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Biotech / Medical : Pharmos (PARS) -- Ignore unavailable to you. Want to Upgrade?

To: tom pope who wrote (127)	11/8/1998 10:55:00 AM
From: Ariella	Read Replies (1) \| Respond to of 1386

Dear Tom, Not sure what you mean to tell me....but Pharmos logged in almost a million in revenues in Q2 for the stocking of the distribution pipeline. The $90K in Q3 revenues suggests to me that in some sections of the country, the wholesalers needed to reorder and Pharmos shipped more product. I read that extra line in the 10Q that at the wholesalers' level, an additional $90K of stocked items was depleted. These are not added to the top line because they had already been accounted for in the Q2 number. If say, the three-month shipments went $30K for June, $50K for July, $100K for Sept., it means we entered Q4 at a quarterly pace of $300K. Of course, in a progressing ramp-up, the final shipment pace ought to be more like $400K for Q4. Not all of this will be booked as revenues because some will still be coming from the depletion of wholesalers' stock, not as new shipments. Are you seeing something different? For my part, I believe I have over-estimated the revenue contribution from Alrex/Lotemax this first year given the reported numbers. I will endeavor soon to talk to the company and figure out an estimate for Q4. Ramp-ups are hard to project because there's no history. Information flow is also slow from BOL to PARS in this case. -Ariella P.S. For the record, about two weeks ago I phoned the BOL Investor Relations office to do some snoop work. In many ways the phone call was a splash of cold water in the face -- some of my questions were so specific about Pharmos that the BOL spokesperson reminded me that the pharmaceuticals' division was very small relative to the other segments of the company. I reminded her that pharmaceuticals carried much higher margins than other lines of business in the company and asked if it wasn't the long range plan to raise BOL's P/E via expansion of this business. She agreed readily and became a bit more outgoing about info, including telling me that BOL had signed a co-marketing partner for Alrex. I acted appropriately surprised and said to my knowledge no partner had been signed. My gut tells me now that BOL, as rumors suggest, is training a sales force for Alrex. We should have a better upswing in the spring. Information flow may not improve that much for a while though. BOL is having high-level management changes effective Jan. 1.