LUX ET VERITAS

Mike Myler: ‘I took Latin 40 years and thousands of beers ago. With the amount of reading you assign it is not fair to add Latin homework.

☞ Light is truth? At least it wasn’t French! That drives me crazy when I am reading a book and all of a sudden there is a phrase in, usually, the French language and I have no idea what it means.’Light and Truth. It’s Yale’s motto. W. is Yale ’68. He tells you we don’t torture, you can take it to the bank. He tells you ‘by far the vast majority’ of his tax cut’s going to people ‘at the bottom end of the economic ladder,’ you can be darn sure that’s where it’s going. He tells you he did not trade his Harken Oil stock with the benefit of inside information, you need not give it another thought. Yellow cake from Niger? The kind of solid deal you can put straight into the State of the Union.

(‘The Iraqi informant’s German handlers say they had told U.S. officials that his information was ‘not proven,’ and were shocked when President Bush and Colin L. Powell used it in key prewar speeches.’ – yet one more story on how the war was sold.)

I’M NOT LEEESTENING

Who was that on Saturday Night Live who used to stick his fingers in his ears, close his eyes, tilt his head down, and say that? ‘I’m not leeestening!’ Was it Billy Crystal?

Mary Mapes’ Truth and Duty is her account of the ’60 Minutes’ story she and Dan Rather did on President Bush’s service in the Texas Air National Guard. The one that got her fired even though, well, actually, it was true. It gets only 2.5 stars on Amazon, in part because of reviews like this one Sunday:

Arthur F. McVarish (Houston, TX USA)
I had/have no intention of more than scanning Mary Mapes’ whining, self-serving pile of dreck. The title of her less than Augustinian ‘Confession’ is offensive in continued pretense that she … Dan Rather& Co … does not comprise part of a Media cabal that hates President Bush and will resort to any means to destroy him …

Mr. McVarish hasn’t read it, but take his word for it (he’s an Amazon Top 500 Reviewer, after all) – it’s terrible.

NTMD

For the week ended November 4, Wall Street reports that 818 BiDil prescriptions were written, up from 672 the week before.

This number has been steadily building since August. By now, the prescriptions that were written in August and September are presumably being refilled, adding to the total. It’s like a snowball! So let’s say it keeps building and building and eventually gets to 2,500 scrips a week. At $1.80 a pill and 90 pills per scrip, times 52 weeks, that would be annual sales of $21 million – versus projected expenses of $120 million.

Or triple that, and say the weekly scrips climb to 7,500! That’s $63 million in sales versus $120 million in expenses.

But what indication is there that sales are taking off and ever would get to 7,500 a week (thereby for the company to lose only $50 million or $60 million)? The long-term proposition – that you can sell a pill made up of two generic components for six times the cost of the generics purchased separately – seems unpersuasive.

I know BiDil is not like a movie opening, where half the gross is expected in the first weekend. But if this is a must-have, life-saving drug for vast numbers of people, with 200 professionals out selling it every day, wouldn’t the upward slope in prescriptions be steeper?

Especially when you consider (forgive my ‘burying the lead,’ but it was for dramatic effect) that prescriptions for the week ended November 11 fell to 751. Even with the snowballing effect of refills.

Sales are thus now ‘quarterizing’ (to borrow one of the Wall Street analysts’ verbs) at around $1.5 million, against quarterized expenses of around $30 million, for a quarterized loss of about $28.5 million.

The stock closed at $17.57, giving the company a market cap just north of $500 million.

When Jim Cramer told his viewers to buy NTMD, he based it in part on prescriptions having jumped from ’50 to 70′ a day to more like ‘300 to 400’ a day. Well, last week’s sales averaged 107 prescriptions a day, not 300 or 400.*

And he based his buy recommendation in part on an estimate of $637 million in 2008 revenues, way higher than the $200 million to $250 million he said Wall Street was expecting. But as noted here a few days back, it’s likely the math in that $637 million estimate he cited was off by 80%. It was based on the full universe of African Americans with congestive heart failure, not the 20% whose condition had progressed to the point that the same firm, in an earlier report, had estimated BiDil would potentially be prescribed. So that would be $127 million, not $637 million. In which case sales, if they ever somehow did get that high in 2008, would be significantly below Wall Street expectations.

Don’t sell your puts. At some point, the mutual funds and others who own this stock may decide that the risk here outweighs the potential reward.

BOREF

Borealis stock jumped 10% or so yesterday – on a volume of 355 shares. I know cabdrivers who could have accounted for that entire volume. (Not a fleet of cabdrivers, mind you – one cabdriver.) Point being: nothing happened. And nothing much will, except maybe the stock will drift down as people lose patience, until something does happen – if something ever does – at which point the stock could shoot up to the next plateau. No one seems as excited about this company’s prospects as I am (well, maybe this one putative cabdriver). But unlike Nitromed, that has a pill comprised of two generic components widely available at one-sixth the price – yet commands a $500 million market cap – this crazy speculation has an electric motor the size of a watermelon that managed to drive a jumbojet around the tarmac as if it were a golf cart. (And thus, as I have noted, ought to be able to power golf carts someday, too – and maybe even cars, trucks, forklifts, and elevators.) Yet this speculation sells at a market cap of around $75 million. Paintings have sold for more.

 

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