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Biotech / Medical : Sepracor-Looks very promising -- Ignore unavailable to you. Want to Upgrade?

To: BDR who wrote (2959)	5/25/1999 2:39:00 AM
From: Asymmetric	Respond to of 10280

Morgan Stanley Analyst Reiterates Strong Buy on Sepracor (copied from Yahoo Sepracor Club Message Board. Thanks to all on this thread for all the great info. Signing on as a new shareholder. Good luck to us all. Peter) the bottom? yesterday MSDW took a stand-Strong Buy chirodok (50/M/woodside, california) May 25 1999 May 24, 1999 Morgan Stanley Analyst Reiterates Strong Buy on Sepracor In a recent note, Morgan Stanley's Douglas Lind reiterated his Strong Buy on Sepracor shares, and his earlier price target of $150 per share. Lind's take on Johnson & Johnson' s recent decision to take a royalty on norastemizole, rather than co-promote the product with Sepracor, is similar to ours: Sepracor comes out fine. Sepracor maintains all worldwide rights to norastemizole, which has done very well in trials. Moreover, development of norastemizole "remains on track," with a launch "still anticipated for late 2001." The whole hullabaloo leaves Lind's estimates unchanged; for year 2003, the analyst still expects Sepracor to post $10.90 in earnings per share. Lind's analysis of J&J is as follows: In recent months, that company appointed a new head of worldwide pharmaceuticals, replacing the individual who signed the original deal with Sepracor. The new manager, Lind thinks, is rationalizing J&J's drug portfolio, which is why the company forewent its option on norastemizole. In sum, Lind believes norastemizole "has strong commercial promise," and that "the data should dispel any concerns over the safety or efficacy of the compound." Lind says that Sepracor will conduct 4-5 more clinical trials over the next 6-12 months, including one that begins in July. While Sepracor must now pick up J&J's portion of clinical costs, probably about $12.5 million, Lind's $130 million R&D forecast for 1999 "will not change materially." Further down the road, Sepracor has to decide whether to market norastemizole on its own or to seek an additional partner. Lind sees "an attractive strategic fit" with Glaxo Wellcome Boehringer Ingelheim, or AstraZeneca, all of which have strong respiratory franchises, though lack an oral-antihistamine, such as norastemizole. Though the current uncertainty surrounding one of Sepracor's drugs in development has alienated some investors, we believe the current setback in share prices creates an attractive buying opportunity for Sepracor shares.