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SciClone Pharmaceuticals, Inc. Message Board

  • vodka_voltage vodka_voltage Jan 26, 2013 11:14 AM Flag

    new distribution deal china..sinopharm?

    hey, isnt this good news? can someone say

    Sentiment: Strong Buy

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    • No, it's bad news. The agreement was signed on the 18th, then SciClone waited a full week to file notice of the agreement (as required) with the SEC at 4:30 on Friday afternoon and, of course, no press release about it. Sound like good news to you? I guess Friedhelm thinks a press release about a new counterfeit-proof vial is what shareholders really want to know about!

      Sinopharm was probably one of the company's distributors that SciClone bagged with its channel stuffing described in the November Q3 announcement. Looks like Sinopharm took Friedhelm and Gary out for a spanking and jammed the exclusivity agreement down their throats. No payment for exclusivity-no favorable pricing (the pricing mentioned in the Nov. announcement is the same that SciClone announced in September that ALL of its major importers had given SciClone)-and volumes will be "agreed to" meaning Sinopharm won't be buying any more than SciClone's sales force can sell. Bye-bye channel stuffing. This is how Sinopharm will discipline SciClone.

      Biggest factor at risk is the future price the now one and only importer will pay for Zadaxin. Since the beginning of 2007 the yuan has appreciated by 24% against the US $ and SciClone has benefited by gradually increasing the $ price for Zadaxin over the years. That's responsible for a big chunk of the revenue growth and even more for the profitability (and we thought it was management!). Now SciClone no longer will determine the price the distributor pays. We don't know what the agreement says, but we can bet that Sinopharm is driving the bus on this issue as well.

      It's not a total loss. Some did well. While consistently overselling Zadaxin throughout the first nine months of 2012, knowing that SciClone's sales force was actually selling significantly less to the hospitals, Friedhelm and Gary pumped the Zadaxin growth story and in June sold at $7 for a million dollar profit. Now it looks like there was no growth in 2012 for Zadaxin sales. Too bad shareholders didn't know about it before November.

    • My posts today are all screwed up. Please look under my Yahoo won't let you cut... post.
      The govt is mandating new distribution deals. This agreement could expand the market of Z especially in a SARS like environment.

 
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