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Biotech / Medical : Zonagen (zona) - good buy? -- Ignore unavailable to you. Want to Upgrade?

To: Linda Kaplan who wrote (6456)	5/4/1999 12:39:00 AM
From: Bruce Rosen	Read Replies (2) \| Respond to of 7041

<<It's not a wealthy market, of course. We do agree about that. But Schering did get it approved and did stuff a pipeline there anyway, and sales didn't ensue.>> The question is why were sales such that no re-orders were necessary? Implicit in your analysis is one basic premise: that Schering made an effort to sell Vasomax in Mexico. Your entire post, in which you talk about initial sales, royalties, return of royalties and subsequent sales, is based on the premise that Schering made an effort to sell Vasomax in Mexico. If Schering did make such an effort, there might be some merit to your conclusion that poor Vasomax sales in Mexico presaged the same in the U.S. However, if Schering did not make an effort to sell Vasomax in Mexico, your entire argument falls apart and your conclusion is flawed. My argument is based on two facts. First, as you seem to concur, Mexico is not a good potential market for Vasomax. If you and I can see that, so can Schering. What possible reason could Schering have for making any kind of serious effort to generate significant sales there? No one has answered that question since I first brought it up in February. I believe the reason for that is that there is no good reason for Schering to expend any resources in Mexico and no one can come up with one. Second, there has been no evidence of any kind of serious sales and marketing campaign in Mexico by Schering. Mexico is our southern neighbor. Given the publicity caused by Viagra, if anything had appeared in the Mexican press re Vasomax, word would have reached us by now. If Schering had made any marketing statements of any kind, word would have reached us about that too. Most anecdotal reports we have heard have been from people who tried to find Vasomax, but couldn't. I have asked before and I ask again, does anyone have any knowledge of any significant publicity generated by Schering in Mexico regarding Vasomax? Until you or others can support the premise that Schering made a serious attempt to sell Vasomax in Mexico, any conclusions you draw regarding the lack of re-orders are flawed. You can post analyses until hell freezes over, but it will be based on a faulty premise. If you or others can explain why Schering would consider Mexico a significant enough market to make a serious effort in, and/or that they did engage in the type of marketing that they will certainly engage in upon U.S. approval, then I will need to re-think my position. <<We would know if there was a good success rate, because Schering is interested in proving that. So I am sure that if the drug did well, Schering would have told everyone. The silence suggests poor performace, as does the lack of reorders>> Au contraire! Schering, from the moment they signed the deal with Zonagen, has had precious little to say about Vasomax. Zonagen management has said that Schering wants to release as little information as possible so as to give Pfizer as little ammunition as possible in the coming marketing battle. As you might remember, there was a time when Zonagen thought they could get approved before Viagra. Unfortunately, that didn't happen. The only silver lining to that is that it gives Schering the opportunity to analyze Viagra sales and prepare a campaign based on that analysis. By keeping Pfizer in the dark as much as possible, Schering may very well be able to surprise Pfizer and gain some marketing advantages. This was mentioned by Joe P. in his last conference call. Schering has consistently remained silent, sometimes to the consternation of Zonagen shareholders. You can be sure that if Schering was getting positive feedback, the last thing they would do is alert Pfizer to that at this time. <<You say they were gathering information in Mexico. I ask you what kind of information they would have been gathering? >> I have posted my theory on that. Please remember that I don't claim certainty that my hypothesis is correct. I only claim that it could be correct given the facts. There may be other explanations for what Schering has done in Mexico. I will reiterate that until you can adequately answer the two questions I asked earlier, your analysis has been based on a faulty premise and cannot be correct. Below are links to posts where I answered your question. Message 7885398 Message 7909600 Message 8872764 If I am right Linda, perhaps I am doing you and other shorts a favor by pointing this out. If you are right, perhaps you would be doing me and other longs a favor by proving your conclusions correct. To do that, you would need to address my two main points. Why would Schering care about such a poor potential market as Mexico and just what efforts have they made there? Good luck, Bruce