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Biotech / Medical : Biotechnology Value Fund, L.P. -- Ignore unavailable to you. Want to Upgrade?

To: scaram(o)uche who wrote (218)	7/24/1998 5:34:00 PM
From: Peter Singleton	Read Replies (2) \| Respond to of 4974

Gosh, Rick, sorry to see you talking to yourself quietly in this corner of SI. Thought I'd join you so you don't have to keep posting to yourself ... : ) Those Yahoo Insider trade reports are a great window into stuff going on .... looks like Mark and the boys are tiptoing quietly as they add to their position in NRGN. It's hard to predict the bottom on the biotechs. Intuitively, I'd say when the last bull throws in the towel that's a good sign to buy. Maybe we should be monitoring Jim M's hotline for "guys, time to sell, NOW!" ... It's hard to believe on valuation alone that the second tier biotechs could go any lower. However, in this market, anything's possible: - hedge funds are playing in this game, and they can blast some of these stocks into oblivion, regardless of the merits ... I have a vision of driving around the Bay Area and La Jolla and watching people stumble out of buildings with blood gushing out of their noses like Republican Guards after a carpet bombing run by B-52s ... - "smart" money on Wall Street and Sand Hill Road is saying small and mid-tier biotechs are in a capital market death spiral ... get out with whatever capital you have left and find a nice little play ending in ".com" and make some money for a change (I've heard this, seriously! : ) - if the overall market takes a dive, the little, illiquid, under-followed, impossible to value biotechs will end up with price quotes starting in "0" - or below : ) Or to put it in economic terms, the small and mid-tier biotechs, while de-correlated with the market going up, are correlated, with higher beta, going down. Jim T, a broker friend of mine, pointed this out to me ... which made perfect sense based on my experience. Since yelling "fire" in a crowded theater is fun, but stupid, I should qualify the above three. My personal opinion is the third point above is the only of the three that is a real concern if you're worried about your mid-tier and small tier biotechs falling off the cliff from here. Peter actually I meant to say if you're worried about your mid-tier and small biotechs falling off the ledge they've landed on ... they've already fallen off the cliff it really, really could be worse. while the price to value ratio may be as bad, or worse in some cases, as it was 12/94, the companies themselves are much stronger, and much smarter. back then, a sizable percentage of them were running out of cash, and if the market hadn't recovered in 1995, there would have been mass liquidations, or state conversions to the "living dead" category.