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Biotech / Medical : Incyte (INCY) -- Ignore unavailable to you. Want to Upgrade?

To: Mike McFarland who wrote (891)	3/5/1999 12:31:00 PM
From: Raymond Clutts	Read Replies (1) \| Respond to of 3202

Thanks very much to all of you who responded to my original inquiry about the effect that the research consortium may have on Incyte's prospects. As an investor I look to see what Incyte's competitive advantages may be in the near and long term future and without ignoring or discounting other factors, it seems to me that Incyte looks primarily to establish its competitive advantage by obtaining an intellectual property monopoly on the gene sequencing map that is central to all further pharma development. Please forgive my entirely unsophisticated technical perspective and my clumsy paraphrasing of sophisticated goals. Also understand that at present I am neither short nor long in this position although I will say that I have bought and sold two five thousand share positions in the last five months and just about broke even when I was done. In a nut, they want to be the patent/copyright hub that pharma companies must go through in order to establish new products on any kind of reasonable cost competitive basis. As a lawyer (though not a patent attorney), in reviewing this and other message boards concerned with Incyte's long term profitability it seems to me that the central concern is, "Will Incyte be granted any long term intellectual property rights in the expression of the human gene or must it's expression of that map contain some unique form in order to establish a perfectable property interest." (Phrasing this in the manner of my old moot court "neutral" statements of the issue on appeal.) My last classes on this are now over 10 years old but my clear recollection is that absent some novel innovation or unique manner of expression there is no protected interest under copyright or patent. From what I have read (and partially understand) it seems to me that if that then proves true, then Incyte's only competitive barrier is the cost of replicating its mapping results. Is it possible that while Incyte may win the race there is no protected property interest that comprises that "prize" and thus no long term pricing protection from any other competitive entity that is willing to establish its own gene mapping function and may then wish to replicate or expand on various sequences that Incyte has already mapped? Please understand that in posing this prospect I am not wishing for its realization. My goal is in fact to convince myself that this company is the great long term investment that I had believed it was in October 1998 at $22 a share and then to buy and hold it waiting for them to perfect their competitive advantage into a significant margin of profitability-instead of trading in and out based on a short term perspective. Most of the regular posts here do seem to be from technically sophisticated investors with a determinedly positive long term buy and hold perspective. While I would like to share that optimism, I do believe that from an investor's perspective the issue of pricing advantage is carried by what, if any, intellectual property rights can be maintained in the long term. Has anyone tried to entice any of the online ABA IP (American Bar Ass-Intellectual Property Section) members into a discussion of this issue? Can anyone help me frame the questions in a way that is calculated to shed some light on the issue? If so I'll do the posting on the ABA sites and try to track down some relevant case law that may help us to understand these issues and project recent case law's development. I apologize for the length of this post, but I have been reading everything written about Incyte on this and three other sites for months and hoped to offer some beneficial contribution to this discussion which seems to be the most substantive and civil conversation among many. Since the empirical issues are far beyond my ken I thought to advance our understanding of Incyte's prospects in this manner. Any takers on how we might phrase these as legal questions to gain some insights as investors? TANSTAAFL Thanks. Ray Clutts