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Biotech / Medical : SIBIA Neurosciences (SIBI) -- Ignore unavailable to you. Want to Upgrade?

To: scaram(o)uche who wrote (473)	8/2/1999 2:14:00 PM
From: Biomaven	Read Replies (2) \| Respond to of 579

So..... the AGPH, SUGN and SIBI club..... Tommysdad, pants up today Rick H. who else? I had smallish amounts in all three, as well as something in NXTR and a smidge left in CNTO at the end. Peter

To: scaram(o)uche who wrote (473)	8/3/1999 12:29:00 AM
From: tommysdad	Read Replies (2) \| Respond to of 579

What's intriguing to me is: Why SIBI? Why MRK? Merck's first big biotech acquisition is: a dinky little CNS company in La Jolla. Huh, what? A couple of ideas: MRK is looking to open a facility in San Diego (Novartis, JNJ, and WLA all have one at this point) and this is a cheap way to do it. Who's next, and who would they buy? MRK was "infringing" the SIBI patent and found one or more blockbuster drugs doing so. Buying the company outright was judged to be cheaper than paying royalties down the line. What other potential sleeper patents are out there? SIBI pitched one of their programs/advanced compounds that impressed MRK so much they bought the company outright. But those are usually pretty public (see: SUGN & AGPH). PeterSuzman suggested MRK/SIBI in March. What was the hook, Peter? Maybe this belongs on the Munch thread, but this thread will be history soon anyway. Kind of OT: Any guesses how many Merck/Rahway employees are going to be interested in becoming Merck/La Jolla employees?

To: scaram(o)uche who wrote (473)	8/3/1999 4:28:00 PM
From: RCMac	Respond to of 579

>>. the AGPH, SUGN and SIBI club.....<< Member in good standing - thanks to Rick, MZ and (on AGPH) margie -- although with pretty small positions in each. (My big biotech positions are, in order, SEPR, GLIA, CORR, INCY; I have nibbles at a bunch of other stuff, most of it things that Rick or MZ or Peter and/or V1 have articulated enthusiasm for, and a few other things.) Also, disappointed we didn't get a lot more for these three, especially SUGN and SIBI, but it's sort of unseemly for me to be too grumpy about 120%, 30% and 60% gains (in about six, three and two months), where others did the real work and this nonscientist investor just had to pay attention and listen carefully, and do my own DD as far as possible - again, thanks Rick, MZ and margie. So, on to the next one - maybe at these prices even more GLIA? BTW, re GLIA, an exercise suggested by the recent discussion of valuation on the Munch thread, starting at Message 10707142 , and continued on the Biotech Valuation thread Message 10711099 : If you adjust GLIA's earnings statement by adding back GLIA's $3.4 million R&D (i.e., if you capitalize it rather than expense it), you come up with a PE of about 11 for GLIA at current prices. If you expense only half the R&D (i.e., you assume that half the research spending is an investment toward future earnings, and half is wasted) you still get a PE of about 18. And this is on earnings from only Adcon-L, addressing a market of 400-450,000 surgeries annually, and not yet from (1) the five other Adcons in the pipe (two in Ph3) addressing a market of about 7,000,000 U.S. surgeries annually Message 7671563 , or (2) the several other programs deeper in the pipeline (histamine H3 receptors, complement cascade inflammation, etc.). This does seem silly cheap. --RCM