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

To: Andreas Helke who wrote (5327)	7/15/1998 5:31:00 PM
From: Aron Rosenthal	Read Replies (1) \| Respond to of 9719

Andreas, I have recently purchased some stock in ANIK, GENZ, and LGND and happened to notice your message including these titles. My portfolio also includes ARIA and ABT and I was wondering what your opinion, or anyone else's, was on these stocks. Also, ANIK took a huge drop today so I was curious to see if you heard any news regarding the company. Aron Rosenthal

To: Andreas Helke who wrote (5327)	7/15/1998 6:19:00 PM
From: Peter Singleton	Respond to of 9719

Andreas, Tom, Peter, Thanks for offering your picks for 10x returns. A further question for you. Could you give someone, myself for example, a roadmap that I could follow in evaluating the company(ies) you've identified? I know how to do it in about 40 hours (I don't really know how many hours, but it's alot). But I have no idea in say, 2-4 hours. Here's what I'm driving at. As a biotech investor, I'm looking for companies that have a shot at a 5x return in 3 years, with further upside to a total return of 10x over 5 years. Enough underlying value is being created in some of these companies so that these types of returns are possible. Then, there's also the issue of risk. Even in the best of these companies, there's an inordinate amount of risk, hence the venture level returns. But I'm also trying to look at my downside on a company, since a few 0x or .1x can burn overall portfolio returns pretty quickly. There is no place I can go to come up with an informed carefully reasoned opinion on any one of these companies, however. Let's walk through the available sources of info. - Company pitches? of course not. It's not their job to present an objective view of the risks and potential of their company. They're salesmen, putting their company's story in its best light. However, some companies are more forthright in the way they present their story than others ... this is a point I need to get to with a given company: I need to develop a company-specific lens to evaluate what they say ... and in some cases the company-specific filter leads me to run from the company. - Analysts reports. biased almost to the point of uselessness. Analysts are compensated on banking and securities transactions, and this governs their presentation of the facts. However, often a good presentation of the technology and the central issues facing the company ... but not always - Independent stock letters. Track record is pretty poor. Rarely a balanced view on a particular stock. Often the analyst will take a stance on the company (bullish or bearish), and look at all data in the light of their stance. Plus the bulls have an innate bias toward supporting a company's "line", since they are co-opted, if you will, by their access to management. - buzz in the investment community. The "informal" rumor mill. Inaccessible to most retail investors, including highly sophisticated ones. Great source of "in-the-know" opinion ... important to tie into, but still, often appears to be wrong in retrospect, and is no substitute for an independent, informed opinion. It's frequently a good leading indicator of upcoming issues before they hit the market's screen. - stock boards like SI. Really valuable, but highly flawed. First, too high noise to signal ratio. Very little self-imposed discipline on the value, relevance or the accuracy of the information or views posted. But tremendous nuggets embedded in a thread that has one or more astute, objective people who post on it. continued on next post ...