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OF THE WEEK:
"Right now I estimate that we
are in the second inning of an historic stock market advance,
so I recommend that conservative and aggressive investors
remain fully invested in a diversified portfolio of high-quality
stocks from my Buy List."
- Louis Navellier,
author of the Blue Chip Growth Letter, July 2003. www.BlueChipGrowth.com.
- Arresting the Silent Killer.
cancer attacks ONE OUT OF EVERY SIX MEN. If you know and
love a man over 45, this interview with Leslie Michelson,
the CEO of the Prostate Cancer Foundation, is a MUST READ.
(Investors will also gain valuable insight into cutting
edge DNA-based cancer treatments, and which companies are
well-positioned for FDA approval.) by N.Wynne Pace.
- Cancer Cocktails? Cancer Vaccines Sounds pretty gross, but will Second Generation DNA-based Treatments Cure Cancer in our Lifetime (and should you invest in them now, while the FDA is putting so many on the fast-track for approval)? By Paul Woods, President & CEO of Odyssey Advisors, LLC, www.odysseyadvisors.com 310.568.4700
- Stock Report Card: Biotech Bonanza! Biotechnology stocks are on fire this season. Is the summer sizzle for these stocks just beginning, or are they overvalued? By N.Wynne Pace
- Beware of Hot Tips and Raging Bulletin Boards. The latest rage is a mass email touting the high dividends of a handful of stock symbols. Dividends are especially lovable now that they are taxed at a lower percentage, but don't be sucked into a loser stock on the promise of dollar per month payouts.
- Dear Lonely Hearts Home-Based Business Person: Spark Up Your Life and Your Profits with Networking! By Chellie Campbell, author of The Wealthy Spirit: Daily Affirmations for Financial Stress Reduction.
- WIN Ten Ten: Summertime and the Living Is Easy Street! Will the summer rally cool off or burn right through to Christmas? Ten important facts to consider when contemplating whether or not you should trim off some of your profits now, or let them RIDE fast and furiously into the end of the year
- Put Financial Freedom on Your To-Do List! . Learn and prosper with WIN's on-line chats with CEOs, networking meetings and important corporate announcements that influence share price. Click here for the WINning schedule.
- Companies in the News
News highlights, as reported by the most respected sources in the world. Alphabetized for easy reference.
the Silent Killer.
CEO and Vice Chairman of the Prostate Cancer Foundation
the Silent Killer. Prostate cancer attacks ONE OUT OF EVERY
SIX MEN. If you know and love a man over 45, this interview
with Leslie D. Michelson,
the CEO of the Prostate Cancer Foundation, is a MUST READ.
(Investors will also gain valuable insight into cutting edge
DNA-based cancer treatments, and which companies are well-positioned
for FDA approval.) by N.Wynne Pace.
cancer is the most common non-skin cancer, yet before the
Prostate Cancer Foundation (formerly CAP Cure) was founded
in 1993, little was known, reported or researched to cure
this deadly and demeaning disease. All that is changing now,
however. New DNA-based drugs are on fast track with the FDA,
and Leslie Michelson, the CEO of the Prostate Cancer Foundation,
is more optimistic than ever. If you love a man nearing the
target risk zone of age 55, or are just interested in investing
in the biotech companies that are pioneering cutting edge
treatments, read on!
stunned by some statistics in the Prostate Cancer Foundation
literature. Outside of skin cancer, prostate cancer is the
most common non-skin cancer in America. 30,000 men die each
year from prostate cancer. Can you put that in perspective
for us? How does that statistic compare to breast cancer or
woman has a one in eight chance of getting breast cancer.
A man has a one in six chance of getting prostate cancer.
Most people don't divide those odds to make them meaningful.
The first thing I did when I got here was that I solved the
formula. Men are 33% more likely to get prostate cancer than
a woman is to get breast cancer. And it gets worse.
a one in six risk of being diagnosed, prostate cancer is actually
very, very common, isn't it? And yet we're shocked to discover
that some of the most influential, powerful men on the planet,
men like Bob Dole and Mike Milken, have had to face this disease.
Michelson--What we have is a situation in which
everybody knows how awful breast cancer is and how society
is harnessing resources to address it. Prostate cancer is
every bit as bad, and nobody knows. One of the reasons is
that it's just beginning to attack baby boomer men. A second
reason is that prostate cancer deals with male sexual function.
That's one of the few remaining taboos in society. We can
talk about breasts more easily than we talk about a penis.
The breasts are external, apparent. The prostate is within
the man's pelvis. Nobody sees it, and we're not even sure
what it does.
Well, we've just said penis in this article, and hopefully
woken up the younger crowd. Now, we'll just scare the heck
out of them. Some of the side effects of "male hormone
deprivation treatment" (MHDT), read like Man Hell—loss
of libido, impotence, hot flashes, breast growth and osteoporosis.
It's terrible. We believe that there are about a million men
who are on Male Hormone Deprivation Treatment. It's terrible.
currently. When you're diagnosed with prostate cancer, you
basically have four options. Surgery to remove the prostate.
Two forms of radiation, internal and external, or do nothing,
also known as watchful waiting. Every year 220,000 men need
to grapple with that decision. I've been in health care for
25 years now. I don't know a single circumstance, where so
many people have to make such a difficult choice with such
little useful data. It's almost impossible to design and conduct
a trial to determine which of those treatments is best for
a slow growing disease. It's very difficult to tell people
that you're going to randomize them to different treatments,
regardless of their wishes. You'd need to run the trial for
ten years to get your results, at which point, the techniques
for surgery and radiation will have improved. The things you
figure out will no longer be relevant because they have been
superceded by technology.
hate to harp on the side effects, but when the side effects
of MHDT are so undesirable, when the cure is so vile, what
could prompt any man to try that?
Every year, about 40% of men, or 70,000 men, get MHDT as a
form of treatment when their cancer returns. Because prostate
cancer feeds off the male hormones, just like breast cancer
feeds off of estrogen, these men get all of their male hormones
taken away. In some sense we are our hormones. These men have
no libido, experience impotence, and softness of tissue. A
large number get osteoporosis; 10-15% get gynecomastia, development
of small breasts. It's terrible. The longer you stay on MHDT,
the longer you're in a post-menopausal situation. Every year
30,000 men have their cancer figure out how to grow without
male hormones. In that scenario, they get chemotherapy. Although
it typically works for a while, they die from prostate cancer
chemo is a short-term fix.
yes. Fix I wouldn't use. It's a short-term delayer of the
you think men know that?
Men at large, no. Men who are on MHDT know it. Look. I'm a
health care guy. I've been doing this for 25 years. I'm quantitative
and statistical, and I had no idea. I'm usually not a good
indicator of the masses, but if it's health care data that
I don't know, that tells you that most people won't know it.
We've done market research on this. Most people have no idea--older
men, younger men, men with and without prostate cancer, women.
People want to know, and they're angry that they haven't been
told. Our market research puts the lie to the myth that men
are uninterested in their health. There's this archetypical
notion that men are insensitive to their health. This isn't
true. Our market research shows that men aged 25-35 are pretty
unconcerned about their health. They're healthy by and large.
They don't need the regular treatment and check-ups that women
need. In their 40s, however, a little switch goes off in men
and they get a strong desire to get information about this
disease. They feel that society is cheating them by not giving
them information about their diseases. We're inundated with
information about smoking, lung cancer, cardiovascular disease,
AIDS and breast cancer. But if you're a nonsmoking man, and
you're not involved in risky behavior for AIDS, the two issues
that you really need to worry about most are cardiovascular
disease and prostate cancer. The amount of public information
available for prostate cancer is trivial compared to those
a big part of your task is to get the word out.
of the things that we've done is to put together a relationship
with TBWA Chiat Day, an extraordinary ad agency. Jay Chiat
passed away last year from prostate cancer. He was a revolutionary
icon in the ad world. We approached Chiat Day about doing
a pro bono campaign for us, in honor of their founder. They're
working with us to get information about the disease out,
sot that we can harness more of society's resources to defeat
the most common non-skin cancer in America.
lost my mother to cancer when I was a child, and I always
imagined living to see the cure for cancer. It's hard to imagine
that thirty years later, in 1993, when the Prostate Cancer
Foundation was founded, research on prostate cancer barely
existed. Prostate Cancer Foundation Founder and Chairman,
Michael Milken says, "at that time, only 10% of grant
applications were approved by the government, there were few
clinical programs, no venture capital, little sharing of data
and zero public awareness." Why was prostate cancer the
"silent killer" for so many years?
had to figure that out, in order to make the prostate movement
happen. The first thing I realized was that breast cancer
attacks on average, earlier. My thesis is that when baby boomer
women were attacked by breast cancer, they responded. Baby
boomers address problems that they don't like. Women took
some of the energy of the women's movement and poured it into
the breast cancer movement. Baby boomer men are just beginning
to be attacked by the ravages of prostate cancer because it
kicks in at age 55 or 60. The leading edge of baby boomers
are just turning 55. As baby boomer men hit their target zone
for prostate cancer, the number of new cases will go from
220,000 to 300,000 within ten years. Another part of the problem
is that prostate cancer attacks later in life. It's a tricky
area in research because the disease grows so slowly. That's
good news because it takes longer to get results. It's inherently
complex. It's quite heterogeneous. The biology is difficult
to understand. There are all of those considerations. Fortunately,
with the tremendously good work the Prostate Cancer Foundation-funded
researchers have accomplished, there are a lot of resources
being devoted to finding a cure for this disease.
At the Milken Institute's Global Conference, Michael Milken
talked about the great disparity between Research & Development
and the medical care system. He was concerned about spending
so much money delivering a faulty product. In other words,
if there really isn't a viable treatment for prostate cancer,
why are we spending $100 billion each year to treat cancer
patients, and less than $3 billion trying to find a real cure?
There's no company in the world that would spend that much
money delivering a product that doesn't work, and frankly
only desperate consumers, who have no other option, would
spend that kind of money buying it. Is there hope on the horizon
for medical breakthroughs against the disease?
And it's very timely. I've been more optimistic these past
two months than ever before about the progress in finding
treatments and cures for cancer. There has been fundamental
change, and it's beginning to yield results.
ago, the basic approach to treating cancers was to feed the
body toxins that would target rapidly dividing cells. People
typically don't understand why the hair falls out and digestive
problems occur when they have chemotherapy. The reason that
happens is the chemical agents target those cells that divide
rapidly, like hair cells and the digestive tract.
some years ago, as we began to deal with the Genome, the focus
shifted to molecularly targeted or mechanism based approaches.
Rather than going after all rapidly dividing cells, scientists
now go into the cell and identify the defect in the DNA. They
then target something that only goes to that portion of the
DNA with that defect.
approach is to go to a cancerous cell that needs androgen.
There will be an androgen receptor on the wall of the cell.
The androgen receptor is as complex a shape as you can imagine,
but we now have a good image of what it looks like. People
are working on putting things into that receptor which would
prevent androgen from sliding into that slot. That's a mechanism-based
approach. If successful, it will have very few side effects.
end of the year, the FDA will have approved seven different
drugs that are molecularly targeted; 90 days ago, there were
only three on the market. That's progress. All of the work
done 50 years ago, when Watson & Crick discovered DNA,
is paying off. No human can process 30,000 genes. Computers
and sophisticated technology are used to parse and analyze
DNA to develop targeted therapies. The results are very encouraging.
has always been hope. Now there is a stronger basis for that
positive statistic is that over the last ten years prostate
cancer death rates have reduced by 30%? Was it treatment,
therapy, a change in diet? What is most responsible for that
a little hard to know all of the components that resulted
in that success. I think part of it is better screening. The
Prostate Specific Androgen (PSA) test is a marvelously sensitive
blood test that measures levels of an enzyme produced by the
prostate gland. That test is now 14 years old. We're able
to detect cancer sooner. There have been improvements in the
surgical technology and in the radiation technology, in addition
to improvements in the MHDT and chemotherapy. I can't say
that there have been any stunning breakthroughs, but there
has been incremental progress in each of those areas. The
cumulative effect is quite significant.
talk about prevention. There is an extremely high genetic
component to prostate cancer, but is there a way of lowering
the odds, through diet and exercise, for example? Do green
and red vegetables cut a man's risk? Should males cut out
red meat altogether?
have our Nutrition Abstract that we provide people. Nutritional
research is complicated. There's no question that nutrition
is a significant factor in determining one's health. What's
not as clear is what nutritional guidance is best for which
people and which disease. Diets lower in fat, higher in soy
and higher in lycopene may have a protective effect for prostate
cancer. Lycopene is most abundantly available in cooked tomato
products. It gives the reddish color to tomatoes and watermelon.
It's more biologically available if it's cooked. The data
shows that men who eat more servings of cooked tomato sauce
have a reduced instance of prostate cancer.
note: For a copy of the Nutrition Abstract, click
here or go to:
I'm assuming Italians have reduced rates of prostate cancer.
guess. The data is hard to come by.
2000, the US News & World Report reported that PSA screening
finds tumors so small that 25-33% of the men who have their
prostates removed, are getting rid of tumors that were potentially
"insignificant" and didn't pose an immediate threat.
Your statistics show that nearly every man will have prostate
cancer cells in his body if he lives long enough. Should PSA
screening come with a warning label?
early detection program needs to be carefully designed so
that you are not detecting and treating disease that would
not become clinically significant. Ovarian, breast cancer,
all of these tests require tuning. The use of the PSA similarly
requires tuning. One needs to use the test as an early detection
tool, either for people who are at high risk of the disease
due to familial disposition, or being African American or
being over the age of 50. The results need to be evaluated
carefully to make sure that if there is going to be treatment
that it will be clinically significant.
American? Is this a high risk group?
people realize the disproportionate toll prostate cancer takes
on the African American community. African Americans are 1.54
times more likely than white men to get prostate cancer, and
2.33 times more likely to die from it. Those disparities must
be the result of more than the diminished access care that
black men get. It's more than that. There has to be some genetic
predisposition. It would not be surprising to have a genetic
predisposition. Asian men have a very low rate of prostate
that be diet?
are a lot of potential explanations. One could be genetic
resistance. Another could be that incidents of the disease
are significantly under-reported. That could be a significant
factor. These kinds of conditions, where there are associations
of one's manhood, the health care statistics don't always
reflect the reality.
talk a little about biotechnology. How does the Prostate Cancer
Foundation work with biotechnology companies, like ImClone,
Millennium, Genentech, GlaxcoSmithKline, etc., to come up
with a cure?
we are after is the most expeditious path possible to better
treatments and a cure. We provide lots of grant money to academic
researchers. Although we do not provide funds to biotech or
pharmaceutical companies, we work with them to help move their
prostate cancer drugs along more rapidly. We'll provide assistance
to anyone who has a technology that has promise for defeating
mentioned seven DNA-based drugs that should be approved within
the next 90 days. Many of our readers are investors. What
companies are leading the pack of FDA expected approvals?
an article on my desk from the June 2, 2003 edition of the
Wall Street Journal. The drugs are Iressa from AstraZeneca,
Velcade from Millennium Pharmaceuticals, Avastin and Tarceva
from Genentech and OSI Pharmaceuticals and Erbitux from ImClone.
interested readers, this week's Winsider ® Report Card
features these biotechnology companies and a few more. We
all have a vested interest in the success of their efforts!
EVENT FOR WIN MEMBERS: Mr. Leslie D. Michelson will be featured
in a worldwide online chat on July 23 from 8:45-9:15 a.m.
PST. Who should tune (or type) in? Anyone who knows or loves
a man over the age of 45. Investors who are interested in
the RED HOT BIOTEC sector might also gain valuable insight.
D. Michelson is the Chief Executive Officer and Vice Chairman
of the Prostate Cancer Foundation, (formerly CaP CURE). Mr.
Michelson has over twenty-five years of health care experience,
having served as a founder, CEO, investor, advisor, and/or
director for a portfolio of entrepreneurial health care, technology
and real estate companies. After practicing law in Washington,
D.C., Mr. Michelson was recruited to become the Special Assistant
to the General Counsel of the U.S. Department of Health and
Human Services during the Carter Administration. In 1988,
he co-founded and became Chairman of the Board and CEO of
Value Health Sciences, Inc., one of the first and most profitable
disease management companies. He then co-founded and was Chairman
of the Board and co-CEO of Protocare, a provider of clinical
trials site and disease management services to the biotechnology
and pharmaceutical industries. In 1999, he co-founded and
became CEO of Acurian Inc., a firm that recruits patients
and physicians for clinical trials. Mr. Michelson received
his B.A. from The Johns Hopkins University and a J.D. from
Yale Law School.
» Cancer Cocktails?
President & CEO of Odyssey Advisors, LLC, www.odysseyadvisors.com
pretty gross, but will Second Generation DNA-based Treatments
Cure Cancer in our Lifetime (and should you invest in them
now, while the FDA is putting so many on the fast-track for
approval)? By Paul Woods, President & CEO of Odyssey Advisors,
of advances in the treatment of cancer, it remains a deadly
disease. As our population ages, cancer rates are increasing.
Many types of cancer are curable in their early stages, and
many treatments can hold cancer at bay for a period of time.
However, cancer cells have the annoying habit of mutating
and eventually overcoming treatments designed to control them.
A cure remains elusive and cancer will probably pass heart
disease in the next few years to become the leading cause
of death in America.
is a disease characterized by a breakdown of cell growth regulators.
The resulting loss of cellular growth control allows cancer
cells to proliferate rapidly. For this to occur, tumor suppressor
genes also have to fail to function. Tumor suppressors normally
inhibit the division of cells if they detect DNA damage or
defects in the cell. Cancer cells have the ability to overcome
both these genetic systems and overwhelm healthy tissues.
generation cancer chemotherapy is composed of compounds that
target and kill rapidly growing cells. Unfortunately, hair
cells, cells in the stomach lining, and bone marrow cells
also grow faster than others. The result is that most first
generation chemotherapy leaves a patient bald, sick, and with
a severely damaged immune system.
patients aren't told about first generation cancer chemotherapy
is that 20-30% of them will die from the side effects of the
drugs, not the disease. Another 25% of cancer patients are
too sick to be given these drugs. In spite of this, the current
market for these drugs is believed to be in excess of $10
billion and growing rapidly.
used by early chemotherapy is the equivalent of flooding a
building to put out a fire in a wastebasket. In contrast,
second generation drugs are designed to specifically target
cancer cells. The goal of these treatments is to eventually
make cancer a treatable disease by stabilizing a tumor and
preventing it from metastasizing. However, we're not there
cancer patients can expect to live somewhat longer with a
better quality of life. That may not sound like much, but
the market for cancer drugs will expand significantly as a
result. By eliminating the poisonous side effects, cancer
patients that are too sick to be given first generation drugs
can now be treated. In addition, keeping patients alive longer
will also expand what is already a $10 billion market. The
result is that some of these new drugs have enormous potential.
getting specific, we need to add one caveat. New drugs require
approval by the Food and Drug Administration. In the last
few decades, the amount of time required to obtain approvals
has doubled. There is new leadership at the FDA, however,
who are saying all the right things about speeding up the
drug approval process. However, predicting drug approvals
remains extraordinarily difficult. Thus, the approach I use
for my clients, is to focus on companies with drugs already
on the market.
is an overview of some of the most promising new treatments,
as well as the companies most likely to benefit if those treatments
prove to be successful.
immune system is programmed to produce antibodies when foreign
substances like viruses, bacteria, and tumors are recognized
as invaders. These invaders produce antigens and the body's
immune system in turn produces proteins that seek out these
antigens and destroy them. Monoclonal antibodies are specialized
antibodies engineered to target specific antigens produced
by tumors and attack them without harming healthy cells.
these drugs has been on the market for about 5 years. Idec
Pharmaceuticals (IDPH) and Genentech (DNA) have marketed Rituxin
for the treatment of lymphoma. It was found to be at least
as effective as first generation cancer drugs without the
poisonous side effects. This drug now produces sales of over
$1 billion and is still growing at almost 50% per year. Investors
who purchased Idec after the drug was approved have seen a
10X increase in the value of their investment.
has recently approved a slightly different version of this
type of drug. Idec Pharmaceuticals in 2002 and Corixa (CRXA)
in 2003 received approval to market a monoclonal antibody
that delivers a radioactive isotope to attack the tumors of
lymphoma patients. Since this is a complicated technology
and the drug is difficult to administer, the potential market
may be smaller. My approach to this technology is "wait
has recently announced a proposed merger with Biogen that
may produce more negatives than positives for investors. We
continue to view Genentech as the best positioned company
in this area, though the current share price is double what
it was a few months ago.
involves the formation of blood vessels to support new tissue
growth. Since cancer cells grow faster than others, they have
a constant need for new blood supplies to supply nutrients
and support this growth. Anti-angiogenesis is designed to
starve tumors of the blood necessary to support them by arresting
the growth of new blood vessels.
of 1998, the New York Times created a furor by running an
article on this technology and announcing that a cure for
cancer was imminent. EntreMed (ENMD) was featured in the article
and its stock rose 75 points the day the article appeared,
even though the company had yet to begin human trials. Once
human trials began, results were mostly disappointing. Scientists
discovered that it's very difficult to target blood vessel
growth on tumors only, and many investors dismissed this technology.
continued to press ahead, and it's fair to say the investment
community was stunned when the company announced in May 2003
that their anti-angiogenesis drug, Avastin, showed very positive
results in treating colorectal cancer. Tumors associated with
breast cancer, lung cancer, and prostate cancers also may
be susceptible to this drug. Genentech stock has nearly doubled
since this announcement. The FDA has not yet approved Avastin
and Genentech's recent rally leaves little room for disappointment.
However, if it's approved, Avastin appears to have the potential
to be used in multiple types of cancer.
growth factors are proteins secreted by various types of cells
to promote cell growth. They bind to receptors on the membrane
of cells and this process eventually leads to the cell receiving
a signal to divide. Epidermal growth factor receptors are
found on most solid tumors, and the goal of this technology
is to essentially put gum in the lock to prevent the key from
being inserted. If these receptors can be blocked, it makes
it very difficult for a tumor to grow.
of these drugs to be approved was Herceptin, a drug developed
by Genentech to specifically target receptors on metastatic
breast cancer tumors. Sales are currently over $400 million
and growing moderately. Genentech is trying to accelerate
growth for Herceptin by promoting its use in earlier stage
breast cancer, but this is not yet approved.
the drug produced by ImClone Systems, is the most notorious
drug in this group. It was granted fast track status by the
FDA for the treatment of colorectal cancer, only to have the
New Drug Application rejected in December 2001. With ImClone's
founder facing jail and his friend (Martha Stewart) facing
prosecution it's logical to conclude the company screwed up
and the drug is a scam. That's not necessarily the case.
don't know why the FDA sent Erbitux back for more human trials,
but suspect an excess of bureaucratic caution. Based on the
original data submitted to the FDA coupled with more recent
information, Erbitux appears to help 10-22% of patients with
colorectal cancer with few side effects. It is also has the
potential to be effective against other types of tumors and
will probably be approved in Europe before it is finally approved
in the U.S.
AstraZeneca (AZN) received approval in May 2003 to market
Iressa in the U.S. for the treatment of lung cancer. By becoming
the first company to market an EGFR blocker capable of targeting
several types of cancers, AstraZeneca has a good chance to
dominate this type of treatment. However, AZN is already a
very large pharmaceutical company, so the impact of a successful
drug will be lessened.
(OSIP) is also in advanced development of an EGFR blocker.
They and ImClone Systems are likely to divide the rest of
the market in a few years.
vaccines are an old idea that may finally be showing some
promise. The idea behind this treatment is to stimulate the
body's immune system to recognize a tumor as a foreign body.
Once recognized as such, the body's immune system produces
cytotoxic T-lymphocytes (CTLs) that bind specifically to cells
with antigens they recognize and kill the targeted cells.
When done, the CTLs go to more cells with these antigens and
repeat the process until no more of these can be found.
vaccines to be effective, several conditions have to be met.
First, tumor cells must have tumor-specific antigens on their
surface. Second, CTLs must be able to find these antigens.
Third, CTLs must recognize these antigens as foreign. Finally,
the immune system must be able to summon the cavalry and attack
and kill the cancer cells. A vaccine that can overcome all
these obstacles can, in theory, cure cancer.
is that different vaccines overcome each problem with varying
degrees of success. Some stumble on one hurdle, others have
a problem with the next. Until further advances are made,
it's likely that this therapy will eventually be used in conjunction
with surgery or with treatments already discussed to try and
clear the last traces of the disease or prevent cancer from
these vaccines target specific tumors and may not be a first
line treatment, the potential market is not as large as treatments
targeting several types of cancer. However, the companies
developing these vaccines have a relatively small amount of
outstanding shares, so even a drug that eventually generates
$100-500 million in revenues can have a significant impact
(DNDN) appears to be closest to the market with a vaccine
named Provenge for treating prostate cancer. A clinical trial
now underway will be used by the FDA to evaluate the drug,
and determine whether or not the drug is approved. If the
trial is successful, approval is probably several years away.
Cell Genesis (CEGE) also appears to have promising cancer
vaccine technology and may be a year behind Dendreon.
and the proteins they produce control every stage of life,
including disease. As we already discussed, cancer is the
product of a breakdown in the genetic systems designed to
control cancer. It's the result of defects in either cancer
promoting or cancer inhibiting genes. The successful completion
of the Human Genome Project and the broader understanding
of DNA opened the door to the enormous potential of gene therapy.
is a technique for the treatment of disease that entails the
manipulation or inhibition of defective genes, the replacement
of missing genes, or the direction of therapy based upon gene
detection. The goal of gene therapy is to repair the root
cause of all disease, including cancer. However, like the
college football coach said, "Potential means you ain't
done it yet."
promising technology in this area is antisense, which focuses
on overcoming diseases by preventing the proteins that cause
disease from being formed. Antisense is essentially a jamming
signal that targets the RNA that carries instructions from
DNA to the cells. Antisense creates a mirror image of the
RNA messenger that spreads disease. When injected into the
body, it is supposed to bond with the RNA and prevent it from
delivering its message to the protein building machinery.
According to one scientist, "It's like cutting the wires
from central command to the troops. All I have to know is
what gene I have to screw up."
this isn't nearly as easy as it sounds. It turns out the dummy
genetic material often does more than just snip communication
between bad genes and their deadly proteins. Many antisense
drugs have been found to negatively affect other genes and
proteins not implicated in disease. Still others have proven
ineffective in snipping the wires. Enormous potential and
drugs that have yet to demonstrate it have characterized this
therapy to date. However, that may be about to change.
Inc. (GNTA) is in advanced human trials with Genasense, a
drug that has continued to demonstrate efficacy in treating
a number of cancers. It is in advanced human trials for multiple
myeloma, leukemia, and melanoma. Based upon the success of
the drug to date, trials have been broadened to also include
kidney cancer, pancreatic cancer, and lymphoma. At present,
Genta appears to be the best-positioned company in this area
and may have an antisense drug on the market in a few years.
(ISIS) is the other dominant company in gene therapy. It has
a number of drugs in research and has partnered with several
high profile pharmaceutical and biotech partners. However,
it has yet to find a drug that demonstrates effectiveness
in advanced human trials. If it does, it has already partnered
away a big chunk of any potential profits.
oncolytic virus technology is still in its early stages. It
is not as advanced as the treatments already discussed, and
is still too early to evaluate. However, it's based upon a
very intriguing idea. Engineered oncolytic viruses are viruses
that cannot survive in healthy cells. They are designed to
be able to only survive and reproduce in cancer cells. In
cancer cells, the theory goes, they reproduce very rapidly
and cause the cell to burst. Once free, they find more cancer
cells and repeat the process until all cancer cells have been
are a handful of companies involved in this area. The leading
company appears to be Cell Genesis (CEGE). It's in early human
trials, and progress appears to be worth monitoring.
the different types of treatment discussed so far are complimentary.
Because they have limited side effects and target different
aspects of cancer, it's realistic to expect some of these
to be used together once they reach the market. The cancer
cocktail of the future may very well include monoclonal antibodies,
anti-angiogenesis, EGFR blockers, cancer vaccines, and gene
therapy. Whether or not this will result in cancer becoming
a treatable disease remains to be seen. However, cancer patients
can expect to live longer with a better quality of life.
dominant position in monoclonal antibodies, an established
drug in EGFR blockers, a potential blockbuster drug in anti-angiogenesis,
and other promising compounds in research, Genentech appears
to be the best pure play in second generation cancer treatments.
Caveats here include a high valuation relative to its current
growth rate and the historic unpredictability of the FDA when
it comes to new drug approvals.
looking for a large, well-established company with a more
reasonable valuation and some exposure to this area might
want to take a look at AstraZeneca. With annual revenues approaching
$20 billion, new drugs have to be huge to have much impact.
However, the company appears to be capable of growth in the
low double-digits if Iressa is successful.
companies appear to have very promising cancer drugs in advanced
human trials. However, once these trials end and a New Drug
Application is filed, it can take the FDA as long as 2 years
or more to make a decision. If the drug is approved, it can
take several more years to ramp up the marketing, bring the
drug to the market, and show a profit. The result is that,
even if things go well, some of these companies are 4-5 years
away from profitability. In spite of recent strength in stock
prices, this is still not a market that will pay much for
hopes and dreams.
if an investor has a small amount money set aside for a trip
to Las Vegas and decides instead to stay home and roll the
dice, there are a few companies worth considering. The best
way to invest in hopes and dreams is with a diversified group
of companies. Expect a few jackpots along the way, and hope
that only one or two fizzle out. Companies that might be considered
include OSI Pharmaceuticals, ImClone Systems, Dendreon, Cell
Genesis, and Genta.
note: the NataliePace.com does not act or operate
like a broker. We are a media and information center. This
article is intended to educate and inform individual investors,
and, thus, to give investors a competitive edge in their personal
decision-making. The publicly traded companies and/or bonds
mentioned in this article are not intended to be buy or sell
recommendations. ALWAYS do your research and/or consult an
experienced, reputable financial professional before buying
or selling any stock.
Odyssey Advisors owns shares in the following stocks mentioned
in this article: Genta.
Report Card: Biotech Bonanza!
stocks are on fire this season. Is the summer sizzle for these
stocks just beginning, or are they overvalued? By
the biotechnology stocks featured in this week's Stock Report
Card are trading near the 52-week high. Genentech has more
than doubled: up 280% off of its 52-week low, at $72.00. And
if you were one of the prescient geniuses who bought ImClone
at $5.24, you're looking at 660% gains if you cash out now.
(Remember: it's not a capital gain until you cash it in. The
share price can still go back down.)
isn't whether or not Biotechnology is hot. It is sizzling.
But, will investors and fund managers continue to buy at a
feverish pace? Will DNA-based cancer drugs benefit from a
kinder, gentler, fast-track FDA? Is there (as the Wall Street
Journal and Leslie Michelson, the CEO of the Prostate Cancer
Foundation predict) a group of four cancer drugs that may
be approved in the next few months? As we saw with ImClone
and Erbitux, strong showings in late stage testing does not
always assure FDA approval, and many investors, including
insiders, jump ship at the first sign of bad news. If you
buy high, you can lose a lot of value on an unfavorable test
result or FDA delay. On the other hand, if you get lucky and
buy in before great news, the gains can be swift and lofty!
You don't need Martha Stewart's Stock Cookbook to understand
that you don't want to get caught holding your high-priced
biotech when the FDA rejects the application. Best to look
at the biotechs, especially some of the more experimental
companies in this week's report card, as a gamble with both
high risk and high reward. The pendulum swings severely both
ways. Also note that, of the ten companies featured, only
three have positive earnings. DNA-based disease cures are
the next wave in medicine, but we are still on the cutting
edge of the industry and it's hard to tell which treatment
is going to bear out as the most effective. (See Paul Woods
article in this magazine for more information on the various
from AstraZeneca and Velcade from Millennium Pharmaceuticals
have both received approval recently, and much more swiftly
than anticipated. ImClone's Erbitux did well in European trials
and is expected to be approved there soon. The FDA application
hasn't been filed yet, but Bristol-Myers Squibb and ImClone
have met with the FDA about refiling and are continuing their
late stage testing. Avastin and Tarceva from Genentech and
OSI Pharmaceuticals have shown positive results in trials.
Dendreon Corporation (DNDN) announced results of Phase III
trials of prostate cancer vaccine at the 94th Annual Meeting
of the AA for Cancer Research on Monday, July 14, 2003. There
is certainly a lot of room for hope and optimism on the progress
of these and other drugs, and the billion-dollar revenue potential,
once they are approved and mass-marketed.
great money managers and many patient investors know, there
are often opportunities to buy into great growth at a more
reasonable price than buying in at the 52-week high. Typically,
I use the report cards to pick my favorite company in the
sector, set a target buy price and wait for my opportunity.
This "watch and wait, trading around the core" strategy
works quite well in a bear market, when there are multiple
buying and profit-taking opportunities. (I've outperformed
the market and most money managers for the last three years
using this strategy.) If we've entered an election year bonanza,
however, patience may mean missing out on a robust market
upswing. While you have to be willing to lose it all on the
horse race of a less proven drug or company (like the cancer
vaccines), balancing that risk with a more stable stock (like
Genentech, Amgen, etc.) usually means there will be some hay
left in the stable at the end of the day.
here to view this week's Report Card and pick your
winner. Be sure to check out the WIN 10 10 list below to educate
and inform your 2003 buying and selling strategies. The key
phrase may belong to Paul Woods of Odyssey Advisors who says,
"Amazing things tend to happen in election years!"
Louis Navellier, who writes The Blue Chip Growth Letter, believes
that, "Right now … we are in the second inning of an
historic stock market advance, so I recommend that conservative
and aggressive investors remain fully invested in a diversified
portfolio of high-quality stocks from my Buy List." The
economic indicators are still mixed, and, bear in mind that
earnings won't be all in until the end of July. Certainly
weak earnings will affect investor confidence, whereas robust
earnings are likely to bring even more money into Wall Street.
NOTE: To view the biotechs and pharmaceutical companies that
are on Mr. Navellier's Buy List, go to www.bluechipgrowth.com.
of Hot Tips and Raging Bulletin Boards.
of Hot Tips and Raging Bulletin Boards. The latest rage is
a mass email touting the high dividends of a handful of stock
symbols. Dividends are especially lovable now that they are
taxed at a lower percentage, but don't be sucked into a loser
stock on the promise of dollar per month payouts.
reads: "17% dividend? Is it possible? Did you know that
there is a group of stocks that have consistently paid from
15 to 20% in annual dividends? Well, the word is spreading...."
The reader is then given five symbols to choose from: PVX,
NCN, ERF, TRU, PGH.
hot tips and headlines are merely one piece of the mosaic
that makes up a company. Dividends are great, especially today,
but not if your core investment, the share price, goes down
in value. You don't want to lose money in order to receive
the small, incremental payouts of dividends. Also, beware
of any tip that includes only the symbol, without information
on the companies. How many greenies might be deceived into
buying into oil and gas companies just to get the advertised
dividends? The above companies are all oil and gas companies.
Most are Canadian-based. Most have, even upon the first glance,
problem areas that would require additional inquiry before
a reasonably informed purchase should be made.
companies carried the worst headlines of the last few years.
Remember Enron. Price-fixing. Restated earnings. Executive
and boardroom reshuffling. Bankruptcies. None of these facts
are touted in the above email. The message is simple, and
designed to lure you in. It's always best to know what dangers
lie in unknown waters! If you look around and conclude that
all is well, that's the time to dive in!
Lonely Hearts Home-Based Business Person: Spark Up Your Life
and Your Profits with Networking!
Chellie Campbell, author of The Wealthy Spirit: Daily Affirmations
for Financial Stress Reduction.
are in business for yourself and working from home, you are
likely to get lonely sometimes. You have no office cohorts,
no company cafeteria, no water-cooler or lunchroom to hang
out in and chat with folks to ease a stressful day. The evil
temptations arise then. Somehow the refrigerator door opens
of its own accord, and ice cream jumps out into your bowl
as if by magic. The television or radio clicks on (by itself)
and that talk show is just so interesting today. And look!
It's about people in home-based businesses, too, so you convince
yourself it's work-related. Or you get lost in research, i.e.,
surfing the web… Ahhh…. And where did the day go? I've been
so busy! (How come I didn't make any money?)
to this problem is to join a networking group. (Another might
be to get therapy, but that's another article.) Otherwise
known as "relationship marketing," networking at
its best is fun--meeting good friends over a good meal and
referring business to each other wherever possible. It is
a support group of like-minded business people who cheer each
other on to ever-greater successes. When everyone in the group
is focused on finding referrals for everyone else in the group,
the result is lots of business for everyone! And when you
know you're going to have your networking get-together sometime
soon, it's easier to stay focused on your work.
a member of a networking group for seventeen years. It's very
funny when I'm at a meeting and mention this fact—someone
always comes over to me, wide-eyed and asks, "So is it
working for you?" Duh.
fact is networking works, if you work it. You
can't just go to one meeting every other month, give three
people your business card, and wait for the phone to ring.
If you're in business for yourself, you have to make the phone
ring in other people's offices. The best way to make a networking
group work for you is to remember these three simple principles:
You've got to make a commitment of time and energy—pick
a group, a regular meeting schedule, and show up consistently.
People begin to develop trust in you when you are a regular
attendee of a meeting. It takes some time for this to
happen, so don't quit before you've given it a full year
of consistent effort. When people just show up a few times
and then stop coming, I refer to them as "smash &
grabbers," like the burglars who smash a window,
grab all they can in a few short minutes, and then disappear.
I want to do business with people I'm going to see again
Do a good job, honestly and with integrity. Be professional,
always return phone calls, be on time, keep your word.
If you can, join a committee, work on the board of directors
or become an officer. That will increase your visibility,
and, at the same time, people will see you are a contributor
to the success of the organization. Not only are they
going to see you next Tuesday, but they're going to see
you being a leader—big-time credibility. Look for the
opportunity to refer business to as many other people
in the group as possible. Call people and ask them what
kind of clients they are looking for. What goes around
comes around. If someone were referring a lot of business
your way, wouldn't you be on the lookout to return the
favor as soon as possible?
People do business with people they like. Not everyone
in every group is going to be your best friend, but you
can reach out, shake someone's hand, and smile. Remember
this is your opportunity to greet old friends and meet
new ones. The temptation will be strong to find a few
buddies and sit with them every meeting. Don't do it!
Pretend you are the hostess of the meeting and welcome
the newcomer into your group. Do some positive affirmations
and talk yourself up into good, friendly energy. Leave
your complaints at home. Then I'll look forward to seeing
you each Tuesday!
follow these instructions, you'll have so many new friendships,
clients, and referrals, you won't remember what loneliness
was like. And there's a side benefit—you'll make a lot of
money, too. Just remember it's not net-sit, it's not net-eat—it's
net-work! So, what are you doing next Tuesday?
Campbell is the author of The Wealthy Spirit: Daily
Affirmations for Financial Stress Reduction.
She will be speaking at the N.E.W. Entrepreneurs breakfast
meeting in Sherman Oaks, California on July 16, 2003 at 8:30
a.m. For more information, click
here or to to:
Campbell also created and teaches the Financial Stress Reduction®
Workshops, upon which her book is based, in the Los Angeles
area and throughout the country. Her free e-newsletter is
available at www.thewealthyspirit.com. Permission granted
for use by Dr.Laura.com. Click
here for a peek at Chellie's book!
Ten Ten: Summertime and the Living Is Easy Street!
the summer rally cool off or burn right through to Christmas?
Ten important facts to consider when contemplating whether
or not you should trim off some of your profits now, or let
them RIDE fast and furiously into the end of the year…
year's low occurred in October 2002. The low in 2001 was
in September. In 2000, it occurred in December. Over the
last five years, the bull run of 1999 was the only year
that didn't report a significant dip in the second half
of the year. 1998's low occurred in, as you guessed it,
Paul Woods of Odyssey Advisors notes, "Don't forget
that we have elections next year. Amazing things happen
in election years, including economic recoveries. We think
the economy will start to do better by the end of the year."
1999 was the third year of a presidential term, the all
important election year, just as 2003 is. As mentioned above,
1999 was the only year of the last five when the market
burned right on through the summer to stellar 4Q gains.
economic forecast at the Milken Institute Global Conference
in April 2003, which included many Nobel laureates in economics,
was for flat growth in the first two quarters, with 2% GDP
growth in the 3rd and 4th quarters
this year. More recently, analysts have set the growth target
higher, at up to 3.7%. Additionally, the first quarter numbers
turned in slightly better than expected, at 1.4%, partially
due to a weak dollar. None of this is stellar growth, but
consumers, who are rich in cash from their home equity refinances,
may just be sick and tired of earning low interest and ready
to gamble that the scandals of the markets are on the wane.
such as P/E and price-to-sales ratios, are, according to
Money Central's Jim Jubak, "currently overvalued."
Standard and Poor's average P/E was 32.15, as of March 2003,
and is still considered high. Will this under-reported fact
keep investors on the sidelines?
Federal Reserve has been increasing cash in the economy
at the annualized rate of about 10% recently. Liquidity
in the market is intended to increase the velocity of money,
the movement in and between markets and corporations. Consumers
with cash traditionally like to spend on both products and
investments, which could help on both ends, the corporate
bottom line and the share price.
money market mutual funds earning 1%, investors may be willing
to gamble on a rally, and pour more money into the markets.
That's been happening big-time of late.
things happen in election years. (Did we already say that?)
Feds pumped extra liquidity into the American market in
1998, after the Asian financial crisis. Many financial pundits
call this the gas that fueled the bubble of 1999 and the
burst of 2000. Could that be the case again in 2003? Will
we see a rally that extends right up to the election?
Electric cut its 2003 profit target on Friday, after 14%
drop in 2Q earnings. Target lowered 2Q forecasts. Look for
more earnings reports to be released over the next two weeks.
If the majority of companies meet or beat expectations,
the markets should react favorably. Dismal news may prompt
the opposite, however.
jumped to 3.82 million, the highest level in 20 years, on
Thursday, July 10, 2003. Most economic indicators are mixed.
Disposable income is up (due to the real estate boom), while
salaries are down. Unemployment is up, but so are productivity,
producer prices and consumer prices, after years of fears
do? There are no definitive answers in today's marketplace.
Carefully consider your strategic positioning, your tax needs
and your income goals. Consider the counsel of one of the
most quoted aphorisms on Wall Street: "Bulls make money.
Bears make money. Pigs get slaughtered!" I like to add
one more animal to the mix: "Sheep get fleeced."
Having a little contrarian in your blood. When everyone's
screaming, "Bull run," selling may save you from
getting gouged. On the other end, buying up values when everyone's
crying "depression and deflation" has created billionaires.
Today we are decidedly between those two extremes, which requires
more careful planning and strategic positioning.
» Put Financial Freedom on Your To-Do
prosper with WIN's on-line chats with CEOs, networking meetings
and important corporate announcements.
RECAP: (See below for more details on each event.)
July 16, 2003. 8:30-10:30 a.m. Sherman Oaks, CA. NEW Entrepreneurs
breakfast meeting with Chellie Campbell, author of The Wealthy
Spirit: Daily Affirmations for Financial Stress Reduction.
July 23: 8:45 - 9:15 a.m. PST. Worldwide Online Chat with the
Prostate Cancer Foundation's CEO and Vice Chairman, Leslie D.
Michelson at www.NataliePace.com.
Learn about cancer cures and the biotechs that have them in the
FDA pipeline, along with important facts about the world's 2nd
most deadly cancer.
July 24 at 7:30 p.m: Jayme Barrett, author of Feng Shui Your
Life, explains how clutter affects your finances at The Bodhi
Tree Bookstore in West Hollywood, California.
Training Camp with WIN founder, N.Wynne Pace on Wednesday, August
13, 2003 in Los Angeles, California. Nasdaq is up 42% from October's
low. Real estate housing gains have rocketed in the last three
years. If your money isn't working for you, you're missing out
on stellar gains!
Sherman Oaks, California Breakfast Meeting. Join N.E.W. for
another Great, Fun-Filled Morning of Inspiration and Information
on Wednesday, July 16, 2003, from 8:30-10:30 AM at Marie Callender's,
14743 Ventura Blvd., Sherman Oaks, CA. (818) 788-3983. Speaker:
Chellie Campbell, Author of The Wealthy Spirit: Daily Affirmations
for Financial Stress Reduction. Cost: $16-$21 advance, $19-$24
at door. For more information on Chellie, go to: www.chellie.com.
For more information on the NEW meeting, go to:
ON-LINE CHAT with the CEO of the Prostate Cancer Foundation.
One in six men will get prostate cancer! This on-line chat is
a MUST for anyone who loves men and wants to keep them healthy,
and for investors who are interested in the RED HOT BIOTEC sector!
There are lots of DNA-based drugs on the market, many of which
are in line for fast-track FDA approval. Go to www.NataliePace.com
on Wednesday, July 23, at 8:40-9:15 a.m. PST. Ask your candid
questions of Leslie D. Michelson, the CEO and Vice Chairman of
the Prostate Cancer Foundation, who has 25 years in the medical
industry. For this important chat, we are opening up our chat
room to all interested persons. Use the following passwords:
For more information
on The Prostate Cancer Foundation, go to: http://www.capcure.org/
July 24 at 7:30 p.m: Jayme Barrett, author of Feng Shui Your
Life, explains how clutter affects your finances at The Bodhi
Tree Bookstore in West Hollywood, California. She'll
also sign your book for you! 8585 Melrose Ave in West Hollywood
- West of La Cienega. For more information on Feng Shui and Jayme
Barrett, go to: http://www. Jaymebarrett.com.
*How to Enliven
Your Health and Relationships*
*How to Manifest
Your Dreams and Goals*
Training Camp with WIN founder, N.Wynne Pace on Wednesday, August
13, 2003. My money works hard for me and makes me more and
more money. Does yours? NASDAQ is up 42% since last October's
low. Real estate has rocketed in the last three years. Both of
these markets are beating the heck out of 1% money market rates.
If you're not a part of this growth, what's holding you back?
Do you think you'll ever have the extra money and time to start
investing? That's not the way life works! As Thomas Edison says,
"Vision without implementation is hallucination." Don't
dream about winning the lottery one day. Step into investments
and GAIN WHILE YOU SLEEP. N.Wynne's seminars teach you how to
step into financial freedom NOW. You'll learn to create a portfolio
with pocket change, and use tried and true recipes for success
and personal gain. Give up the excuses and get going NOW! For
more information on N.Wynne Pace, call 310.399.0497 or email info@NataliePace.com.
in the August 13th seminar NOW, call 310.478.6677 or
register online and receive $5.00 off. Go to www.learningannex.com.
Click on Los Angeles. Scroll down to August 13th. Click
on "The Women's Guide to Getting Rich Through the Stock Market,"
with N. Wynne Pace and register! (Men are welcome, too!) If you
have any problem registering, please call 310.399.0497 or email
» Companies in the News…
as reported by the most respected sources in the world. Alphabetized
for easy reference.
Corporation (BCC) announced on 7.14.03 that they were
acquiring Office Max (OMX) for $1.13 billion, in an attempt
to get out of paper products and building materials, and into
the office products retail business. The combined company is predicted
to bring in $8.3 billion in sales for Boise Cascade, which
puts it 3rd in line behind Staples (SPLS) and Office
Depot (ODP). Shares of BCC closed slightly down, at
$21.87, while OMX surged 19.8% on the news. (Reuters 7.14.03)
Company has named its fifth new CFO in four years. Don R.
Leclair, an insider, has been promoted from his prior position
of controller. The world's 2nd largest automaker has
fallen in the past few years from a sterling credit rating in
the 90s to BBB with a negative outlook. Ford has revitalization
plans that are projected to bring in profits this year of 70 cents
per share. What's the new focus? New customers and aggressive
new products. Ford brands include: Volvo, Lincoln, Jaguar, Mercury,
Land Rover, Mazda, Aston Martin and the limited edition T-Bird
convertible that was used by James Bond in Die Another Day.
As reported in past WIN e-zines, Ford also has the proud distinction
of having three out of the top thirteen Partial Zero Emissions
Vehicles, according to the EPA. Meanwhile, Ford sports one of
the highest debt/equity ratios on Wall Street at 23.62, with a
market capitalization of 21.58 billion. In the brand-building
department, Ford seems to be on track with their revitalization
plan. Time will tell how well Ford muscles its way out of debt.
(NYT 7.11.03 & Money Central)
(HLSH) is desperately trying to avoid bankruptcy, after defaulting
on payments to its many creditors. If you're one of the crazy
investors who drove the share price to double value last week,
there are a few key facts you need to know. The accounting scandal
is estimated to be above $3 billion. Dozens of restless creditors
are chomping at the bit to get past due payments resolved. It
takes only three unhappy creditors to force Health South into
involuntary bankruptcy, at which point the shares become completely
worthless. Remember, you have to find a buyer in order to sell!
On 7.14.03, the shares were down again, to $1.30, off of the $1.89
price of last week. HLSH is very risky momentum trading,
which many money managers would advise against. (NYT 7.8.03)
What do Intel,
IBM, Dell, Sony and Sharp have in common? They are all strategic
technology partners for Wayport Inc., a provider of hot
spots in airports, restaurants, hotels and other locations. Some
people have cooled on the idea of Wi-Fi, but not anyone who actually
HAS IT!! Wi-Fi is the greatest thing since the cell phone, and
if you don't have it yet, two words—GET IT!! If Wayport was a
publicly traded company, we'd be buying it as well, but, alas,
the choice to buy into Wi-Fi on Wall Street must remain with the
partners listed above. (NYT 7.14.03)
Pharmaceuticals, marker of Velcade, which just received FDA
fast-track approval for treatment of blood cancer, is having a
shake-up in the boardroom. Vaughn M. Kailian, the vice chairman,
is giving up daily responsibilities for commercial operations
and will leave by the end of the year. Kenneth Bate, CFO, will
take over Mr. Kailian's duties immediately, under the new title
of EVP. The shakeup didn't rattle investors much. Shares were
up slightly on Monday, on volume of 4.26 million shares. (NYT
7.11.03 & Money Central 7.14.03)
the #2 soft drink maker behind Coca Cola, reported a rise in 2Q
earnings to the tune of 15%, largely on sales of Frito Lay snacks
and Gatorade, and cost cuts at the Quaker Oats division. The company
reaffirmed its annual earnings outlook of $2.16 to $2.19 per share.
makers of Claritin, reported substantially reduced profits, which
are down 72% from a year ago, and a third lower than what analysts
were expecting. What's the big problem? Claritin accounted for
a third of sales in 2001 and fetched $100 a bottle. Today, sales
are eroding on competition from generics from Novartis and Wyeth.
Other competitors are expected to enter the fray after July 23,
when the exclusive generic rights of Novartis and Wyeth expire.
Schering-Plough's new CEO, Fred Hassan, is the turnaround
specialist who revived Pharmacia, but the Schering-Plough makeover
could take time and a bit of executive waste disposal. Future
drug hopes lie with Zetia, a pill that reduces cholesterol. Sales
of Zetia could promise more than $380 million annually, according
to Tony Butler, an analyst for Lehman Brothers, especially if
the drug is combined with Merck's Zocor. (NYT 7.8.03)
Hotels and Resorts Worldwide (HOT), owners of the Sheraton and
Westin chains, is selling off hotels to pay down debt. They've
already sold 12 for $300 million, which is added to another $955
million already raised from hotel sales this year. Further, $1.1
billion more is expected to be raised on the sale of six additional
hotels in the US. What's the point of getting all the cash in
a row? To pay down debt, according to CEO, Barry Sternlicht, who
may also seek out acquisition opportunities. Though real estate,
particularly property values, has rocketed this year, HOT
is off its five year high by 40%. HOT's debt/equity ratio is 1.17
on a 6.224 billion dollar market capitalization. (Bloomberg News
Fashion Company, LLC, the limited liability corporation that
owns and markets Jennifer Lopez's fragrance (Glow by J.
Lo) and clothing line is hot, hot, hot and in the seat to be acquired
by waning fashion god, Tommy Hilfiger. Why and when? Well,
in the seat doesn't always mean merger marriage. Still, since
Tommy's brother, Andy Hilfiger, is the lead investor in the company
(which is half-owned by Jennifer Lopez), and Tommy Hilfiger needs
to revive his brand, whispering between analysts and brothers
is occurring. Tommy needs a hot brand. J. Lo needs distribution
outlets. Andy may want to step out of his brother's shadow, into
his own moment in the sun. Will it spell acquisition this year?
Look to the stars, or keep your eyes on our pages! Meanwhile,
fashion veteran Denise Seegal, is the new CEO and president of
Sweetface, reporting directly to creative director, J. Lo. J.
Lo calls Ms. Seegal a "brand builder." TOM is a Hong
Kong based ADR. TOM closed on 7.14.03 at $10.30. With annual sales
of $1.89 billion and negative income of -$83.60 million, this
mega-brand is still waiting to become the turnaround story of
the century. Sweetface is a privately held corporation that has
only been around for a year. (NYT 6.14.03)
is buying Overture for $1.63 billion in cash and stock
in a bid to outplay Google. Google, which is speculated
to become the fairy tale IPO of this year, beats out both Overture
and Yahoo in searches and paid searches on-line. The combined
Yahoo force should be a worthy challenger, however. Yahoo closed
up slightly on the news, at $32.20, prompting MSN to question
whether it might be overvalued. The cash cost of the acquisition
is estimated to be $317 million. Reuters reports that Yahoo's
cash on hand as of the latest quarter was $1.08 billion. Other
tech search engine stocks rose on rumors of more acquisition mania,
namely: Look Smart (LOOK), Findwhat (FWHT), Info Space (INSP)
and Ask Jeeves (ASKJ). (Reuters 7.14.03)
In other news,
J. Lo fired her manager, Benny Medina, and a bunch of media moguls
met in Idaho to ride bikes and relax before the Vivendi Universal
feeding frenzy and gladiator matches. It's all speculation how
the numbers will play out, so stay tuned into future WIN e-zines.
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