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

To: opalapril who wrote (6605)	6/29/1998 3:01:00 PM
From: aknahow	Read Replies (1) \| Respond to of 17367

Opal, that's correct. Development expenses for the drug can to some extent be used as a tax credit. This is much more powerful than an offset to income. If you are in the 30% bracket and earn $10 million you owe 3 million of tax. A $3 million offset to income means you pay tax only on the $7 million or $2.1 million instead of the $3. With a tax credit of $3 million the whole tax bill would be offset. I did not comment on this before because first one must have the income or there is no benefit period. I did post that this status makes XOMA even more attractive for a potential acquirer, and does so now! BTW based on nothing, I keep thinking about Merck as doing a deal with XOMA. They attend some of the same Sepsis meetings, and I have no doubt MRK is aware of what XOMA is doing. Others see Genentech but I still think MRK makes just as much sense. Love to have Neuprex approved first and then a deal.