who wrote (110)6/6/1998 6:22:00 PM
From: ANANT  Respond to of 395
 
Sonki: some interesting links from Intel thread - XEON & price cuts

Xeon, Intel price cuts due:
news.com

pfe thread --- new drugs

Message 4732475

ANANT



To: Sonki who wrote (110)6/6/1998 6:39:00 PM
From: ANANT  Respond to of 395
 
sonki: Investing in health - U must read from Barrons 6/8/98

I am sending 6 sections in separate posts.

June 8, 1998 <Picture: [Barron's Online]>
ÿ
As Baby Boomers charge into middle age, a lot of them are continuing to play sports as if they were still college kids. Result: a huge increase in trips to the emergency room by the over-40 crowd. Bicycling and skiing are the most dangerous. But beware the big three country-club sports.

Baby Boomers Enter The Danger Zone

Still skiing the bumps at age 44? Watch out! --- Why so many weekend warriors end up in the hospital

<Picture: thin rule>
By Jonathan R. Laing

Staying in shape has become an American obsession in the 1990s, with Baby Boomers well into their 40s and 50s playing basketball, lifting weights and racing down ski slopes. But this trend has one disturbing consequence: Ever-greater numbers of weekend warriors are ending up in the hospital. In 1996, for example, more than 43,000 skiers over 40 years of age were taken to emergency rooms for treatment, up twelvefold from 1986. As the nearby illustration shows, there were also large increases in emergency-room admissions for Baby Boomers who play basketball, lift weights and golf.

<Picture: [Cartoon]>

These injuries typically occur when people are trying to perform the way they did as teenagers -- or the way they see stars like Michael Jordan or Pete Sampras play on TV every week. All too often, such overly ambitious efforts result in torn muscles, blown knee joints and ruined rotator cuffs.

Even doctors aren't immune. Take Lee Newcomer, for example. As Chief Medical Officer for the HMO giant United HealthCare, the 46-year-old Newcomer has first-hand knowledge of the casualty reports from the fitness front. On top of that, he has been a fitness buff since high school, when he was twice Nebraska state cross-country champion and once state champion in the mile. Yet this didn't keep him from shearing his Achilles tendon in 1990 when he jumped to take a shot during a pickup basketball game. The tendon made a sickening pop sound, forever shattering his illusion of athletic invincibility.

''The accident was all my fault, of course, for failing to properly warm up and stretch,'' he ruefully recalls. ''I was on crutches for five months after the surgical repair, which meant that my partners at the Tulsa hospital where I then practiced had to do all my rounds. None of us was very happy about the situation.''

One of the most troubling findings on the injury front concerns women, who are now playing strenuous sports far later in life than they ever did before. Right now the world of sports medicine is buzzing about the epidemic in serious knee injuries suffered by female athletes playing high-impact sports like soccer, basketball and skiing. Growing numbers of these women have been suffering much-dreaded tears in the anterior cruciate ligament (ACL), the most important ligament controlling and stabilizing the knee and the most difficult to repair. It appears that women are three times more likely to sustain this injury than are the men who play these sports.

''We're not sure why this rash of knee injuries is occurring, but all I know is that women patients in recent years have surged to half of my sports practice,'' says Dr. Michael Dillingham, a prominent Bay Area orthopedic surgeon and team physician for the San Francisco 49ers.

None of the raft of doctors and other sports-medicine gurus Barron's consulted suggested that the risk of injury outweighed the benefits of engaging in exercise. Far from it. Typical was Dr. Herbert Haupt, a St. Louis orthopedic surgeon who has done extensive research on the aging athlete. As he points out, ''Exercise helps diminish the four most destructive problems of age -- hypertension, heart disease, arthritis and hearing loss.''

That sentiment is echoed by Dr. Thomas Upton, a Chicago cardiologist who, among other things, has been in charge of screening all the top National Basketball Association rookies for potential heart problems: ''Sure, it's not unusual for coronary problems to result in the death of a runner or two during, say, the New York or Boston Marathons or other major corporate distance races that involve large groups of runners. Unfortunately, a lot of folks don't train properly or take stress tests when contestants possess obvious risk factors like elevated cholesterol, elevated blood pressure, a family history of heart disease, diabetes and a history of smoking. Still, a program of strenuous exercise like running beats a sedentary lifestyle almost every time.''

Still, some caution is in order. Especially since research shows that human beings reach their physical peak at around 25 years of age. From then on, one's physical condition begins to decline, slowly at first, and then with gathering speed after age 50. Muscle mass diminishes. Ligaments, the body's basic suspension system for joints like the knee, ankle, hip and shoulder, lose their suppleness and flexibility. Physical endurance flags.

Wear and tear on the cartilage cushions of the joints accumulates, leading to aches and pains, reduced range of motion and ultimately, perhaps, potentially crippling arthritic inflammation of a joint. In addition, a slowing of the reflexes can betray the aging athlete by robbing him or her of the necessary quick reaction time to avoid a collision on the touch football gridiron or properly negotiate a tricky bump on the ski slopes.

Of course, adequate conditioning and stretching can retard this grim progression and help the recreational athlete avoid pulled muscles or more serious injuries. Sure, Gordie Howe played all-star caliber professional hockey into his 50s, as sports buffs invariably point out. And Nolan Ryan was still popping fast balls (and pain-killers) in the Major Leagues after age 40. But for most weekend warriors, the responsibilities of career and family begin to obtrude at almost precisely the point that physiological decline begins to set in.

The recreational athlete doesn't have the time to work out as much, and deconditioning, as the physical-therapy crowd calls the process, sets in. This is usually accompanied by a weight gain or, at least, some redistribution of body fat, which puts additional strain on muscles, bones and joints.

However, our discussions with exercise experts turned up a number of suggestions as to how desk-bound professionals and others can remain athletically active without major trauma to life or limb. Perhaps most controversial, they suggest that the over-the-hill gang think about giving up heavy-impact sports like touch football, baseball, rugby, hockey or basketball by the time they reach 35 or 40 years of age. Or at least ratchet down the action somewhat by either playing with folks one's own age or going at less than full tilt.

''A sport will generally tell you when it's time to quit. When you can't comfortably compete against younger players or you're sore for days after you play even though you did proper stretching, it's time to move on to another activity,'' says Dr. Elton Strauss, Chief of Orthopaedic Trauma and Reconstructive Surgery at New York's Mount Sinai School of Medicine.

<Picture: [Chart]>

Now 50, Strauss practices what he preaches. He gave up five-on-five basketball and flag football at 35. And he wishes he'd given up ice hockey at the same time. He still has two screws in his elbow from an ice hockey mishap suffered a year later. Yet Dr. Strauss is hardly a shrinking violet these days. He still kickboxes and plays tennis with his 22-year-old daughter. Nor does he necessarily insist that patients drop sports like skiing even after hip or knee replacement surgery. ''Life is function, and function is life,'' he observes in Zen-like fashion. ''People have to do what they want to do.''

Up to a point, that is. Dr. Russell Warren, a Manhattan orthopedic surgeon and team physician for the New York Giants, has to look no further than his examining room to see the toll that Baby Boomers' machismo is exacting. Warren himself had to give up rugby a decade ago when he was 47 because of stiffness that persisted even days after a match.

What activities exact the biggest toll and at what age are athletes most vulnerable? To answer these critical questions, Barron's was able to unearth some obscure government statistics on sports injuries compiled by, of all agencies, the U.S. Consumer Product Safety Commission. It seems almost any injury under the commission's definition involves a product, whether it be running shoes, cleats, shoulder pads, weight-lifting stations or skis. Thus, the agency systematically surveys a representative sampling of the America's 5,000 emergency rooms to estimate the number and the nature of all sports injuries each year. At Barron's request, the agency's National Injury Information Clearinghouse was also kind enough to take the results for 1986 and 1996 (the last year for which figures have been completely compiled) and slice and dice the injury totals by sport and age group. As a result, readers can look up their favorite athletic pursuits and see where the greatest number of injuries occur for the over-40 crowd.

Perhaps the clearest indication of Baby Boomers' refusal to go quietly into middle age is the dramatic increase in emergency-room admissions for sports injuries. Between 1986 and 1996, such admissions for those over 40 increased by a little over 60%, from 71,749 to an astounding 180,632.

One of the most dangerous activities, oddly enough, turned out to be bicycling. Whether for broken bones, concussions or serious abrasions, 47,143 bicyclists over 40 years old were admitted to emergency rooms in 1996, more than double the 20,149 that were admitted a decade earlier.

Almost as injury producing was skiing, with 43,491 admissions among the over-40 group. And the increase here has been astronomic, as suggested by the fact that in 1986 only 3,562 skiers over 40 were admitted to emergency rooms. From the look of it, a lot of Baby Boomers learned to ski during the 1960s and they don't want to give it up. Perhaps the draw is the natural beauty of so many ski sites or the glamour of the apres-ski scene. In addition, skiing requires a certain affluence that's more likely in an older crowd.

It's important to note that the older bunch has vastly more potential for serious injuries to areas like the back, knee and lower leg. So the rule is: Unless you're in terrific shape, if you want to keep skiing into your 40s and 50s, be prudent.

<Picture: [Grover]>
How does Michael Jordan avoid injury? Trainer Tim George makes him stretch for an hour or more before and after every practice.

Most guys have the common sense to quit playing football by their mid-20s. But there are plenty of exceptions, particularly when you include all the touch-football and flag-football players that do battle every autumn. This contingent, often flabby and out of shape, helps explain why more than 21,000 football players over age 30 were admitted to emergency rooms in 1996, up from about 13,000 a decade earlier.

Even when it comes to easily manageable activities like weight-lifting and using exercise equipment, America's aging Boomers seem to be pressing too hard. About 1,150 weightlifters in their 50s were admitted to emergency rooms in 1996, up from about 575 back in 1986. Admissions after use of other types of exercise equipment jumped to 2,415 in 1996, up more than fourfold from a decade earlier. Staying in shape is great, but remember, muscle tears and hernias are a heavy price to pay to look as ''buff'' and ''ripped'' as those who are 20-something.

Although the roller-skating category shows a rise in injuries among people over 40, this is almost surely due to heavier participation, particularly in rollerblading. Notably, there has been a steep decline in emergency-room admissions among younger skaters over the past decade, probably owing to the increased use of safety gear, such as knee pads, elbow guards and wrist protectors. Among 15- to 19-year-olds, for example, there were 5,651 emergency-room admissions in 1996, down from 10,389 admissions in 1986.

Don't think softball is any respecter of age. That staple of adult leagues, company outings and family picnics inflicted more injuries (22,131) on 30- to 34-year-olds in 1996 than it did on players in their early 20s (19,851). And the injuries of those over 30 tended to be more severe. They sustained 30% more traumas to critical areas like the knee and shoulder. Lest one think softball is a pantywaist pursuit compared to hardball, note that softball injuries for athletes aged 25 to 50 were nearly twice the total of 38,653 suffered by baseball players of the same age span.

As athletes move into their 40s and 50s, many migrate to lower-impact sports like golf or swimming. It's easy to see why. With golf, tennis or swimming, an athlete can stay fit, work the cardiovascular system and burn off a few calories, all the while minimizing the chance of injury. The statistics bear this out. Emergency-room admissions for golf in 1996 totaled 19,989; tennis, 16,211, and swimming, 12,107. These figures are dwarfed by the comparable injury totals for basketball, 451,903; football, 196,682, and skiing, 88,791.

Yet the big three sports of the country club set pose their own hazards. Golfers between the ages of 45 and 54 suffer twice the number of injuries as those in their 20s do, with shoulder, lower-back and lower-leg problems accounting for the bulk of the difference. Tennis players in their early 40s, meanwhile, can count on elbow, wrist, back and foot injuries to crop up. As for swimmers, injuries seem to crest in the late 30s as shoulder and lower-back problems develop. Muscle ''impingement'' from rotator-cuff problems in the shoulder force many veteran swimmers to abandon the crawl or butterfly for the breast and side strokes.

Of course, no amount of denial or even conditioning can change the fact that physiologically it's downhill after age 25 for the broad range of athletes. Sure, some can compete well into their 30s or even 40s. But averages are averages.

Dr. Haupt of St. Louis, who has made a specialty of studying the aging athlete, describes the process with clinical detachment. First, of course, muscle mass or strength begins to decline. Initially this loss is barely perceptible, at about 4% per decade until age 50 when it accelerates to about 10% per decade. By 60, the average male has lost roughly a third of his muscle mass if he fails to stay in reasonable shape through regular exercise.

This fact affects more than physical performance. Muscles are, after all, what give us strength and speed, powering the body like a motor powers a car. Muscle and tendon systems serve as well as secondary stabilizers to joints like the all-important knee, protecting not only the joints but their primary stabilizers, the ligaments. Late in life, the loss of muscle strength often leads to the falls and broken bones that bedevil the aged.

Meanwhile, according to Haupt, the body's cells stop functioning with peak efficiency as time goes by. Athletes' endurance suffers as the cells no longer process oxygen as effectively. The tired athlete, of course, becomes more inattentive and, therefore, prone to injury. That's why, as any ski-patrol member will tell you, the bulk of all ski accidents occur in late afternoon.

Healing rates also decline with age. At least that's what a number of animal studies show. The young animal can fully heal from muscle and other soft-tissue injuries in 30 days, while older animals are only about two-thirds recovered.

Lastly, joints progressively lose their flexibility with aging. This is in large part because collagen, the main building block of soft tissues like muscle, tendons and ligaments, becomes more fibrous and therefore less elastic. As a result, these stabilizers afford less protection to the joint. They are also susceptible to pulls and tears. At the same time, the built-in shock-absorbers of the joints -- cartilages -- tend to erode, flake and compress with wear and tear.

As if this weren't depressing enough, the aging athlete can be betrayed by what's commonly known as ''muscle memory,'' according to Dr. James Bradley, a Pittsburgh orthopedist who is also the physician for the Steelers football team. As he explains it, the neural connections to the muscles, forged over years of practicing, say, a spin move in football or a twisting move to the hoop in basketball, can fire in their normal sequential order only to find that while the spirit may be willing, the flesh isn't. ''If you don't use the key muscles in a sport regularly, you lose them and suffer injuries in the process,'' Bradley observes. ''It's not just athletes who sometimes live in the past. So do their nervous systems.''

Yuppie narcissism reigns these days, with American men and women pumping iron with maniacal zeal. Little wonder that one of the fastest-growing niches in magazine publishing is the men's magazine, replete with male beefcake photos on the cover and articles with headlines like ''Bigger Biceps in Two Weeks.'' Indeed, the legacy of today's generation of insecure American males may be the transformation of showy muscle groups like the biceps, ''abs,'' ''pecs,'' ''lats'' and ''quads'' into objects of religious veneration.

America's tendency to beef up is certainly evident in the National Basketball Association. The league players have been transformed over the past 10 years from a bunch of angular giants into a crew of bulked-up physical specimens. Today the power game, featuring behemoths grappling for position under the hoop, has supplanted the run-and-gun style popularized by the Los Angeles Lakers of the 'Eighties.

No player epitomizes this transition more clearly than Michael Jordan, now 35. From a skinny rookie in 1984, Jordan has become a demigod, whose sculpted physique is an object of both conscious and subliminal identification on the part of millions of Americans. Nobody in professional athletics works out harder, according to Tim Grover, Jordan's private strength coach and trainer, who has worked with the superstar exclusively since 1989. Jordan trains under Grover for more than an hour before and nearly an hour after every practice, either in a gym in his home on Chicago's North Shore or in private health clubs in cities where the Bulls are playing road games. Jordan is all business in the gym, engaging in little small talk with his aging workout mates, Scottie Pippen and Ron Harper.

In addition to the usual upper-body strength work, Grover has Jordan concentrate on areas of the body that are vulnerable to injury in basketball, including the fingers, toes, ankles, wrists and knees. To increase the strength and flexibility of arms and tendons, Grover has Jordan do the martial arts exercise of kneading wet rice in buckets with his hands. The superstar also scrunches wet towels on the floor to strengthen his toes. Ankles are built up and made flexible by walking on two-by-fours and purposely rolling ankles in and out. The latter exercise allowed Jordan to miraculously recover from a bad ankle sprain suffered in the playoffs several years back; he was able to start in the following game, just 48 hours after the mishap.

Much of Jordan's routine remains shrouded in mystery. Grover and Jordan have no desire to give away any secrets. But the point the recreational athlete should remember is simple, according to Grover: ''If you try to be like Mike, remember that, like most top athletes, he works out six hours a day, eleven months a year.''

Despite the heightened risk of injury for aging weekend warriors, the allure of team sports endures. The motivation is complex, going well beyond any attempt to deny the passage of years and remain suspended in eternal youth. Joe Kita, a writer at Men's Health magazine, wrote a wonderful article in the magazine about how, at age 38, he returned to the Pennsylvania high school where he'd been cut from the basketball team some 20 years before and managed to make the varsity this time around. Of course, he wasn't eligible to play in any league games. But at least he had the satisfaction of knowing from the head coach, some 12 years his junior, that he'd earned a spot on the ''press team,'' used for defensive stands during key moments.

Kita also found that, as a result of weeks of ferocious preparation, he arrived for tryouts in far better condition than his slack-jawed teenage rivals. Of course, before long, he was starting to wear down. He was afflicted with soreness and aches and pains, while the kids seemed to recover from the previous day with just a night's rest.

But no matter. He'd made his point. He's righted a grievous wrong that had haunted him through adulthood, and a whole lot more.

He found he got goosebumps at the end of every practice when the team met in a tight circle, linked hands and reverently intoned the word ''team'' before heading to the locker room. All for one and one for all. After years of anonymity in the workplace, those moments meant far more to Kita than any kid could realize. The bonding. The solidarity. Perhaps, he found himself thinking, all weddings, family gatherings and business meetings should end the same way. It sure beat the ersatz identification adult Americans have with their favorite sports teams.

In team sports, a coach is a far more positive force than any boss in the workplace. A true coach ''wants you to improve and succeed, as much for yourself as for the team. He's the objective taskmaster your father can never be, the field psychologist who understands what drives you,'' Kita wrote.

Finally, Kita savored those magic moments during the long tryout when he felt like a 17-year-old rather than the balding, greying adult he'd become. ''You know the soul never ages -- at least until you look in the mirror,'' he observed.

As noted above, women these days are, with worrisome frequency, suffering ghastly tears to the anterior cruciate ligaments of their knees. Theories abound as to why. Some experts wonder whether women athletes condition themselves as thoroughly as men do. Alternatively, women may not have as much exposure to sports early in life, and therefore may not develop the same neural hardwiring and coordination. Or perhaps female knees are more subject to stress because of subtle alignment differences caused by women's wider pelvises. Some doctors have speculated that the problem is caused by the shape of the female knee or hormonal shifts during the monthly menstrual cycle weakening the ligaments. Right now, no one really knows.

The good news is that ACL tears are no longer the career-ending injuries they once were. Dr. Mike Dillingham of the 49ers had star receiver Jerry Rice back on the field just three and a half months after a surgery in which Dillingham created a new ACL by using part of Rice's kneecap tendon as a substitute. ''Rice was just transcendent for the first half of his return game,'' Dillingham recalls. ''Unfortunately, he then fractured his patella as a result of a freak play. Yet he'll be back better than ever next year.''

Other medical breakthroughs are brightening the prospects that all weekend warriors will be better able to cope with their inevitable injuries. Arthroscopic surgical techniques, which are minimally invasive, have improved results and reduced recovery times. Cartilage that once was routinely removed can now be surgically repaired, and advances in cell technology promise to permit the reproduction of cartilage from a patient's own cells. The endemic ''loose shoulder'' problem of aging athletes no longer requires painful surgery followed by months of rehab. Now surgeons are starting to use arthroscopically delivered heat probes to the capsule of tendons inside the rotator cuff to shrink them, much like cooking bacon, thereby restoring stability to the shoulder.

The list of new procedures goes on and on, offering hope for a quicker recovery and an old age freer of the crippling pain of arthritic joints. Still, the recreational athlete must never forget: It's better to quit a sport before you push it too hard, not when you're on the way to the hospital.



To: Sonki who wrote (110)6/6/1998 6:48:00 PM
From: ANANT  Respond to of 395
 
Section 2 of article on health

June 8, 1998 <Picture: [Barron's Online]>
ÿ

Peak Condition

Training with top executives -- Does success on the playing field breed success in the board room?

<Picture: thin rule>
By Jaye Scholl

Body Mass Index

It's a glorious spring day in Newport Beach, California. The marina is crowded with sleek sailboats, their polished white hulls gleaming in the sunshine. Bicyclists and runners, looking just as lean and taut as the racing yachts, move noiselessly along the streets.

The scene looks like a videotaped prescription for good health. There's no humidity, no sweat and no bugs. There's no smog, no snow, not much rain, no hassles -- nothing, in short, to interfere with keeping yourself in great physical condition.

<Picture: [Mcneally]>
Executive athlete Sun Microsystems CEP Scott McNealy

Even if you put in long hours up the street from here, overseeing billions of dollars of bonds for Pacific Investment Management, chances are excellent that you, too, could be transformed into one of those lithe, spandex-clad creatures. Pimco, as it's known, ranks as one of the world's leading money-management companies, with a terrific long-term record and more than $200 billion in client money in its portfolios. Pimco, as it happens, is also one of the most health-conscious companies around. The manifestations of the corporate culture are evident in big and little ways. Pimco subsidizes the membership costs for employees who exercise at the local health club, for instance. And last year, the investment-management company changed its travel policy to allow employees to apply their meal allowances to health-club charges.

Then there's the water. Once a month, the Arrowhead Mountain Spring Water truck delivers 5,000 bottles of its product to slake the thirst of Pimco employees. Tour the offices of Pimco; you won't see any obvious couch potatoes. Instead, you'll be introduced to three triathlon competitors and told of the numerous employees that swim in competitions for ''seniors,'' meaning people over 50.

''Working out at lunch time is a completely acceptable activity here,'' says one hard-bodied employee.

Actually, it's more than acceptable. If you want to win the respect of Pimco founder and managing director Bill Gross, ditch the potato chips and start carrying a gym bag. The 54-year-old Gross, known for his ability to divine the direction of interest rates, has been called ''The Peter Lynch of bonds.'' He's also a fitness advocate -- for himself and everyone else.

<Picture: [Brown]>
Executive athlete cosmetics entrepreneur Bobbi Brown

''The ability of someone to stick with a regimen of exercise is a test of willpower,'' says the soft-spoken Gross. ''It's a statement that you can stick to an objective and get the job done.''

Before Gross' knees gave out, he ran marathons. He was so obsessive -- his word -- that he once ran from San Francisco's Golden Gate Bridge to Carmel-by-the-Sea, the equivalent of six marathons, in six days. The damage to his kidneys landed him in the hospital.

Now his regime revolves around a lunchtime workout at the health club and a Wednesday night session at his Laguna Beach home with a yoga trainer.

''I've always thought of exercise as an investment in my life,'' continues Gross. ''My body should be able to endure the long-term race and be around for the long haul.''

Gross is expressing a tenet well-known to health economists, which holds that people who expect to become successful take steps to stay healthy.

''People are more likely to make an investment in health depending on the payoff to them,'' says Sherry Glede, who teaches economics at Columbia University. Staying healthy, in other words, protects a major asset, your projected stream of income.

David Pottruck, president and co-CEO of Charles Schwab in San Francisco, credits his physical stamina with helping him climb the corporate ladder. ''I worked longer hours because I was motivated to do so, but also because I was physically able to,'' comments Pottruck.

At the University of Pennsylvania, Pottruck was the captain of the varsity wrestling team and was also voted Most Valuable Player in 1970 when he was a linebacker for the varsity football team. He retired from wrestling after competing in the 9th World Maccabean Games in Israel, but gave up exercising for 10 years while he lived in New York. Then he moved to San Francisco in 1984.

''I saw that there was a major commitment to a healthy lifestyle here,'' recalls Pottruck. He began leaving home for work at 5 a.m. to get to the gym by 6. These days, on the cusp of 50, Pottruck works on cardiovascular conditioning four days a week -- stationary bike, StairMaster, treadmill -- and tacks on an hour of weight lifting three times a week. On weekends, he tries to walk the five-mile golf course.

<Picture: [Weisel]>
Executive athlete Montgomery Securities founder Tom Weisel

Is metabolism destiny? Let's just say that you don't come across too many fat CEOs. But as with Pottruck, the drive to be physically fit often exists long before a person achieves professional success.

Thomas Weisel, for instance, was a terrific athlete before founding Montgomery Securities, the San Francisco brokerage firm that merged with NationsBank last year. In the 1950s, Weisel was a five-time national speed-skating champion. And he has maintained his intense involvement in sports ever since, in part by participating in cycling and skiing events for ''masters,'' in which men and women over 40 compete in various age categories. In fact, in 1982, Weisel won a bronze medal in a masters national skiing competition, and he's been the worldwide masters cycling champion three times. In 1992, Weisel was recognized as Masters Athlete of the Year by the U.S. Cycling Federation.

Most people know that Scott McNealy, the ferociously competitive founder and CEO of Sun Microsystems, is an avid golfer who captained the Harvard University golf team. Less well-known is the fact that McNealy stays in shape these days by playing ice hockey before going to work.

Julian Robertson, who runs hedge funds at Tiger Management in New York, likes to hike up mountains in the West with his friend Barton Biggs, the crack investment strategist at Morgan Stanley Dean Witter. Last summer, they were part of a group that climbed Mount Whitney in the Sierra Nevadas, elevation 14,500 feet. ''It should have taken us two or three days, but Barton made us do it in 25 hours,'' quips Robertson.

Bobbi Brown describes herself as a fitness fanatic when she isn't in her present condition, which is eight months pregnant with her third child. Brown developed a cosmetics line with a devoted following among suburban moms like herself, and then she sold the company to Estee Lauder in 1995 for an undisclosed amount. She remains president.

<Picture: [Group]>
Climbing Mount Whitney was a high for strategist Barton Biggs (kneeling) and hedge fund manager Julian Robertson (third from right).

''Normally, I jog three miles three to four times a week,'' she says. ''At the moment, I'm lifting weights and using the treadmill for 45 minutes every day beginning at 6:45 a.m."

Brown also pays attention to diet. She eats more protein than carbohydrates and has a bias for organic and natural foods. She drinks only an occasional glass of wine.

Says she, ''I absolutely believe that you think more clearly when you take care of yourself.''

The success of the executives in this story certainly seems to bear that out.

------------------------------------------------------------------------

We all have our own goals for physical fitness, from maintaining the same dress size throughout adult life to running marathons. But one that has emerged as the standard measure of weight is the body mass index, or BMI.

Last year, for the first time, overweight people outnumbered normal-size people in the United States, according to data gathered by the National Center for Health Statistics in Hyattsville, Maryland.

The reasons are simple. People eat too much and exercise too little. The federal government recommends that a person's BMI should not exceed 25. If you want to fit into your college graduation suit or that wedding dress, you'll probably need to achieve a BMI of under 20. A woman five feet, four inches tall and weighing 145 pounds has a BMI of 25, for example.

Here's how to figure your BMI:
1. First, multiply your weight in pounds by .45 to put it in kilograms.
2. Convert your height to inches.
3. Multiply inches by .0254 to put them in meters.
4. Multiply the number of meters by itself.
5. Divide the kilograms (No. 1) by the squared meters (No. 4).
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To: Sonki who wrote (110)6/6/1998 6:51:00 PM
From: ANANT  Respond to of 395
 
Section 3 of article - Barrons

Americans shell out an astounding $4 billion a year on exercise equipment for their homes, a lot of it junk. You can spend $1,000 for a bargain-basement treadmill and a few free weights, or you can drop $10,000 for a top-of-the-line weight-training system and an array of rowing, skiing, bicycling and running machines. Herewith, some guidelines. As for the stuff you see advertised on TV, ignore it, especially that perky SlamMan.

ÿ

Magic Machines

A Gym In Every Home? -- Americans aren't getting any thinner, but they are buying a ton of exercise gear

<Picture: thin rule>
By William G. Flanagan

Take Your Pick

If Herbert Hoover were alive today, he would have to revise his party's vision of a bountiful America: ''Two chickens in every pot, two cars in every garage, and a workout room in every home.'' For some odd reason, Americans these days just can't keep themselves from buying exercise equipment. A lot of these gizmos end up gathering dust in the spare room, of course, but that doesn't stop the spending spree. In all, more than 50 million Americans have purchased gym equipment at some point in their lives, with each of them spending an average of $473. Last year alone, the total outlay on such products was an astounding $4 billion.

As with any national mania, there are various degrees of insanity involved. At the fairly subdued end of the spectrum, you can set yourself up with a home gym by spending $1,000 for a bargain-basement treadmill and some free weights. At the other extreme, you can lay out $3,600 for a Vectra On-Line 1500 weight-training system, and then throw in $2,000-plus for an assortment of items like stationary bikes, elliptical trainers and cross-country skiing contraptions. If you want to add a mirrored exercise room to your house, it's easy to double the tab.

<Picture: [Cartoon]>

The problem, of course, is getting yourself to use all this stuff on a regular basis. Of all the folks who have ever bought exercise equipment, more than a third don't use it anymore, according to the Fitness Products Council. And one survey showed that nearly 90% of buyers have no intention of purchasing any more workout gear.

But don't believe it. Just wait till these folks see the new exercise machine of the moment on a TV infomercial. Just wait till they see how easily Christie Brinkley and Chuck Norris tighten up their abs, working out just minutes a day.

''The industry is driven by infomercials,'' says Charles Kuntzleman, associate professor of kinesiology at the University of Michigan. ''Yet a lot of this stuff is poor quality, or hard to use, and it winds up being a clothes rack.''

Maybe so. But the industry clearly isn't worried about running out of couch potatoes. Sales of home-gym equipment are expected to grow an average of 7.4% for the next five years.

What is driving the market besides infomercials? According to the marketing experts at Frost & Sullivan, there are several major influences:

* An aging population. Retirees and graying Boomers are smarter about health, and they are living longer to worry more about it. Over the past five years, sales of exercise equipment to people between the ages of 45 and 64 rose 53%.

* More disposable income in today's heady economy.

* Growth of fitness-related magazines and media coverage.

* Better education about the benefits of regular exercise.

Today one out of every two Americans is overweight, and one in three is obese, meaning 20% or more above healthy body weight. Makers of home gym equipment know this, and they know how to play on Americans' guilt about their bulging waistlines. The key is to make it look like fun to work out regularly.

''It's an entrepreneur's market,'' says Kuntzleman. ''A smart guy who works out a lot will get an idea in the gym, and pretty soon it's on television. It's not very scientific.''

The current flavor of the month is the SlamMan, a kind of space-age Schmoo. It's a human-shaped punching bag complete with computer, flashing lights, an instructional video, a pair of professional 12 oz. boxing gloves and a low-fat meal plan.

Sugar Ray Leonard provides the inspirational testimonial: ''I like SlamMan and I think you will too.''

Cost: $300, plus $40 for shipping and handling. Monthly payments can be easily arranged.

But SlamMan will probably do more for your stress level than for your waistline. If you're really trying to stay in shape, better to stick with a traditional exercise machine. Basically, there are two types: aerobic, to exercise the cardiovascular system, and anaerobic, for building and toning muscles.

Traditional aerobic machines include treadmills, stair climbers, stationary cycles, rowing machines, ski exercisers and, more recently, elliptical trainers, which minimize the pounding on your joints by letting you run or walk without ever picking your feet up off the machine's two huge pedals.

Cardiovascular workouts aren't going to do wonders for your butt and abs, but they will lower your risk of high blood pressure, diabetes, heart disease and cancer, as well as slow the decline in muscle strength.

Which aerobic machine is most effective? According to one study, conducted at the Medical College of Wisconsin, ''The treadmill is the optimal indoor exercise machine for enhancing energy expenditure when perceived exertion is used to establish exercise intensity.''

Translation: If you work out consistently on a treadmill, it will give you the most rewards. The stair-stepper also gets high marks.

But other studies find little difference in results from these machines. And judged by oxygen intake, the machines produce about the same aerobic benefits as a walking and jogging program, according to a study conducted at East Carolina University.

It all boils down to which machine or exercise program you will stick with, meaning which one you least dislike.

For strengthening and toning muscles -- anaerobic exercise -- free weights are king. The number of people lifting weights has increased 75% since 1987. Rare today is the athlete who doesn't lift. About 35% of all home-gym equipment sales are free weights.

Still, weights are practically indestructible and relatively cheap, selling for as little as 35 cents a pound. So the industry has devised all kinds of expensive, single-station and multi-station strength machines as alternatives. Sales of these anaerobic machines, mainly weight-training machines, should top $1 billion this year. Such sales are growing 8.3% a year, slightly faster than aerobic gear, with annual sales growth of about 7%.

One reason sales of home gym equipment are brisk is that the machines promise to cut flab. ''Exercise equipment historically has been sold for its general fitness and aerobic benefits, and many exercise devices are excellent for that purpose,'' says Jodie Bernstein, director of the Federal Trade Commission's Bureau of Consumer Protection. ''Recently, however, the commission has investigated many exercise equipment companies for pushing the purported weight-loss benefits. Some manufacturers have gone overboard in touting the weight-loss benefits of their products.''

Last year, the FTC cracked down on four manufacturers for making exaggerated claims, which it calls Pump Fiction. Abflex, maker of an abdominal exerciser, had claimed you could get ''a flat, sexy stomach in just three minutes a day,'' and that ''if you don't lose five inches and 10 pounds within 30 days, you can return Abflex for a full refund.''

Life Fitness and Icon Health & Fitness, the largest manufacturer in the business, were also cited for claiming that users of treadmills or exercycles could burn 1,000 calories per hour in ordinary use.

Nice try. A healthy male walking at four miles an hour will typically burn 330 calories an hour.

Right now the FTC is burning plenty of calories itself staying on top of the hope-over-experience trade. In 1996 the commission went after another big manufacturer, NordicTrack, for making spurious weight-loss claims. Experts insist exercise alone will not result in dramatic weight loss. Diet is key.

So, what is the best equipment to have in your own home gym? Kuntzleman, with the assistance of 50 exercise specialists, recently evaluated 130 pieces of indoor exercise equipment for Consumers Digest.

Here are some tips:

1.A decent home gym needs at least two components: an aerobic machine like a bike, cross-country skier or treadmill; plus a set of free weights. The set should include about 200 pounds of plates ranging from one to 25 pounds, two bars for dumbbells and one for a barbell. If you can afford it, add a multi-station exercise machine. 2.Buy from a specialty store. They have the best products and most knowledgeable staff, and they will provide service -- including delivery, assembly and repairs. Buy the best you can afford so you can enjoy using it and it doesn't break down. 3.Think twice about buying machines that require you to change cables or reconfigure them to do different exercises. 4.Treadmills are the warhorses of home gyms, accounting for over $1 billion in annual sales. Make sure yours is motorized with at least 1.5 HP and designed for continuous duty. Treads should be at least 50 inches wide, and you should be able to raise it to simulate hills. If you plan to jog, rather than walk, figure on spending $2,000 or more on a solid machine. The machines in the under $1,000 range should suffice if you plan just to walk. 5.Stationary bikes should be sturdy, too. Avoid the type with caliper brakes, which slow the wheel by pressing the rim. They wear out too quickly. Bikes range from $300 to $2,000. Some top bikes have magnetic resistance, which is quiet and smooth. 6.Stair-steppers, especially popular with younger exercisers, can be a bit tricky. You should decide whether you want a stepper, which exercises only the lower body, or a climber, which exercises the upper and lower body. You also have to decide whether you want pedals that move in tandem or independently. Test the machines for at least 15 minutes for stability, smoothness and comfort. 7.The best rowing machines, selling for about $700, use a fanlike flywheel attached to a cable or belt. 8.Cross-country skiing machines offer good fitness value. They are affordable, starting at $400, and can cost as much as $8,000, and also require you to exercise both the lower and upper body. 9.Check the electronics of any machine to see that it is made in the USA. Much equipment is made abroad, which is fine, but you don't want foreign-made electronics. 10.Multi-station exercise machines can take up a lot of room, and some need seven feet of overhead clearance. There are two types: machines with cables and stacks of weights, which run $700 to $2,200, and machines that depend on resistance from bungee cords, springs or pneumatic or hydraulic cylinders, which cost $300 to $2,000. Though more expensive, the weight machines are generally sturdier than the resistance machines.

What is the most popular, effective exercise of all? Walking. Seventeen million Americans now get their exercise this way, almost double the number of joggers. Users of strength-training machines, including weights, number 11.5 million.

How fast should you walk? Mark Fenton, author of The 90-Day Fitness Walking Program (Perigree, $10) notes that you can achieve good fitness at 120-130 steps a minute, and an excellent cardiovascular workout at 140-150 steps. That's about five miles an hour.

Experts recommend at least 30 minutes a day of moderate exercise, such as a brisk walk. But only 20% of Americans manage to do even that. After all, it's a lot easier to write out a check for a brand new SlamMan and then let it collect cobwebs.

William G. Flanagan is a senior editor at Microsoft's Moneyinsider.com.
----------------------



To: Sonki who wrote (110)6/6/1998 6:55:00 PM
From: ANANT  Respond to of 395
 
Section 4 - of article

LAUREN R. RUBLIN
Wall Street probably has more Type A personalities than any other spot on earth, so it should come as no surprise that it has its own cardiac ward, too. Yes, if you suffer chest pains in lower Manhattan, chances are you're headed for NYU Downtown Hospital. Lots of traders make that humbling trip. Here's what they see.
ÿ
June 8, 1998 <Picture: [Barron's Online]>
ÿ

"Time is Muscle"

Wall Street's Heart-Attack Ward -- When traders keel over, they usually get whisked to NYU Downtown Hospital

<Picture: thin rule>
By Lauren R. Rublin

Toiling in the trenches of capitalism might be great for your wallet, but it can be murderous on your heart. Nearly everyone on Wall Street knows a horror story about someone stricken by a heart attack at work, and that seems sadly fitting in a neighborhood packed with tens of thousands of aggressive bankers, brokers and traders who push themselves to the limit for the sake of an extra eighth or sixteenth.

Just as Wall Street over the years has gained a reputation as New York's heart-attack alley, NYU Downtown Hospital has become known as the financial district's heart-attack ward. Wedged into a quiet pocket of lower Manhattan, the hospital's primary territory includes Chinatown and the Lower East Side, but the vast majority of its heart-attack patients come from Wall Street.

<Picture: [Hospital]>
Only a five-minute ride from New York's financial district, NYU Downtown Hospital has become known as Wall Street's heart-attack ward. Funded in part by generous donations from some of the city's major financial institutions.

''I tell people, 'You can have the fanciest doctor up at New York Hospital or Mount Sinai or Columbia-Presbyterian or New York University, but if you have a heart attack on Wall Street, you're coming to NYU Downtown','' says Dr. Ira Schulman, the hospital's director of cardiology.

Like every cardiologist, Schulman understands that when a heart attack strikes, time is of the essence. The longer a patient's heart remains in acute distress, the greater the damage to the heart muscle. As cardiologists put it, ''Time is muscle.''

<Picture: [Ambulance]>
Special emergence vans with EKG machines and defibrillators.

While an ambulance could take as long as 30 minutes to travel from Wall Street to Manhattan's uptown hospitals, the trip to NYU Downtown takes less than five minutes. Moreover, in recent years, the hospital's streamlined emergency-room procedures have greatly reduced the time it takes to treat patients with newer clot-busting drugs.

NYU Downtown's importance to Wall Street's health is not lost on New York's financial institutions. Indeed, the hospital has received generous donations from the New York Stock Exchange, the American Stock Exchange, J.P. Morgan, Merrill Lynch and Prudential Securities, among others. In many ways, the union between Wall Street and NYU Downtown is an expedient partnership. The hospital, like most, requires a steady source of outside funding, while the odds-making pros on Wall Street want to make sure that the hospital's cardiac facilities are state-of-the-art. It's like taking out an insurance policy on superior care.

NYU Downtown doesn't shoulder the burden for Wall Street's medical care alone. The hospital is but the most visible manifestation of an elaborate safety net the Street has constructed to safeguard the folks manning the front lines of global finance. Most big banks, brokerage firms and exchanges have on-site nurses and doctors, as well as long-term contracts with private ambulance outfits. And many have begun to install defibrillators, particularly the newer, lightweight automatic external defibrillators, made by Hewlett-Packard's Heartstream subsidiary and Physio-Control International. These new machines take the guesswork out of electrically shocking patients who are in cardiac arrest: When the defibrillator pads are placed on a patient's chest, they automatically assess the cardiac damage and deliver the appropriate voltage.

<Picture: [Schulman]>
Dr. Ira Schulman

In some Wall Street firms, defibrillators already have saved lives. Dr. Theodore Kowalski, corporate medical director at Salomon Smith Barney, recalls the case of a 42-year-old man who suddenly dropped off a treadmill in Smith Barney's fitness center and was technically dead. The fitness staff began cardiopulmonary resuscitation, an ambulance was called and the firm's medical staff, which occupies the office across the hall from the fitness center, rushed in and set up a defibrillator. ''The victim was defibrillated and came back,'' Kowalski says. ''We got the whole thing done within a three- to four-minute window. It was amazing.''

The New York Stock Exchange, which bristles about any implied link between trading and heart attacks, wouldn't comment specifically about the installation of a defibrillator on its trading floor. The Amex has installed two devices, and the New York Mercantile Exchange, now ensconced in its new headquarters in Manhattan's Battery Park City, has placed defibrillators on the building's two trading floors.

Many Wall Street firms also try to protect against heart problems by conducting frequent blood-pressure and cholesterol tests for employees, as well as classes in CPR, nutrition, smoking cessation and other heart-related topics. The message seems to be getting through, although you wouldn't know it from the brigades of smokers clustered outside most downtown office buildings.

''I don't have hard data, but my general sense is that there are fewer heart attacks in the financial district today than when I began practicing in the mid-1980s,'' says Dr. William Cole, director of an NYU Downtown community outreach program called Downtown HeartSavers. ''Presumably, the decline is partly related to changes in medication and treatment of heart disease, but it stems mostly from changes in lifestyle. In general, people are smoking less, exercising more and eating better, although there is plenty of room for improvement.''

Many heart attacks technically aren't heart attacks at all, he explains, but instances of cardiac arrest commonly brought on by ventricular fibrillation. The heart's electrical impulses, in this case, suddenly go haywire, compromising the muscle's ability to beat regularly and pump a steady flow of blood. ''If the victim doesn't get CPR and defibrillation within the first five minutes, the ballgame almost always is over,'' Cole says. Defibrillators, which the American Heart Association hopes to make as ubiquitous as fire extinguishers, supply a powerful electrical jolt that interrupts the organ's erratic rhythm and resets it normally.

Myocardial infarction, the medical term for a heart attack, occurs when blood vessels feeding the heart become blocked by clots that form on coronary plaque. These heart attacks can masquerade first as heartburn or indigestion. In addition, pressure in the chest might be accompanied by shortness of breath, dizziness and cold sweats, as well as pain that radiates to the left shoulder, arm, neck or jaw, which is made worse by activity, but not by deep breathing.

For Michael Riley, head of New York operations at the options-trading firm Letco, trouble came in the form of a heavy, aching feeling in the back and shoulders, accompanied by ''a sense of impending doom.'' Riley, 42 years old, suffered two heart attacks within weeks of each other in 1995, and a false alarm, which led to a trip to NYU Downtown's emergency room, after he returned to work.

''All the books will describe a classic heart attack, but the symptoms fit only 80% of the cases,'' says Dr. David Goldschmitt, Downtown's director of emergency services. The other 20% are mindbenders, like the Wall Street secretary who walked into NYU Downtown's emergency room with an excruciating toothache, which ultimately flagged the occurrence of a major heart attack.

<Picture: [Riley]>
Options trader Michael Riley survived two heart attacks in 1995 and has become big booster of NYU Downtown.

These victims, once diagnosed with the aid of EKGs and blood tests, typically require immediate treatment with thrombolytics, or clot-busting medications, such as Genentech's tissue plasminogen activator (TPA) or streptokinase (sold in this country by Sweden's Astra and Kabi Pharmacia). The drugs are potent blood-thinners, however, and in some patients can cause excessive bleeding. Goldschmitt recalls one emergency-room fatality last year that stemmed from a bad drug reaction.

Still, these medications have revolutionized heart-attack treatment, vastly increasing survival rates just since the mid-1980s. ''When I was a resident in 1982 and a patient had a heart attack, we would give him oxygen and morphine and the pain would go away,'' Cole says. ''We felt like we had accomplished something, when in fact we did absolutely nothing. Patients uniformly got sicker and developed heart failure. Now, with thrombolytics, patients get treated and get better, and are out of the hospital within four to six days.''

If heart-attack victims reach the hospital within an hour, and receive the necessary medications within another hour, ''it's almost as if they never had a heart attack,'' adds Schulman. ''In 1980, two in 10 patients hospitalized died. Now the mortality rate probably is less than 5%.''

Most heart attacks and chest pains occur between six o'clock and ten o'clock in the morning. And, not surprisingly, they're more common on Mondays than Fridays. The presumed culprit? A surge in adrenaline when one awakens and moves from a prone to an upright position, or is subject to increased stress. Higher levels of adrenaline can elevate blood pressure, speed up the heart rate and provoke arterial spasms, which, under the right circumstances -- say, in combination with a cholesterol blockage -- can lead to a heart attack.

Contrary to conventional wisdom, heart attacks are stock-market agnostics. The action in Downtown's chest-pain ward typically picks up not when stocks are soaring or plummeting, but when volatility and trading volume spike. ''When the market plunged in October 1987, you would have thought the exchanges would be trucking them over to me,'' Schulman says. ''But it doesn't work that way. It's not the direction, but the ride that counts.''

Cole seconds that observation. ''It seems to get busier in here when volume is rising than when stocks are going down,'' he says. ''Volume is a marker of people's distress.''

<Picture: [Cole]>
Dr William Cole.

Wall Street's typical heart-disease victim is a white male in his 40s or early 50s. In many cases, he's overweight and smokes. For a while, in the 1980s, widespread cocaine use erased the boundaries between the young and middle-aged, and the hospital's emergency room frequently treated young drug abusers with cardiac spasms. These days, notes Cole, it's not uncommon to see young traders with arrhythmias, or rapid, irregular heartbeats. ''Usually, the rhythm reverts back to normal without too much intervention,'' he says. ''But when we start to probe, we often get a history of stressful work, a lot of caffeine and frequent after-work drinking.''

Caffeine, by itself, probably doesn't play a big role in causing heart disease, while alcohol actually has proven beneficial in increasing ''good'' cholesterol. That said, excessive consumption of either can lead to arrhythmias. The biggest risk factors, notes Dr. Donald Gemson, director of medical services at Merrill Lynch, are high blood pressure, high cholesterol and smoking. Stress exerts its pernicious influence only indirectly, by elevating blood pressure and adrenaline levels, and prompting more eating and smoking.

To illustrate the point, NYU's Cole draws an analogy between the sensory overload of many Wall Street jobs and the Indianapolis 500. ''If you can't get off the raceway long enough to have a good checkup,'' he says, ''it's going to have a damaging long-term effect on the engine.''

<Picture: [Map]>
Best routes to hospital from financial area.

Many heart-disease victims get an early warning of engine trouble, but the Turks of Wall Street often ignore the signs. ''These guys write off chest pains to something they ate, and keep trading,'' Cole says.

In fact, adds Dr. Stephen Hamersky, corporate medical director of American Express, ''The biggest problem we have is people with symptoms suggestive of heart disease who need to be persuaded to go to the emergency room.''

Not that denial is peculiar to this crowd. Goldschmitt recounts the story of a hospital doctor suffering chest pains who wandered into the emergency room unannounced and just lay down, hoping to feel better. A staff member noticed and insisted on getting an EKG. Sure enough, the man suffered a massive heart attack, failed to respond to clot-dissolving TPA, and was sent uptown for successful surgery. ''It's a denial we see in professionals, in general,'' Goldschmitt says. ''They think they're in control, and don't seek help.''

Just as a successful stock trade depends on flawless execution, a happy medical outcome for most cardiac victims rests on perfect timing. On Wall Street, someone with suspicious aches or pains frequently checks in first with his corporate medical center. If the nurse on call is duly alarmed, she'll ring up an ambulance service and phone ahead to NYU Downtown's corporate liaison, Peter Fromm, a registered nurse who puts the emergency room on alert.

The ambulance initially brings the hospital to the patient, thanks to an array of ministrations often performed en route. NYU Downtown's ambulances, for instance, are equipped with EKG machines and defibrillators. Hospital paramedics can start an intravenous line, administer nitroglycerin and give patients aspirin to prevent further clotting. Tailor-made for the neighborhood's sharp angles and winding streets, Downtown's vehicles are slightly narrower than conventional ambulances.

Upon arriving at NYU Downtown, most Masters of the Universe undergo a demonstrable personality change. ''When faced with their own mortality, guys who are comfortable moving billions of dollars around tend to be much less bossy,'' Schulman reports.

Briefed by the ambulance crew, the hospital's triage nurse usually greets the incoming stretcher and whisks the patient into a special five-bay emergency room for patients with chest pain. The first of its kind in the city, this special area is a quiet, high-tech oasis off to the side of the hospital's bustling main emergency room. It was underwritten largely by the American and New York stock exchanges.

Approximately 4,500 patients utilize the hospital's chest-pain ER each year. ''Our philosophy is, if there's any suspicion of cardiac involvement, you go into that room,'' says Goldschmitt.

Roughly two-thirds of those admitted are discharged quickly, while the remainder are kept in the chest-pain ward for further evaluation. About half of this subgroup have heart-related problems, while 10%, or 150 people, are found to have suffered actual heart attacks. Most heart-attack victims are treated successfully with clot-busters, in part because of the hospital's concerted effort to reduce the amount of time it takes to administer such medications. In the mid-1990s NYU Downtown drastically lowered this time to 30 minutes from 83 minutes. The American Heart and Lung Institute has ranked the hospital one of the nation's four best in this regard.

Heart-attack patients can expect to spend several days upstairs at NYU Downtown, in the coronary care unit. Those who don't respond to medications, or who require further intervention -- about 15 victims a year -- often are shipped immediately uptown to New York University's catheterization lab for angioplasty or other invasive procedures. NYU Downtown lacks the facilities for angioplasty, open-heart surgery and coronary-bypass operations -- ''the big stuff,'' as Schulman calls it -- but the Downtown staff can insert balloon pumps and stents in these patients to stabilize their hearts for the ride uptown on the FDR Drive.

For heart-attack survivors, even those inured to Wall Street's rigors, the hardest work comes later. Diets must be revamped, cigarettes destroyed and life lived for as long as possible in a measurably slower groove. Mike Riley could write the book on a lifestyle overhaul. ''Eat regular meals? That's a foreign concept to a trader,'' he says. ''Now I eat breakfast, and take time out to eat lunch -- usually a turkey sandwich and seltzer or water. And I take lots of vacations, which most traders don't do because they're always afraid they'll miss a great trade.''

NYU Downtown's cardiologists also insist on a 12-week exercise regimen. Many patients choose to complete this program in the hospital's modern cardiac fitness center, which was funded largely by J.P. Morgan. With nurses present and Drs. Schulman and Cole just across the hall, patients attest to feeling more secure.

Besides, survivors of Wall Street's cardiac wars seem to like hanging out with each other, a lot like a team of investment bankers who've just put together a great deal or commodities brokers who've just pulled off a tremendous trade. And fortunately, camaraderie is one Wall Street habit that's not life-threatening.
------------------------



To: Sonki who wrote (110)6/6/1998 6:58:00 PM
From: ANANT  Respond to of 395
 
Section 5 0f article

BILL ALPERT
The beauty of drug stocks, almost obscured in the 1990s, is that they are immune to economic cycles. That could soon be an important attribute. Sure, Pfizer has gotten all the headlines with its Viagra, but Eli Lilly shows more promise. Why Medtronic ranks as the prince of pacemakers. Holding out hope for HMOs. Beware the nursing-home stocks.

June 8, 1998 <Picture: [Barron's Online]>
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Taking Stock

Beyond Viagra -- Buying the right health-care shares could be good for what ails your portfolio

<Picture: thin rule>
By Bill Alpert

Top Health Products and Their Markets

Health-care stocks have been behaving in an unusually unpredictable manner in the 1990s. They were famously knocked for a loop by fears of nationalized medicine in the first Clinton Administration. Then they were further depressed by worries about patents that were expiring on various best-selling drugs like Merck's Vasotec and Glaxo-Wellcome's Zantac. Most recently, the group has been revived by Pfizer's Viagra, the impotence drug that's become famous as a punchline on late-night TV.

Before long, investors may find yet another reason to warm to health-care stocks. With the economy and the stock market showing signs of stalling, what better place to put your money than in an industry that does well in good times and bad? Health, after all, knows no business cycles.

That helps explain why drug stocks have been among the star performers so far this year, rising 18% on average. New medical devices have also excited the market, none more so than Guidant's new generation of artery-expanding stents, which should bring the company $500 million in sales this year.

Mergers have played a role, too. Witness the stock action that followed United HealthCare's recent decision to join forces with Humana, or Monsanto's union with American Home Products.

<Picture: [Boston]><Picture: [Centocor]>

All the news is not good, however. While many health-care providers are successfully resisting the pressure to cut prices on their goods and services, one exception is likely to be the nursing-home industry. The stocks in this sector have been depressed, in large part because, starting this autumn, nursing homes will have to operate under the kind of fixed-payment regime Medicare imposed on hospitals more than a decade ago. The impact of this change is hard to predict on a company-by-company basis. But clearly, investors are standing on the sidelines until nursing homes show what kind of profits they can earn under the new system.

Not every drug stock has done well, either. Merck and Schering-Plough have lost luster in the eyes of investors who see few new drugs coming along to boost those firms' profits. Indeed, Schering's only blockbuster drug is Claritin, an antihistamine with a patent that expires in five years. As usual, the drug stocks that have helped investors most have been the ones with the strongest products, says analyst Paul A. Brooke, of Morgan Stanley Dean Witter. Looking ahead, Brooke sees performance remaining individualistic.

Brooke says that one of the best-performing stocks, Pfizer, may have upside potential even at its recent price of $104, or 38 times '99 earnings estimates of $2.70 a share. Pfizer continues to see strong sales growth for its billion-dollar antidepressant, Zoloft, and its antibiotic Trovan recently got the FDA's blessing for use against a broad spectrum of germs. Viagra can't be ignored, either. Today's stock price suggests that investors see annual sales of Viagra topping out at between $2.5 and $3 billion a few years from now, but Brooke thinks the pill's opportunity is greater still.

<Picture: [Forest]><Picture: [Guidant]>

One of Brooke's favorite stocks is Eli Lilly. The Indianapolis firm's prospects had seemed clouded by the expiration of its U.S. patent on Prozac in 2003. But some recent studies of a new Prozac formulation raise hopes that the antidepressant may find extended patent life. The studies show that a combination of Prozac and the Lilly antipsychotic Zyprexa appears to lift depression in many patients for whom drugs like Prozac by themselves haven't worked. This combination has been shown to work on patients who have refractory depression, and this group may account for up to 25% of all depressed souls. So if the combination treatment proves out, says Brooke, it may reach the market around the time of Prozac's patent expiration.

A more exciting dose of new revenues for Lilly will come from its new osteoporosis drug, Evista, launched in January of this year. Recent studies show that Evista doesn't aggravate breast cancer risk, as do other osteoporosis drugs. To that claim, Lilly may eventually be able to add the boast that Evista reduces risk of heart disease. Within five years, Brooke estimates, Evista could be nearly a $3 billion product for Lilly.

These developments could boost the earnings multiple of the $62 stock, says the Morgan Stanley analyst, above its current level of 27 times his 1999 estimate of $2.25 a share. ''The psychology is clearly bottoming out,'' says Brooke. ''And the issue is not the numbers, it's the psychology.''

Merck is the big drug company favored by Arnold H. Snider, general partner of Deerfield Management. Snider and his New York City crew manage about a half-billion dollars in hedge-fund money, all dedicated to health-care stocks. Sad to say, Snider's fund is closed to new money. Net of fees, the fund has averaged annual returns of 28.6% for the past four years. Snider believes the share prices of outstanding outfits like Pfizer or Warner-Lambert have already taken into account the firms' growth prospects. And many other stocks, especially those of British and Swiss drug companies, are a bit overpriced in light of the pathetic sales growth the companies are showing.

<Picture: [Glaxo]><Picture: [Lilly]>

The only big name Snider cares for is Merck. He points out that Merck has the lowest price-to-earnings multiple in the group: At $114, its shares trade for 22 times 1999 estimates of $5.15. Despite growing sales of Merck drugs like Fosamax, for osteoporosis, and Zocor, for cholesterol, investors worry about patents that are slated to expire in the coming few years on such key Merck heart drugs as Vasotec, Prinivil and Mevacor. But Snider says that three new products could keep up Merck's momentum. They are Singulaire, a new asthma drug; Maxalt, a migraine drug, and Vioxx, a new kind of arthritis drug that won't upset stomachs. ''Our sense from talking to physicians,'' says Snider, ''is that all three of those drugs will be blockbusters.''

The hedge fund manager's unease with European drug makers is aggravated by two major issues. Pricing for any drug has tended to vary across Europe, with Northern European countries reimbursing makers at higher prices than Southern European countries do. But with a single European currency next year, wholesalers will find it easier to move drugs from the cheaper nations to the expensive ones, making it tough for drug makers to keep a price cut in one country from rippling across Europe. Snider's other concern is that Year 2000 software problems (caused when the millennium flummoxes computers that track only the last two digits of a calendar year) will be much worse in Europe than in the U.S. Nations with socialized medicine may find themselves particularly snarled up, making it hard for drug makers to collect their receivables.

Glaxo-Wellcome is the kind of Euro drug stock whose valuation puzzles Snider. Glaxo's Zantac, an ulcer drug, is history now that its patent has expired, and across the rest of Glaxo's product line, rival drugs are swarming: New AIDS antivirals from the likes of Agouron Pharmaceuticals, Bristol-Myers Squibb and Merck have grabbed share from Glaxo's Retrovir; a raft of faster-acting migraine drugs will soon bite into the business now done by Glaxo's Imitrex, and Glaxo's asthma franchise has but one strong grower, named Flovent. Glaxo's earnings in the first half of '98 will be down by 15%-20% from year-earlier levels, says Snider, yet Glaxo shares remain pricey.

The money manager is more enamored of small drug stocks. One smaller firm with the potential to more than double its size, says Snider, is Forest Laboratories. The company will launch an antidepressant drug called Celexa this summer. Warner-Lambert will help market Celexa, whose claim to fame is that it has fewer harmful interactions with other drugs than does Prozac. That may make Celexa a more palatable drug for the elderly, says Snider. Forest Labs shares trade around $33, which amounts to 34 times expected earnings for the fiscal year ending next March.

A biotech favorite of Snider's is Centocor, whose clot-preventing drug ReoPro looks better with each new study. In the first quarter, Centocor presented results of a trial involving 2,400 patients with blocked heart arteries, each of whom underwent coronary stenting or balloon angioplasty. There were 54% fewer deaths among patients who were given ReoPro and a stent than among those who were given a placebo and a stent.

Even the FDA approval of rival products from COR Therapeutics and Merck doesn't dim Snider's enthusiasm for ReoPro. In just 10 minutes, he says, the Centocor product can cool down about 97% of patients who show up at an emergency room with dangerous angina, while the COR and Merck products take longer to kick in, and even then they help only about half of such patients.

With Lilly handling ReoPro's marketing, ReoPro's sales grew 35% in the quarter ended in March of this year, to $70 million. With the drug selling for more than $1,000 a shot, and a couple of million new heart-disease patients showing up every year, there's enough opportunity to leave investors comfortable even though the stock, at a recent 36, is trading at 40 times next year's expected earnings.

And Centocor has another ace in the hole. Last month, a panel of FDA advisers urged approval of the company's Avakine product. If approved, Avakine might sell for $5,000 a year to a good portion of the 250,000 Americans who suffer from the severe intestinal ulcers known as Crohn's disease.

<Picture: [Medtronic]><Picture: [Merck]>

Recent headlines about possible cancer cures have caused a surge in biotechnology stocks. But even though biotech firms like EntreMed have beaten cancerous tumors in mice, investors will have to wait a long time before human tests show what such drugs are worth. Closer at hand are cancer treatments such as Retuxan, a recently approved product from IDEC Pharmaceuticals that may become a first-line treatment for lymphoma. A partner with IDEC in developing Retuxan is biotech veteran Genentech, which, by the way, is hoping for fast-track FDA approval for another drug, Herceptin, which has been shown to slow the progress of breast cancer in certain patients.

Ironically, FDA approval can be the undoing of a biotech stock if the product turns out to be a poor seller. That's the warning from another hedge-fund analyst who did not want to be named. Recent approvals he's wary of include ones granted to COR Therapeutics and Organogenesis. ''Now they have to make their numbers,'' says the analyst, ''and that's where these things usually break down.''

COR's clot-prevention product, he figures, will run a poor third to those of Centocor and Merck, products whose clinical trial results were much better than COR's. Organogenesis has a $700 million market value now that the FDA will let it sell a replacement skin product. But the same product has precious few sales in Canada, long after that country approved it for sale to the public.

Most top-selling medical devices are good for the heart. Pacemakers and defibrillators, for example, send electric jolts to keep the heart firing with the right timing. Catheters deliver balloons and stents to prop open arteries that are the heart's fuel lines. Morgan Stanley Dean Witter analyst Glenn M. Reicin sees Medtronic and Guidant as the winners in the pacemaker market, and he sees Guidant and Boston Scientific as the ultimate winners in the catheter business.

Minneapolis-based Medtronic has more than 50% of the multibillion-dollar pacemaker market, and Reicin believes a refreshed product line may increase Medtronic's share further in 1998 -- at the expense of firms like St. Jude Medical and Germany's Sulzer Medica.

''Medtronics had an aging pacemaker product line,'' says Reicin. ''But its new products are excellent.'' Medtronic's new Kappa family of pacemakers is easier for doctors to program, and better at monitoring patients. Introduction of the new models provided a revenue spurt of almost 10% for the core pacemaker segment in the quarter ended in April. For the fiscal year ended in April, Medtronic's traditional pacemaker sales were better than $1.2 billion.

Implantable cardiac defibrillators have been a fast-growing addition to Medtronics' pacing business in the past decade, growing to almost a half-billion dollars in sales for the year ended in March. These devices provide a jolt to reboot the heart in patients whose main pumping chambers, or ventricles, have gone into spasms called fibrillation. Such episodes cause sudden cardiac arrests that few who have them survive.

<Picture: [pfizer]>

Because installation of a defibrillator can be a $40,000 procedure, the devices have penetrated just a small fraction of the several hundred thousand Americans who annually survive sudden cardiac arrest or who show ominous heart rhythms. But recent medical studies have shown that implantable defibrillators reduce the risk of death in this patient population by more than 50% in comparison with traditional drug therapy. Medtronics has asked the FDA for clearance to market its next-generation defibrillators, the Gem product line, which can do traditional pacing as well as jolt the heart's smaller atrium chambers when necessary.

Ever alert for new parts of the body to zap, Medtronics has a neurological pacing business, too. About 500,000 Americans suffer from the paralyzing muscle tremors and rigidity of Parkinson's disease, while nearly 10 times that number suffer from a less severe movement disorder called ''essential tremor.'' When medication can't help such patients, doctors have resorted to surgery that destroyed malfunctioning parts of the brain. A new approach puts electronic leads in these brain areas to deliver stimulation from a Medtronic pulse generator implanted in the chest. This electrical stimulation relieves tremors in many patients, without the side effects of medication or the irreversibility of the surgeon's knife.

Medtronics' sales of neurological stimulators, as well as implantable devices for dispensing medication or controlling incontinence, amount to about 15% of the company's revenues, but they are growing at a 30% annual rate. ''These are all virgin markets,'' says Reicin. ''A key issue is training doctors and getting these treatments through the reimbursement maze.''

Before some special charges, Medtronic reported earnings of $594.3 million, or $1.25 a share, on $2.6 billion in revenues for the year ended in April. That compares with year-earlier results of $530 million, or $1.09 a share, on $2.4 billion in revenues. Analyst Reicin says that his $1.51 estimate for the fiscal year ending next April looks very secure, giving him hope that Medtronics shares can move from a recent 55 to the mid-60s.

The implantable defibrillator market where Medtronic competes was pioneered by Guidant, the firm spun off by Lilly in late 1995. Guidant remains a tough rival in defibrillators and pacemakers, with nearly a half-billion dollars in sales of those products in 1997. Innovative new models, like the Ventak AV III, due from Guidant this year, will keep up the competitive pressure. The Ventak AV III can monitor and regulate the heart's atrial chambers and the ventricles, greatly reducing the number of defibrillator jolts applied.

Guidant's fastest-growing business has been in the catheter lab, where interventional cardiologists push balloons and stents into clogged arteries. The company's MultiLink stent has proven wildly popular since Guidant introduced it last October. Sales of these devices for the quarter ending in March of this year were $184 million, helping Guidant's vascular intervention business overtake its pace-making business in revenues. ''The MultiLink has been a phenomenal success,'' says Morgan Stanley's Reicin.

Going from practically nothing to 70% market share in just the first quarter, Multi-Link has showered a windfall of profits on Guidant. Net income in the March '98 quarter was $55 million, or 37 cents a share, on total corporate revenues of $470 million. The company could earn about $2.22 a share this year, according to the First Call consensus, and $2.51 in 1999.

But the company knows that Multi-Link's 1998 revenue explosion will be a hard act to follow in next year's comparisons, says Reicin, so Guidant is investing heavily in developing new products, as well as augmenting its pacemaker sales force. One of the new product areas Guidant likes is coronary radiation. Balloon angioplasty's deficiency is the tendency for arteries to narrow again after the procedure in 25%-45% of cases. By propping open arteries, stents have addressed that problem, except where the narrowing results from scars, which may be the case in up to one-third of angioplasty patients. Guidant is one of many firms testing radiation as a way of preventing the cell growth that builds into a scar. By slipping in a radioactive wire after a stenting procedure, cardiologists have prevented later scar formation, at least in the small number of patients enrolled in early research.

A small public company that's at the forefront of coronary radiation is Novoste. As a development-stage company, Novoste has no sales, but investors are sufficiently impressed to have bid up the Norcross, Georgia-based firm's 10 million shares to around $26 each. Reicin thinks Novoste might make an attractive acquisition for a larger angioplasty firm, should coronary radiation prove effective and safe.

Hedge-fund manager Snider concurs on the value of Novoste. ''The stent markets right now are getting close to saturation,'' he says, ''so even at best, you've got only a couple more years of rapid growth in that market.'' Procedures like coronary radiation may then be where the growth is, because scars that intrude through the metal mesh of stents may be impossible to fix, unless prevented by radiation.

One large angioplasty firm that's been late to the stent market is Boston Scientific. With stents now used in most balloon angioplasty procedures, this deficiency hurt the firm's March '98 quarter, when Boston Scientific reported net income of $67 million, or 34 cents a share, compared with $75 million, or 38 cents, a year earlier. The lower earnings in the '98 period came despite revenues that grew 9%, to $470 million. Narrower profit margins show how the maturity of the balloon-angioplasty business is pressuring prices.

Boston Scientific is working hard, therefore, to gain approval for its NIR stent product in the important U.S. and Japanese markets. Those approvals should come in the next few months, says Reicin, giving Boston Scientific a shot in the arm, and helping it reach 1998 earnings of $1.90, then '99 earnings of $2.50. Every $50 million in stent sales would be worth an added eight to 10 cents a share to the firm, reckons the analyst.

With an approved stent, Boston Scientific will offer one-stop shopping for angioplasty procedures, as its archrival Guidant already does. That will surely turn up the heat on Arterial Vascular Engineering, the Santa Rosa, California, firm whose rocketing growth in stent sales has pushed its stock market value as high as $2.9 billion (at $45 a share times 63 million shares outstanding), a valuation that many investors found extreme, especially in relation to the company's annual revenue run rate of $275 million.

''Arterial Vascular Engineering has done very well as a pure play in stents,'' says Reicin, ''but can they continue to do so well?'' The firm was early into the stent marketplace with a superior product. A year from now, however, Guidant and Boston Scientific will both have stents that will be comparable to AVE's product. ''When you have three acceptable products on the market,'' speculates the analyst, ''then economic considerations and bundling will become more important.''

One other reason that AVE shares have slipped to recent levels of $29, notes Arnold Snider, is that the firm is one of a few potential buyers of Pfizer's Schneider angioplasty subsidiary. If AVE made such a deal, it could round out its product line but might substantially dilute its earnings, which totaled $56 million, or 86 cents a share, on $206 million in revenues for the nine months ended March '98.

When it comes to the companies that provide health-care services, as opposed to health-care products, the most exciting part of the game has become mergers. Last month, Minneapolis-based United HealthCare announced plans to purchase Humana for stock valued at over $5 billion. Humana, based in Louisville, Kentucky, is the HMO business that remained after Columbia/HCA Healthcare bought the Humana hospital chain. The deal, if it passes antitrust scrutiny, would create a managed-care monster with over 10 million members and annual revenues of $27 billion.

Analyst Kenneth Abramowitz of Sanford C. Bernstein & Co. thinks the post-deal clout enjoyed by United HealthCare will make it the nation's most attractive HMO stock. Assuming the deal goes through, he thinks United HeathCare could earn $2.75 this year and $3.35 the next, which wouldn't make a recent share price of $62 seem so lofty.

With HMOs ending their price war, Abramowitz sees an improving environment in health-care services, where providers can even raise prices, as long as HMOs succeed in passing through the costs to the corporations that pay most of America's premiums. Hospitals and medical practices will continue seeking regional dominance as a way to gain clout in pricing their services. Consumers will continue to want unrestricted access to health care, as long as they feel that someone else is paying the premiums. ''There's no lid on prices any more,'' says Abramowitz. ''The HMOs have to force Corporate America to pay for its irresponsible employees because the employees think they are spending the corporation's money.''

With politicians drafting bills to stop HMOs from rationing health-care services, Abramowitz thinks well-operated hospitals and physicians' practices will do well. His favorite hospital chain is Tenet Healthcare, the Santa Barbara-based operation that has a dominant share in the Los Angeles metro area. He estimates that Tenet could report earnings of $1.73 a share for the just-finished May '98 year, and $2 for May of '99.

PhyCor is Abramowitz's choice among firms that specialize in consolidating medical practices. Rationalizing the operations of doctors is one of the toughest tasks in health care, but PhyCor managed to stay on its feet as rivals like MedPartners and FPA Medical Management have tumbled. PhyCor could earn 97 cents this year and $1.25 next year, says Abramowitz.

As noted above, one health-care sector that could remain under a cloud is long-term care, particularly nursing homes. Medicare is about to impose fixed payments on nursing homes, pegging the payments to a national average and imposing them progressively over the next four years. This coming fiscal year, Medicare will calculate 25% of payments under the fixed formula; then 50% the following year, 75% the year after that, and 100% in the fourth year. ''What the companies are going to earn is very difficult to predict,'' says Deerfield Management's Snider. ''I don't think there is any company in the industry that won't have to take costs down.''

But nursing home stocks have done so poorly, compared to the market, that the worst case is already factored in, argues Howard C. Capek, who follows the industry for Credit Suisse First Boston. Capek has not plotted out the impact of the just-announced Medicare rates, and he thinks the nursing-home firms themselves are still crunching numbers to predict the impact. But he believes those chains with some experience in dealing with private managed care are the ones that will do best. His picks are Genesis Health Ventures, of Kennett Square, Pennsylvania, and Sun Healthcare Group of Albuquerque, whose shares trade on the New York Stock Exchange for about $24 and $16 each, respectively.

The fortunes of health-care companies will continue to be mixed, as illustrated by the varying situations of a winner like Pfizer and the currently besieged nursing-home group. But taken together, the health-care sector offers some of the fastest-growing businesses in America, plus some of the companies that are most resistant to any downturns in the economy. In short, it's a hard group for investors to ignore.
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To: Sonki who wrote (110)6/6/1998 7:01:00 PM
From: ANANT  Read Replies (1) | Respond to of 395
 
Section 6 of the article ( last)

BILL ALPERT
Don't be surprised if your next surgery is performed by a robot. Right now, a few intriguing companies are making medical versions of good old R2D2. Someday they could alleviate the need for all those open-heart operations. If the procedure takes longer than 30 minutes, you'll want a robot in the room. Does this mean trouble for Heartport and CardioThoracic Systems?

June 8, 1998 <Picture: [Barron's Online]>
ÿ

Cold Hands

Get Ready for Dr. Robot -- Will new gizmos make open-heart surgery obsolete?

<Picture: thin rule>
By Bill Alpert

Does your doctor have a cold bedside manner? Don't complain too much; your next surgery could be performed by a robot. This may sound like science fiction, but robots are about to be used in the operating room, particularly to carry out procedures in places that a surgeon cannot easily reach. A prime example is minimally invasive heart surgery, which is performed through small incisions between a patient's ribs. This approach is a lot less traumatic than open-heart surgery, but to pull it off properly, a surgeon has to be something of a contortionist, and he also must have an extremely steady hand.

"Minimally invasive surgery is bad ergonomics today," says Dr. Mehmet Oz, an accomplished heart surgeon who performs 450 operations a year at New York City's Columbia-Presbyterian Medical Center. "It's a whole extra component of variability. There's less control if something does go wrong."

That helps explain why minimally invasive surgery is used in only about 5% of U.S. heart-repair operations right now. Part of the problem is that it forces surgeons to use some pretty cumbersome tools. More than a foot long, these special tools tend to amplify tremors from even the steadiest hand. In addition, the tools require surgeons to use movements exactly the opposite of the ones they use in open-heart operations. That's no easy feat when you're stitching the paper-thin tissue of a heart artery. So for now, the vast majority of surgeons prefer to crack open a patient's chest and be sure they get the stitches done right.

<Picture: [Robot]>

But robots could change all that. In recent weeks, a robot helped carry out several minimally invasive heart-bypass operations on calves. The surgeon in charge was Dr. Ralph J. Damiano Jr., chief of cardiac surgery at the Milton S. Hershey Medical Center in Hershey, Pennsylvania. In about a month, Damiano plans to take X-rays to see how the calves' grafts are holding up. He hopes that within a year, given FDA approval, he'll be able to use a robot to perform similar procedures on humans.

We wouldn't be telling you all this unless there was a stock-market angle, and in this instance there are several. To begin with, the use of robots could cut into the business of Heartport and CardioThoracic Systems, two companies that sell tools for minimally invasive heart surgery. That would be only the latest blow to the stocks of these companies, which have suffered because minimally invasive surgery has yet to catch on.

Then there are the companies that make surgical robots, including Computer Motion, of Goleta, California, and Intuitive Surgical Devices, of Sacramento. Computer Motion went public last year at $14, and it trades now for $15 on Nasdaq, giving the company a value of about $120 million. Intuitive Surgical plans to issue shares to the public soon. These companies hope to start testing robot arms that will cut and stitch inside a patient while transmitting visuals and even a sense of touch to the surgeon sitting nearby.

Already robots are being used in hip-replacement operations. The maker of this type, which is sold under the brand name Robodoc, is Integrated Surgical Systems, a Sacramento firm whose shares trade on Nasdaq's small-cap market. Robodoc performs a specific bit of carpentry: drilling holes in a patient's bones so that surgeons can easily implant hip replacements. ISS has sold 14 Robodocs abroad, but it hasn't even begun testing the system for approval in the U.S. The company's sales were $5 million last year, compared to $2.3 million the year before. ISS lost $4.5 million last year, or $1.20 a share, compared with a '96 loss of $3.4 million, or $4.78 a share. With over five million shares outstanding, ISS's recent trading price of 61/4 values the firm at a generous $30 million.

The company selling the most robots to surgeons these days is Computer Motion. More than 350 hospitals and clinics around the world are using its Aesop robot, which responds to voice commands to position an endoscope, the fiber-optic television camera that surgeons use to peek around inside their patients. Computer Motion's chief executive, Robert Duggan, says that Aesop, now approved by the FDA, has taken the place of a surgical assistant in more than 40,000 procedures.

In April, Computer Motion got FDA approval to market a second product, called Hermes. The idea here is to extend voice control to other instruments in the operating room and give feedback by having Hermes report back to the surgeon. Computer Motion's Duggan expects shipments of Hermes to start in the third quarter. The established surgical supplier Stryker plans to push Hermes through its 120-person sales force.

Perhaps the closest thing to popular notions of a robot will be Computer Motion's next product line, Zeus. A prototype of this model was used in the heart operations done on calves by Hershey Medical Center's Damiano. Zeus can wield operating tools under the constant control of a surgeon, who maneuvers hand grips that give him tactile feedback. The system lessens the hand's involuntary tremors and can scale down movements so that a one-inch movement of the surgeon's hand becomes a quarter-inch movement by the robot's tool.

Duggan says that 24 surgeons around the world have used Zeus to practice heart bypass on animals or cadavers' hearts. The robot can do the required gripping, cutting and stitching through chest incisions that are pencil thin. If the FDA approves, the first tests of Zeus on humans could occur by yearend.

Medtronic, the large medical-device firm, plunked down $5 million last year for rights to market the Zeus system to heart surgeons. Johnson & Johnson will also market Zeus. With $30 million in cash, and an annual cash-burn rate of less than $8 million, Computer Motion can probably afford the time it takes to prove Zeus, especially if Aesop and Hermes sell well.

Computer Motion's revenues were $6.6 million last year, the year it went public, mostly from sales of Aesop, compared with $4 million in 1996. On those '97 sales, the firm lost $9.2 million, or $2.12 a share, compared with a 1996 loss of $4.6 million, or $2.68 a share.

Duggan estimates there are perhaps 10,000 video-equipped operating rooms around the world that are prospects for Aesop, at $65,000 per robot. The Hermes operating-room control system, which Computer Motion plans to sell for $10,000 each through Stryker, could have an even larger market. The Stryker deal calls for delivery of a minimum of 400 units in the 12 months, starting in this year's third quarter.

Duggan hopes for FDA clearance to market Zeus by the end of next year.

Wall Street analysts forecast that Duggan's firm will first report profits in the year 2000, with about 60 cents a share on sales of nearly $70 million. By then, this bit of science fiction will be the kind of reality that gets Wall Street excited.

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