upgrade from abn amro, page-9

Abobo

I do not entirely disagree with what you say. More how you say it i guess (re semantics post).

Yes analysts figures could and should be disputed. The sporadic nature of the royalty stream and the fact that even BTA do not know how much royalty income they will receive until notified by GSK would seem to provide doubt on the accuracy of the analysts figures.

Your comment:

'What do the figures show? A fast shrinking pandemic stockpiling market!! What is $4.4M per quarter to $220Mper quarter - shrunk to 2% of its peak!!'

I do not know what you are comparing March 08 royalty of $4.4m to $220m per quarter of ?????

Lets not look at on quarter - the last in isolation.

Mar 08 quarter $4.4m is higher than June 06 at $3.4m. Dec 07 at $12m is higher than Dec 06 at $6.3m. As your figures show Dec 07 is the second highest roylaty number. Only six months ago.

Agin i say when GSK were looking to commence a trial this month why would they want to present a good June quarter number. They would want to show a decline. Lets see what next quarter shows. Whilst we would all agree the sales are in decline due to stockpiles already achieved the product (Relenza) at this point in time is not dead and is still in play when eminent world scientists are calling for it to make up a greater proportion (some suggesting up to 50%) of pandemic stockpiles.

Your comment:

'Tamiflu sales in the past 12 months shrunk to a fraction of 10% of the peak showing very clearly the pandemic bonanza has gone!'

Correct in the sense that pandemic stockpiling for the moment may have been near filled and bird flu cases have decreased. However, you fail to mention that Tamiflu may sales may be decreasing due to negative sentiment eminating from the scientific and medical profession. Coupled with this negative sentiment the fact that most stockpiling bodies had topped out on Tamiflu anyway without consideration to medical and scientific facts.

These issues do not mean the pandemic bonanza has gone - altogether. It is cyclical, i.e. expiry dates, increase in bird flu cases, further scientific research on the effectiveness on one product over another, Etc.


Your comment:

'Peter Cook steadfastly turned down the $100M settlement offer,'

If you were seeking $300 - $400 million in damages and the defending party came to you offering $100m would you not think you had them on the back foot? Especially if you trusted your legal advice that you had a strong case. Hindsight is a wonderful thing. And the royalties since 2006 whilst steady (not including the last quarter 2008) confirm a strong (or the appearance of) case remained beyond 2006.


Your comment:

"Yes, the GSK “long standing relationship” was to tell potential clients Relenza was ineffective and in fact out right dangerous. (Read GSK’s reply to BTA’s claims for full details)."

Your opinion here would appear contrary to learned scientific advise and research that Relenza is appearing a superior product to its direct market competitor. Re 'outright dangerous' - this is what the Japanese are suggesting about the competitors product is it not.

Lets see what happens now the settlement has happened and what is said. Should a comment made in the 'heat of battle' by an opponent be takeen at face value as true and factual?

And yes analysts should justify their figures.

Have you confirmed your advice re the legal damages claim and the position of recoupment of royalties / income stream?

cheers