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Biotech / Medical : Ligand (LGND) Breakout! -- Ignore unavailable to you. Want to Upgrade?

To: Henry Niman who wrote (24433)	8/12/1998 10:57:00 PM
From: Machaon	Read Replies (3) \| Respond to of 32384

Hmmmm!? That means that "we" as shareholders just bought around $220 million in drug development and science, and a revenue producing drug, for about $75 million, providing that ONTAK gets approved. That's a $145 million discount, otherwise known as a fire sale. There's another 4 or 5? fusion protein compounds in the pipeline. Doesn't sound like too bad a deal to me, unless the science of fusing a poisonous substance and a protein doesn't work. But, SRGN at least got it as far as the FDA, so there must be some merit to it. Good luck, Bob

To: Henry Niman who wrote (24433)	8/13/1998 12:44:00 PM
From: Robert L. Ray	Respond to of 32384

>>>It's the right ball bark, BARS said "over $200 million" by SRGN, plus $20 million by LLY.<<< Should LGND become profitable in the near future I wonder how valuable these accumulated deficits by SRGN will wind up being to LGND for income tax purposes? I read the link you posted a while back about the time limit for using losses to offset income possible being extended. Perhaps you could post the link again. LGND of course has it's own accumulated deficits to offset taxes on future profits for quite a while I would think. At any rate if nothing else I'd say the SRGN aquisition, apart from everything else is worth something just for the potential tax value of their accumulated deficit alone. This is one reason why I've been surprised by the lack of merger activity between large pharma and biotechs with large accumulated deficits. I mean for a large pharma with profits right NOW, it would seem that an aquisition such as SRGN could be about 1/2 to 2/3 paid for by tax benefits alone. Although admittedly I'm not familiar with the tax rate that large pharma pays. I know most of them have plants in Puerto Rico which is something of a tax haven for them. At any rate I'm certainly no expert on matters such as this so perhaps my reasoning is somehow flawed. It would be nice to think that at some point in the future the LGND and SRGN accumulated deficits could all be used to offset taxes before any time limits on the use of them ran out. The fact that accumulated deficits have an expiration date for income tax purposes seems to me to be a very, very, unfair tax code feature. I found the information in the link you posted to be very interesting and hopeful in this regard. Oh well, here's hoping for some profits in the future to make use of all these accumulated deficits.