Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Biotech / Medical : Paracelsian Inc (PRLN) -- Ignore unavailable to you. Want to Upgrade?

To: Jonathan Schonsheck who wrote (4153)	2/2/1999 6:48:00 PM
From: John H. Farro	Read Replies (1) \| Respond to of 4342

Jonathan and others, I think today's news is good but evidently the market was less than impressed. Why did we see a price decrease rather than an increase? Because the market doesn't believe we have a deal. This sentence is key: The terms of the partnership, including financial considerations and the name of Paracelsian's partner were withheld pending completion of a formal agreement. As far as the market is concerned, PRLN and the Japanese company have just agreed to reach an agreement--a letter of intent if you will. They have not signed a solid agreement--or at least that's what the market thinks. Paracelsian had a letter of intent to reach an agreement with Murdock Madaus Schwabe last March. No agreement was ever reached though PRLN came up with a deal with Scherer that was probably better than anything we could have come up with Murdock Madaus Schwabe. The market is uncertain at this point that any agreement will actually be finalized with the Japanese company. And even if the market knew that an agreement would be finalized, it is uncertain that the terms would be favorable to PRLN. Remember, PRLN gave up the rights to the AhImmunoassay to Dow for a song under old management. The market may fear a repeat performance. When will we see an announcement that a finalized contract has been reached? I am guessing that they have already agreed to all the major terms for the contract and that no show-stoppers remain to be negotiated. I doubt they would make this announcement if there was a realistic probability that it would fall through. The wording of the news release implies that this agreement is more solidified than the mere letter of intent to negotiate an agreement with Murdock was. Note the wording: the partnership was established. They didn't say that they intended to negotiate a partnership. They didn't say there might be a partnership. They said that the partnership has been established. We also know from the 10-K that they expect to receive revenues from this agreement by the end of March. So we can expect an announcement of a signed contract within the next two months at the latest. My guess is that it's just a few weeks away, but that is just a guess. When the contract is announced we should have a significant increase in price. It would have been nice to see a jump in price today. The company could really use a higher stock price to help them raise money through a private placement. Robin