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Elan Corporation, plc Message Board

  • acricketeer acricketeer Mar 25, 2005 10:08 AM Flag

    JM Has KM In an Irish Headlock

    Kinda reminds me of the movie, "The Fugitive" in which the nefarious drug co. execs promote personal/company gain over care or their fellow man.
    Perhaps JM knew that the withdrawal of T would have a devastating effect on BIIB's stock. He also knew that ELN's stock would go down even more and would have a slimmer chance of recovering due to ELN's unpopularity with Wall St. and their past accounting scandal. BIIB's share price is already firming while ELN's share price is withering in stasis.
    JM knew that institutional money managers couldn't ignore BIIB's healthy balance sheet, huge cash flow and profitability. He also knew that these money managers would shy away from ELN, due to their huge debt, large burn rate, interest payments and going concern report within a few years. He probably figured that even if T did re-enter the market, after a prolonged delay, the stock would barely recover. The longer the delay, the more anemic the recovery in ELN's share price. It would be easy to using stalling tactics with the FDA, if they were responsible for marketing the drug approved in the BLA.
    Both parties also knew that T would belong to the other company, if one were taken over. They would be forced to live with each other, or merge. And merger would be KM's only option.
    While ELN lost 2/3rds of its value on Black Monday, BIIB lost about 1/3rd (approx.), so the relative carnage hit ELN disproportionately hard.
    BIIB's share price appeared to be more steady despite the fact that they were undergoing a massive investigation over stock sales in advance of the FDA report and adverse publicity on this issue in the local press. JM also knew that shorts would be more relentless against ELN than BIIB because of their weakening balance sheet and limited visibility.
    Trend analysis would suggest that BIIB's share price continues to firm more than that of ELN and the widening divergence will favor BIIB shareholders, or those involved in arbitraging the two stocks.
    As time goes on, any lengthy delays in T's re-entry only favors BIIB. It protects the Avonex franchise while several years exist on its patent estate. The cash flow and profits that feed their bottom line only make their stock currency more powerful. Meanwhile, ELN is bleeding cash. The interest payments on their debt alone swallow whatever gross profits are derived from their existing drug sales and the Prialt ramp.
    Time is on JM's side. He has KM pushed against the wall, gasping for air. At some point, he will cry uncle and hand over the crown jewels to JM. At that point, BIIB's share price will be up to 60. To JM, he doesn't care whether ELN's share price is 5, 7 or 12. What matters is the exchange ratio of ELN shares for BIIB shares. The T debacle has worked brilliantly in abetting BIIB's ruthless designs.

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    • I probably should let you rant you opinion without a whimper, but you give a good case for not owning
      Elan which, of course, is your option.

      Personally I don't believe you understand the Business relationship between Elan and BIIB or Elans Financial Structure
      or the strength of this Senior Mngt. team.

      I would contend the Tysabri WILL HAVE a bigger
      effect on Elans Fortunes than BIIB. I think Elan CONTROLS the MARKETING arena that Tysabri and its many uses will enter. You seem to forget who owns the Science and who has the pipeline these trials and future trials are coming from.

      You must think that this group doesn't have a clue how to put $1.5 Billion to work thru 2008 even without Tysabri.

      You watch too many movies, and to try and categorize the Tysabri situation to " The Fugitive" is
      just using the murder of a Drs. Wife and false drug results is a stretch. Why not use a Movie with some class ?.

      Of couse, you must consider That you assume that JM is more probable of being able to app;y "An IRISH" headlock to our "Irishman". I know for a fact that KM and his Ivy League training is a better wrestler than

      will ever be. JM seems to take vacations at a time when Business should be FIRST not SECOND.
      Would suggest tha KM is the heavyweight here, not Mr. Mullins. You might check out their backgrounds before you make judgement you can't possibly know about. Mullins may know how to put a sales operation into Europe. I'm not sure that will help him here.

      As far as BIIB and ruthless designs. I don't think they could afford to get into a legal squabble with Elan. They have much too much to lose. And as far as a buyout, that is rubbage, was rubbage and will always be rubbage.

      You could probably put me in an "Irish" headlock.
      I am a long term Investor. Liked it at $1.22 and like it better at $7.41 but I may be able to read this Financial Statement on a going concern basis, because of long term"VISION" Try it.

    • I probably should let you rant you opinion without a whimper, but you give a good case for not owning
      Elan which, of course, is your option.

      Personally I don't believe you understand the Business relationship between Elan and BIIB or Elans Financial Structure
      or the strength of this Senior Mngt. team.

      I would contend the Tysabri WILL HAVE a bigger
      effect on Elans Fortunes than BIIB. I think Elan CONTROLS the MARKETING arena that Tysabri and its many uses will enter. You seem to forget who owns the Science and who has the pipeline these trials and future trials are coming from.

      You must think that this group doesn't have a clue how to put $1.5 Billion to work thru 2008 even without Tysabri.

      You watch too many movies, and to try and categorize the Tysabri situation to " The Fugitive" is
      just using the murder of a Drs. Wife and false drug results is a stretch. Why not use a Movie with some class ?.

      Of couse, you must consider That you assume that JM is more probable of being able to app;y "An IRISH" headlock to our "Irishman". I know for a fact that KM and his Ivy League training is a better wrestler than

      will ever be. JM seems to take vacations at a time when Business should be FIRST not SECOND.
      Would suggest tha KM is the heavyweight here, not Mr. Mullins. You might check out their backgrounds before you make judgement you can't possibly know about. Mullins may know how to put a sales operation into Europe. I'm not sure that will help him here.

      As far as BIIB and ruthless designs. I don't think they could afford to get into a legal squabble with Elan. They have much too much to lose. And as far as a buyout, that is rubbage, was rubbage and will always be rubbage.

      You could probably put me in an "Irish" headlock.
      I am a long term Investor. Liked it at $1.22 and like it better at $7.41 but I may be able to read this Financial Statement on a going concern basis, because of long term"VISION" Try it.

      • 1 Reply to okz45
      • Actually, I agree with most of your points. I too am long, ELN. However, I don't think that owning the science, the patents or "controlling the marketing" is enough. It takes two to play and one party can present a roadblock. I admit that I don't know the intricacies of the agreement between the two companies.
        All JM has to do is say that he's not quite comfortable in reintroducing T until more exhaustive studies are done. He needs to comfort BIIB shareholders that they are insulated from a product liability lawsuit, which is far more onerous than a shareholder lawsuit. He couldn't give a rat's tail over ELN's fortunes. The only value of ELN to him is that they're a 50% owner of T and that's what precisely makes them so vulnerable to any predatory move. It's in his best interest to see ELN as weak as possible. Call me a snake in the grass, but I could see ELN receiving a going concern report from their auditors within 3 years if T isn't allowed back on the market.
        I truly hope that I'm wrong and that the two CEOs have a collegial if not contentious relationship. I hope that ELN has standstill agreements in place that could thwart such a hostile move and that theyir lawyers provided for these contingencies in the event of a recall/moratorium with T.
        Is is wrong for a long to pose opposing arguments at times? I thought we're mainly in this for the money. I'm long July calls and a boatload of stock and I'm hurting like the rest of you.

    • LOL

      sounds like you could write political reporting for Dan Rather

    • >>>BIIB's share price is already firming while ELN's share price is withering in stasis.

      Reality check:

      BIIB is 2.5% from its bottom

      ELN is 34% from its bottom.

      • 1 Reply to menachem10
      • Hellow, Menachem. Chag Sameach. True, BIIB is 2.5% from its bottom and ELN is 34% from its bottom. One can parse statistics either way. However, ELN had already lost nearly 72% of its original value while BIIB only lost around 35% of its value. The bigger percentage loss merely created a bigger oversold bounce. Agree that BIIB's price is really not firming -- it's more like the soft innerds of an apricot hamantashin. The important point I wanted to make is that ELN's share price suffered much more than that of BIIB. If BIIB were to make a predatory move at this point, they would be the beneficiary, irregardless of ELN's share price. It's the relative resilience to the Tysabri news that matters for each company.

    • Elan still has an ace up its sleeve

      Patent rights

 

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