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Biotech / Medical : XOMA. Bull or Bear? -- Ignore unavailable to you. Want to Upgrade?

To: E.J. Neitz Jr who wrote (6577)	6/24/1998 3:54:00 PM
From: Terry Whitman	Respond to of 17367

It has been pointed out to me- and I believe that I shared it here before- that XOMA periodically sells out more shares. They use the opportunity of good news to do this, hence diluting the demand, and holding down the price. This dog will probably never get up off the porch if it keeps eating so much.

To: E.J. Neitz Jr who wrote (6577)	6/24/1998 8:22:00 PM
From: Tharos	Read Replies (1) \| Respond to of 17367

Lets revisit a thought process opalapril started, that being: what affects Xoma's price?: Macros: We have just recently concluded a class action law suit against us, the plaintiffs won. It has been less than one year since we called a halt to the failed E5 program. Wall Street hates the word "sepsis" and anything to do with it. One must remember Xoma is not the only company to fail with a "sepsis" product. Small and mid caps are out of favor. Value investing is out of favor. Biotechs as a group remain out of favor, as they have been for several years. Momentum investing rules the heap and Xoma has had no momentum for quite a while. Checkered past: Disappointing, unproductive sepsis research for more than two decades. Repeated share dilution. Lack of large fund interest or any analyst following. Disappointment over the failure to strike a deal with a large pharmaceutical. Disappointment over continuation of P-3 trial by DSMB. Uncertain future: Skepticism about the potential market and actual economic return to be expected for any BPI compounds on the horizon, even if approved. Impatience over the comparatively long period until possible FDA approval (another year or year and a half?). Likelihood of further share dilution to raise needed cash. And # 1, of course, is the possibility of FDA denial. Worry over possible competition from any number of other very ingenious biotechs in closely related fields. This includes potential patent disputes and litigation costs. I tend to disagree with opalapril's position that a prudent investor would have nothing to do with Xoma, rather I take the position that this is a highly speculative stock, consequently it does not appeal to all investors, nor does it necessarily appeal to all investors who devote a portion of their portfolios to speculative issues.