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Microcap & Penny Stocks : Pharmos(PARS) -- Ignore unavailable to you. Want to Upgrade?

To: Rick Strange who wrote (1213)	9/5/1998 6:08:00 AM
From: Ariella	Read Replies (1) \| Respond to of 1491

PARS new outside IR firm has quite an exciting client list. Ruder Finn has upwards of 400 employees and extensive experience in the health care field. See the client list for health care, noting prestigious firms like Novartis, Pfizer, etc. ruderfinn.com Note Ruder Finn's role in the merger that made Novartis the giant that it is today: <<When Sandoz and Ciba-Geigy came together last year in what observers call the largest corporate merger in history, Ruder-Finn's Kathy Bloomgarden enjoyed a role in the planning and communication of the deal's details that ought to be the envy of every strategic PR counselor... >> prcentral.com Note its role even with "young" biotech firms: (see small print at bottom) biz.yahoo.com In other words Ruder Finn has the background to help us find a good co-sponsor for HU-211 and to put us on the map in the investment world. If I ran an emerging pharmaceutical company, I sure would want them aboard if I thought happy news was coming soon. As for PARS shares themselves, I was a buyer this week, taking advantage of the softness caused by the general market downturn and two items specific to PARS: 1) a misunderstanding about the FDA announcements concerning tamoxifen for Genentech (GNE) and Zeneca (ZEN), whose stocks temporarily zoomed up on the news; 2) rumors about the contents of an S-3 SEC document that eventually got released on Friday, which registered for sale in the future up to 3 million common shares. The first event probably made some people erroneously conclude that we had lost part of our drug pipeline; the second probably made people erroneously conclude (until the actual document was released) that another Castle Creek-type stock deal might be in the works. For the record, just because other companies are selling tamoxifen doesn't put us out of the running in that market; and the new S-3, although it would represent some dilution, has better terms than the convertible preferreds we've done and indicates our capable CFO is already prepared to fund those months in 1999 when we might need cash before the revenue stream from Alrex and Lotemax cover the cash burn rate. I am very excited about the new Investor Relations firm. Hiring them just before the release of HU-211 results and the annual meeting hints rather strongly that the company (properly frugal most of the time) believes near-term news will be worth the expense involved in this new relationship. --Ariella

To: Rick Strange who wrote (1213)	9/7/1998 11:54:00 PM
From: Ariella	Read Replies (1) \| Respond to of 1491

Quick notes on cash into the company: 1) Money in from the sale of shares: with regard to the S-3 registration of 3 million common shares dated 9/4/98, management has marked the box "yes" that asks "if any of the securities being registered are to be offered on a delayed or continuous basis..." I read this to allow for the possibility that the shares will not be sold immediately and, perhaps, not all will be sold eventually. This happened with the Series C preferred last year, in which only 63% of the number given in the registration statement were eventually issued. ( If the full 3 million shares are sold, we're up to 40.2 million shares outstanding. As of the date of the registration, Castle Creek still holds 4,500 Preferred C shares. ) 2) Money in from Bausch & Lomb: the S-3 also states that BOL will pay $1 million to PARS when it receives regulatory approval for LE-T in the US, plus an additional $1.6 million following similar approval in certain markets outside the US. I think the US money might come as early as late 1999, followed later by the European-related funds. 3) Partner payments for HU-211 and Tamoxifen Methodiode. HU-211: Assuming the unblinding of the first two cohorts of HU-211 Phase II go well, we ought to be able to find a well-funded partner for Phase III. That partner would probably kick in a nice amount for cash advances against future sales. BOL gave PARS $5 million and made a $2 million investment in its common stock in 1996. The potential for HU-211 is a lot higher and so should be the cash advance. However, I'd also be curious if any thread readers can make an educated guess as to how much money PARS will have to ante up for Phase III. BOL, although it gets 70% of the revenue stream from Alrex & Lotemax, only put up 50% of the Phase III clinical trial costs for those drugs. Ought we to expect a similar 50%-50% split for Phase III Hu-211? And what about the revenue percentage left for PARS? Tamoxifen Methiodide: I believe the company will seek out a partner earlier in this situation than it has in the case of HU-211 in order to add cancer research experts to its team. (The 1997 annual report already specifies that in 1999 the company plans to have its "tamoxifen analog program developed to a stage where [the company] will be able to secure a strategic partner for that program.") If so, additional funds may come from the outside for development of this drug in late 1999 when PARS will probably finish Phase I clinical trials. Since generic tamoxifen (ours is a patented analog) is already being sold by BARR Labs and Zeneca, I'm hoping this trial will go well. 4) Cash in from sales of Lotemax and Alrex. We're still in relatively early ramp up, but we've clearly turned a corner from being a total cash drain biotech to an emerging pharmaceutical house. We have top line.... quotes.globes.co.il _______________- It's that middle period in 1999, when Alrex & Lotemax probably won't cover the cash burn, that made managment register the latest common shares. I'd welcome opinions about this issue. Wall Street seems to have taken a dim view, but perhaps the upswing in trading from late morning to the close on Friday was actually a sigh of relief that the number of shares registered was not, in fact, higher. -Ariella