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

To: Robert K. who wrote (6881)	8/2/1998 11:25:00 AM
From: aknahow	Read Replies (1) \| Respond to of 17367

Great post by Kelley on the subject of dilution. I have tried to make the same points but have failed to express them as well. To: +FUGAZI (23766 ) From: +J.D. Kelley Saturday, Aug 1 1998 12:59PM ET Reply # of 23784 Fugazi, If you want to compare dilution with Isis you have a complicated analysis. Ligand has issued more shares 38M to 27 M. Comparable burn rates, and Liquid assets. Both have good science platforms. ISIS has borrowed $40M at 14% interest with a lot of the interest deferred. This compounds quickly. The 40 M is then used on targeted programs, Any profits from drugs out of this program are split 50/50. I'll argue that although ISIS has not issued shares for this collaborative agreement there is real and significant dilution to the potential earnings to the shareholder(14% interest and 1/2 the profits). Also check out the relationship with Novartis, Novartis owns 8% of ISIS and has significant rights to many of the products developed by ISIS, in many cases returning royalty payments to ISIS. Again I argue that dilution is present, just not directly in the form of stock. I like Isip's antisense program and am watching it closely for a buy, much like you are waiting on Ligand to give you a buy signal. Comparing ISIS and LGND, I believe that Ligand has more potential in its pipeline, and the relative dilution is comparable, all things considered. However , the biotech game is very difficult, and getting to the large indications is the answer to real value creation, I believe that Ligand has to and is going through incremental steps with Karposi's and Ontak to get to help support the time, $, and credibility to launch the big indication drugs. J.D. Ask Volume 096,1000 Prev.Close 11 13/16 Open 11 7/8 Day Range 11 1/8 - 11 7/8 Last Tick 0Down0 Avg.Volume 0197,3000 52-week range: 10 7/8 - 18 3/8 Discussion \| People \| MetaCrawler