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Biotech / Medical : Chromatics Color Sciences International. Inc; CCSI -- Ignore unavailable to you. Want to Upgrade?

To: JanyBlueEyes who wrote (4976)	3/22/1999 10:12:00 AM
From: Marconi	Respond to of 5736

Hello Janybird: Thank you for indicating the assumptions for CCSI's $330M 'market' size estimate. I believe the potential market for CCSI is substantially smaller than this CCSI marketers estimate. I also work under the heuristic that with the right product at the right time in the right place--in other words, executing properly a new business development correctly from the company side, externalities still cause odds of success to be one in three even if the company does everything right. Business development (where there are existing competing products or substitution products, which is the case for CCSI) at the least, knocks out the likelihood of excess premiums for returns on product investment. And CCSI has not shown a track record for more than a decade in color technology for growing business, but seems more on the track of a perpetual wannabe using OPM (other people's money). I don't have a decent estimate for the likelihood of a company in that position, but compared to new business development done properly, the likelihood of commercial success would be lower and something that a new business development professional would not advocate that their firm delve into such an area. Another rule of thumb is that in 70-90% of the cases, the first company to commercialize a new technology fails to make the premium dollars. The follow-on commercializers who did not take the product from prototype based on phenomenon to the first commercial product, are the ones most likely to make the money on the technology. Because photometry is old technology, I don't think CCSI is in the leading class in this respect. This is a page out of technology management as a formal discipline. Two more comments on CCSI's technology management--my impression of their development efforts is they were textbook--straightforward, with no apparent elegance--the 'advantage' being throwing money and people first, which is no advantage at all and the primary cause of technical product failures in the market place, when there is a significantly need to be filled by a technical product; secondly their technology management shows an absence of strategic technology management. CCSI still has a lot of company in the US in that respect, something US firms are learning to overcome from the arrogance gained in the 50's and 60's in that respect. Lacking strategic technology management leaves them blindsided to competitor and substitute technologies. The upshot being, if they can prove there is a market, those who manage technology well may take it away from them through more effective technology management methods (excellent development, technologically superior choices, better positioning in the market including the important distribution channels issue for devices like this--which are the capabilities to be found in several larger companies--even in one that I have known in the past). I believe my minor short position will pay out. There may be some spells of longs and shorts making money through trading. I am not much into timing and second guessing effects. In the long run I expect to make a significantly better return than market on average (I shoot for positions with potential to triple annually, but with 50% volatility). Best regards, m

To: JanyBlueEyes who wrote (4976)	3/22/1999 1:13:00 PM
From: JanyBlueEyes	Read Replies (1) \| Respond to of 5736

NEWS - CERTIFICATION FOR INTERNATIONAL DISTRIBUTION Chromatics Color Sciences Receives Important ISO-9001 and EN46001 Quality Certifications Supporting International Distribution of Infant Monitoring Device NEW YORK, March 22 /PRNewswire/ -- Chromatics Color Sciences International, Inc. (Nasdaq: CCSI) today announced it has received the ISO-9001 and EN46001 certifications -- signifying that the Company's New York facility meets important international quality standards for product design, development, manufacturing, servicing and distribution. The certifications, awarded by TUV CERT, the certification body of Rhelnisch-Westralischer TUV e. V., recognize the Company's established quality system for the design, development, manufacturing, servicing and distribution of its Colormate(R) TLC-BiliTest(TM) System, a transcutaneous bilirubinometer, for monitoring infant jaundice. In order to attain ISO-9001 and EN46001 certifications, a medical device company must successfully complete a third-party audit against the standards by an organization that has been accredited by a government entity in the European Union. CCSI underwent and passed such a comprehensive audit that was conducted by TUV Essen of Germany in November 1998, passed further product inspection in February 1999, and has now received its certifications. Chromatics Chief Executive Officer Darby Macfarlane commented, "We are extremely pleased to have obtained these certifications. It's a key step toward bringing our breakthrough product to doctors and babies in other countries. It also adds to customer confidence in our product here in the United States." The Company previously announced that its contract manufacturer also has an ISO-9001 and EN46001-certified facility and that the Colormate(R) TLC-Bilitest(TM) System is manufactured by the Company's contract manufacturer in accordance with ISO-9001 and EN46001 regulatory standards and the U.S. Food and Drug Administration's (FDA) Quality System Regulation (QSR), which enumerates current good manufacturing practices governing the methods used in, and the facilities and controls used for, the design, manufacture, packaging, labeling, storage, installation and servicing of finished medical devices for U.S. distribution. The device is currently being marketed and shipped to U.S. hospitals and physicians. The new certifications are a further important step in the Company's plans for international marketing and distribution of the System. ISO (International Organization for Standardization), headquartered in Geneva, Switzerland, is an internationally recognized standard-setting institution comprised of experts from over 90 countries, including the United States. The ISO-9000 series of standards addresses quality systems including quality management and quality assurance. ISO-9001 is the most comprehensive in scope of the ISO-9000 series standards. EN46001 represents additional mandatory requirements for medical devices that were promulgated by a Committee for the European Union. Macfarlane said today, "We continue to move steadily forward with our business plan. Our U.S. roll-out that began last month is proceeding as planned, with initial distribution and in-servicing of the Colormate(R) TLc-BiliTest(TM) System to hospitals and physicians. We continue to receive positive feedback from doctors and neonatal nurses using the System." The Colormate(R) TLc-BiliTest(TM) System (TLc for tender, loving care) is the only device marketed in the U.S. for pain-free, non-invasive monitoring of hyperbilirubinemia for babies of all races and all gestational ages -- even when undergoing phototherapy treatment. A study of the device published in Pediatrics, the publication of the American Academy of Pediatrics, found that Colormate(R) TLc-BiliTest(TM) System results correlate within a clinically useful range to results obtained from current invasive techniques that involve taking blood from infants -- often repeatedly. Chromatics Color Sciences is in the business of color science and has developed technologies and intellectual properties that it believes have medical applications involving monitoring of certain chromogenic diseases or disorders such as hyperbilirubinemia in newborns. The Company defines chromogenic diseases or disorders as those diagnosed or monitored by the coloration of the human skin, tissue or fluid being affected. Medical applications in addition to the monitoring of hyperbilirubinemia in newborns will require additional clinical trials and FDA clearances for commercial use. The Company's technologies and intellectual properties also have other applications including the scientific color measurement and classification of human skin and certain color-sensitive consumer products, and in determining the color compatibility of such skin and product color classification for use in a variety of industries including the cosmetic, beauty-aid and fashion industries. Certain of the matters discussed in this announcement contain forward- looking statements.......