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To: bw who wrote (8103)	4/10/1999 10:54:00 AM
From: Thean	Respond to of 14427

bw, I look at DRMD and its Cenestin approval this way: now DRMD has a chance to take a piece of the pie of this still growing (15% annual growth) market currently worth $2MMM. Make no mistake - this is a crowded market with many players and Cenestin definitely not a first-in-class drug (that would easily be worth 200MM right away). But a 5% stake of a $2MMM market is $100MM. DRMD's current annual revenue is $50MM. This is a tripling of revenue for a small company like DRMD if they can capture that 5%. Competing on the generic space net them $50MM. Now with an NDA drug they have a chance to break through their revenue ceiling because now their business has dramatically changed, kind of like moving from the minor league to the major league because now you have something to prove (but so do others). Note that DRMD's Cenestin is only indicated for short-term "moderate-to-severe vasomotor symptoms associated with the menopause.", not long-term treatment of osteoporosis. In layman's term, they can only capture the symptom treatment space of the menopause market. But be aware, there are plenty of reasons for doctors not to prescribe estrogen products for long-term treatment of osteoporosis, chief among them increased risk of cancer and the symptoms of menopause (the exact opposite of the short term benefit of Cenestin). Estrogen in combination with progesteron products (combi therapy) has shown to reduce that risk substantially - so there are also plenty of players working on/selling the combi therapy. But the main point is now there are drugs (Fosamax by MRK, EVISTA by LLY, and other major companies very soon to come into the market) that are indicted for the long-term treatment of osteoporosis without the side effects of estrogen related risk. The osteoporosis market share for Estrogen products and combi therapy will go down (but net market volume is a different thing because the whole category is still growing). Net, Cenestin can do very well in its space competing with others especially if its marketing is done right. Its growth will be driven very much by its marketing strategy, not the science as this is not a break-through science. I think your question about any clinical advantages of Cenestin versus competitors is a logical one. However, it is quite irrevelent in the grand scheme of things. DRMD is a relatively small company. It currently does not have the resource to pursue novel, breakthrough development of drugs like Forsamax and Evista. FDA's q&a regarding Cenestin: fda.gov