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Biotech / Medical : VD's Model Portfolio & Discussion Thread -- Ignore unavailable to you. Want to Upgrade?

To: Rocketman who wrote (5029)	5/30/1998 1:21:00 PM
From: Vector1	Read Replies (1) \| Respond to of 9719

Rman, I think we should cover. I admit I am chicken sh_t when it comes to shorts but this one scares me on the upside short term. If we want to play for the long ball I have an idea which I will talk to you about later. I think ICOS has a decent chance of a big run. If it runs to $28-30 with all deference to Rick its a nice short because with a major upcoming dilutive event on the way it will take a nose dive at some point. The company is at least 3 years from substantial revenues and will need to add a sales and marketing infrastructure ( they say they want to be an intergrated pharma). Creating the infrastructure before revs hit will be quite expensive and suck cash like a vacuum on steroids. They are going to have to raise a lot of money which means more shares and they already have almost 40million not including warrants and options. A $30 per share price with an additional 10m shares translates into a $1.5b market cap. When you consider that revs are far away, there is at least 1 competing product with a dominant market position by a major pharma powerhouse and the 30-40% discounts biotech are geting on future earnings a $30 per share price will not be sustainable. V1

To: Rocketman who wrote (5029)	5/30/1998 9:44:00 PM
From: scaram(o)uche	Read Replies (1) \| Respond to of 9719

Rman, Stan: I agree with you guys. Honest. The argument for a short is compelling. However.... just imaging this "what if"...... Sales estimates of $4 billion/year start showing up for V, and Rathman says that the ICOS PDE5 inhibitor is looking like it's superior. Imagine that there's a new float put under the issue, and that one of every two reporters in the world starts to hound those in the clinical trials, asking "seeing blue?" or "got that silly extra centimeter?" I'd rather be long than short Monday morning. It's not like Rathman to drive the stock, but..... as you indicated, they will need money, and he may feel justified to drive it a bit, that they've got a good shot at some of that MED pie. I was not surprised to hear that lurker McCamant was saying "reduced side effects relative to Viagra", as that was the rumor that I had heard. But, I was surprised to hear Rathman quoted as saying such later in the day. Rman...... Monday morning..... CNBC was saying that he'll be on. I've heard him talk about the extensive testing in phase I, and his casual style makes you want to believe. We will have some biotechs that get lucky and break through to independent pharma status. There's a new world of pharmaceuticals out there, and an accommodative FDA. I was out there in early '95 predicting that Merck's marketing muscle wouldn't be a big factor for Agouron and Viracept, that, given similar efficacies, it would be side-effects and convenience that would carry the sales. Same here.... if a PDE5 inhibitor clears phase III with (1) Viagra selling without significant concerns about toxicity, and (2) decent efficacy and reduced side effects relative to Viagra, the company that makes it will bury Pfizer. It won't take much of a marketing budget at all. ICOS may only need a finance bridge to independence. Let's see what Rathman says Monday morning. I'd play it conservative, if I were him. Anybody know what Glaxo's cut is? I'm guessing under 5%. Rick