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*DJ GTC Biotherapeutics Is Unaware Of Any Reason For Unusual Trading Activity>GTCB
Just out... I just bought some shares back.
GTCB
I'm glad to know I sold my shares to someone like you Randy. I'm so pissed that I got squeezed out today. I've never seen a company manipulated this bad (40% fall on huge volume on no news, financing, etc.)... Absolutely amazing. Current GTCB share holdings zero, current broken computer monitors 1.
I wish everyone long GTCB the best of luck. Shouldn't the SEC look into manipulations like this? Oh well, I'll go buy some income / dividend paying ETF's. Anyone know of some?
10nis
gtcb - Down 8%. 1.80 - Anyone hear anything.
I bought on yesterday's dip. So, this was expected on my end. I haven't heard anything, however, it looks like a large shareholder wants to get out of some or all of its position. Dew - is that you shaking the weak longs out?
Take care,
10nis
GTCB
Only 1.8 million shares were traded yesterday so I don't know what 4 million share dump you are talking about. IMO, weak holders of the company will get out of the way this week and GTCB will move up next week prior to the announcement.
Anyone else have any ideas?
PFE - Pfizer (Strategic Alternatives)
http://biz.yahoo.com/prnews/060207/nytu207.html?.v=21
Press Release Source: Pfizer Inc
Pfizer to Explore Strategic Alternatives for Consumer Healthcare Business
Tuesday February 7, 5:35 pm ET
NEW YORK, Feb. 7 /PRNewswire-FirstCall/ -- In response to media inquiries ahead of the company's February 10 meeting with financial analysts, Pfizer Inc said today it will be exploring strategic alternatives for Pfizer Consumer Healthcare (PCH). These alternatives include retaining, spinning off or selling the business.
The objective of the review is to unlock the value of the business for Pfizer shareholders at a time when market valuations are attractive for large, high-quality consumer businesses. PCH is a leading global consumer healthcare business with a portfolio of well-known, growing brands.
Pfizer said that the welfare of PCH colleagues and other Pfizer colleagues supporting the business will remain a high priority throughout the process, consistent with our long-standing values and respect for colleagues throughout the company.
At the February 10 meeting, Pfizer will provide a comprehensive overview of its business and financial strategy, including key products and its industry-leading pipeline, as well as further elaborate on this strategic initiative.
--------------------------------------------------------------------------------
Source: Pfizer Inc
PFE....
http://yahoo.reuters.com/financeQuoteCompanyNewsArticle.jhtml?duid=mtfh65828_2006-01-26_20-15-42_n26...
UPDATE 1-US FDA approves Pfizer drug for two cancers
Thu Jan 26, 2006 03:15 PM ET
(Recasts with FDA approval)
By Ransdell Pierson and Lisa Richwine
NEW YORK/WASHINGTON, Jan 26 (Reuters) - Pfizer Inc. (PFE.N: Quote, Profile, Research) won U.S. approval for its drug Sutent for fighting two hard-to-treat cancers of the kidney and stomach, U.S. regulators said on Thursday.
The Food and Drug Administration said it cleared Sutent for treating patients with advanced kidney cancer or a rare stomach cancer known as GIST.
"Today's approval is a major step forward in making breakthrough treatments available for patients with rare and difficult-to-treat forms of cancer," Dr. Steven Galson, director of the FDA's Center for Drug Evaluation and Research, said in a statement.
Sutent, or sunitinib, is a once-daily capsule that blocks several enzymes known as kinases that allow cancer cells to multiply.
Earlier Thursday, researchers reported that Sutent slowed growth of stomach cancer and significantly prolonged the lives of patients who had developed resistance to Novartis AG's (NOVN.VX: Quote, Profile, Research) Gleevec pill.
"(Sutent) is the first molecularly targeted therapy proven to work against a cancer after another targeted therapy has failed," said Dr. George Demetri, the study's lead investigator.
Risk of death among stomach cancer patients taking Sutent was less than half that of patients in the trial taking placebos. And cancer among the average patient taking Sutent did not progress for 27.3 weeks, more than four times longer than the 6.4-week average for the placebo group.
All 312 patients enrolled in the trial had stomach cancer that had spread to other parts of the body or that could not be removed through surgery. Moreover, all patients had previously taken Gleevec, but no longer benefited from it.
Two-thirds of the participants received Sutent, while remaining patients took placebos.
Patients in cancer trials typically do not get just placebos because it is considered unethical to deny them effective treatments. But they received placebos in this trial because no standard drug is known to work against such stomach tumors once they develop resistance to Gleevec.
Demetri, associate professor at Harvard Medical School, said the study was highly significant because of the improved survival shown for Sutent. He presented the findings at the annual Gastrointestinal Cancers Symposium in San Francisco.
When it became clear that patients taking Sutent were surviving longer than the placebo group, all patients in the study were allowed to start taking the Pfizer drug. The trial is continuing.
Pfizer, which acquired Sutent in 2003 through its purchase of Pharmacia Corp., has said it intends to become a major player in the oncology arena. It is now far better known for drugs such as Viagra and cholesterol fighter Lipitor.
IMCL
Everything is debatable. We just had one analyst this week raise IMCL's target price to $48 or so. You have the same things going on with GOOG ($2,000 target price to $100 target price - I'll take any where in the middle).
In addition, what valuation mechanism did the analyst use to determine that IMCL is 38% overvalued? Is this based on EPS? DFCF's? Or some other valuation technique? Does this analyst have other more lucrative reasons for saying that IMCL is overvalued by 38% at this time? Possibly and probably. This is JMHO.
IMCL - Buyout/Buy a company....
Why would IMCL engage Lazard if they were going to buy a company? I don't think IMCL would waste time and funds hiring a firm like Lazard in order to look at possible purchases. I think there's a much higher probability that IMCL sells itself vs. buys another company.
If IMCL were to buy a company..... who and why?
imcl - Why put yourself up for sale at this point when the completion of these trials is so close? Why not wait?
My opinion is Risk/Return. If IMCL can cash in at say a 38% premium over the current market price or about $47 regardless of risk of the trial data why not sell? Its similar to GTCB selling shares ahead of approval. I think IMCL will try and get a nice takeout package, lock in some nice capital gains for its employees and executives, and it gives them the opportunity to advance its current and future trials with nearly endless capital. Big pharma needs a pipeline so why not sell out?
Dew, what are your thoughts?
IMCL Buyout...
Dew,
Do you still think a $50/+ take-offer price is in the cards or would IMCL be willing to sell for mid to upper $40's? What is your probability that an announcement is made in the first half of the year?
Thanks,
10nis
Mad Cow Companies....
Does anyone have a list of companies that have mad cow drugs that they could post?
TIA,
10nis
TEVA
Kramer just said BUY, BUY, BUY!!! He spoke about it for a good 5 mintues and said its going higher!! I say, SELL, SELL, SELL!!
Take care,
10nis
IMCL - Break out or Buy out?
Some solid volume with this latest move. Merger Monday? Anyone in the know?
Hope everyone has a wonderful weekend,
10nis
Year-end Tease:
Dew, when do you think you'll be done with your buying? I just want to make sure I have some cash ready to buy some whatever it is when your done. Thank you for your postings, responses and recommendations throughout 2005!!
Have a healthy and prosperous 2006,
10nis
OT
Does anyone know how to buy (Volatility or the VIX)? I thought it was possible to buy it via an index fund just like you can buy the TIPS or Gold, however, I cannot find a symbol for it.
TIA,
10nis
IMCL
IMCL just hit $35 today. Does anyone know why BMY cannot acquire a controlling stake in IMCL in excess of 19.9% prior to September 19, 2006? Is it a contractual thing or a tax free transacation thing?
Thanks in advance,
10nis
10. Will ImClone be acquired? Amgen's proposed acquisition of its partner, Abgenix, has increased speculation that Bristol-Myers Squibb (BMY), ImClone's partner on Erbitux, may acquire ImClone. Based on the agreement on Erbitux, BMY is not allowed to acquire a controlling stake in Imclone in excess of 19.9% prior to September 19, 2006, subject to certain exceptions. As of 3/15/05, BMY holds the original 14.4MM shares acquired in 10/01, or 17.2% of shares outstanding. If ImClone were acquired by a third party, we believe terms on the Erbitux agreement will stand, that is, BMY will continue to pay royalties on net sales in North America of 39%. BMY also reimburses ImClone for a portion of royalty fees that ImClone pays to third parties based on North American sales. The agreement also stipulates that BMY pays 100% of the cost of Phase 1-3 clinical trials in North America. Phase 4 trial expenses are shared equally.
Coinstarz,
What is your short and long term target price for INSM?
Dew,
What do you think PFE is worth based on the Lipitor patent news and the increased dividend? $30? $35? Have a great weekend.
TIA,
10nis
I own WEDX - Westaim, who is spinning off Nucryst. Westaim is an intersting company that owns iFire - a company that has developed a technology to produce 35-40 inch flat screen TV's at half the production cost and better picture quality (TV life, picture color, etc.) than competing flat screen technologys (Plasma and LCD's.)
I would love to hear everyone's opinion on the WEDX and Nucryst.
TIA,
10nis
OT - OVTI
Congrats on OVTI - I'm a holder of OmniVision as well. Let me know if you find any other companies that remind you of it (great cash flow, zero or low debt, and in a fast growing business).
10nis
AXYX - Who would partner with this company?
Press Release Source: Axonyx Inc.
Axonyx Reports Statistically Significant Result for Phenserine in Alzheimer's Disease
Tuesday November 29, 8:30 am ET
Additional Analysis Results from Curtailed Phase III Clinical Trials
NEW YORK--(BUSINESS WIRE)--Nov. 29, 2005--Axonyx Inc. (NASDAQ: AXYX - News) reports today the results of an additional analysis of a subgroup of patients from its two curtailed Phase III clinical trials (AX-CL-09/010) with Phenserine, in development for mild to moderate Alzheimer's disease (AD). The subgroup of patients, who received Phenserine 15mg twice daily, demonstrated a statistically significant benefit over placebo as measured by the Alzheimer's Disease Assessment Scale-cognitive subscale (ADAS-cog), when treated for more than 12 weeks. Additionally, this subgroup showed a positive trend towards improvement in the Clinical Interview Based Impression of Change (CIBIC+) test, which approached statistical significance. There were no unexpected safety or tolerability concerns associated with Phenserine treatment. This analysis was undertaken in addition to the previously announced results of the primary pre-defined statistical analysis.
While additional clinical trials would be required to further confirm the results of this additional analysis, the Company believes that they support its stated position that higher doses of Phenserine could potentially be efficacious in treating the signs and symptoms of mild to moderate AD in future potential Phase III trials of 26 weeks duration.
On September 20, 2005, the Company announced the top line results from its primary efficacy analysis of all patients that participated in the curtailed Phase III clinical trials; this analysis did not demonstrate a statistically significant benefit associated with Phenserine over placebo after 12 weeks of treatment in either the ADAS-cog or CIBIC+, the primary efficacy endpoints for the study. At that time, the Company indicated that it would continue to evaluate the Phenserine program. On November 7, 2005, the Company indicated it would not commit further resources to the development of Phenserine and would seek a partner for the compound.
This additional analysis was recently completed as part of the program to identify a partner for the further development of Phenserine. The analysis included 182 patients who received Phenserine treatment or placebo for more than 12 weeks and up to 26 weeks of treatment. The statistically significant benefit was based on the ADAS-cog test; one of the FDA approved measurements of efficacy in Alzheimer's disease clinical trials. The improvement in the CIBIC+ test, another approved efficacy endpoint, for the 15mg twice daily group approached statistical significance compared to the placebo group. The patients who received Phenserine 10mg twice daily did not show a statistically significant benefit compared to placebo.
Details of the secondary analysis results are provided in the chart below. For the ADAS-cog, more negative values indicate greater improvement of cognition. For CIBIC+ lower values indicate greater improvement.
Mean Changes from Baseline to Last Visit in the Post Week 12 Patient
Subgroup
----------------------------------------------------------------------
15-mg Mean Difference
Endpoint Twice Daily Placebo 15mg vs. Placebo P - value(c)
n = 54 n = 66 (+/-95% Confidence Intervals)
----------------------------------------------------------------------
ADAS-cog(a) -3.18 -0.66 -2.52 (-4.92 to -0.12) 0.0296
----------------------------------------------------------------------
CIBIC+(b) 3.59 3.95 -0.36 (-0.76 to 0.04) 0.0568
----------------------------------------------------------------------
a) Ranked ANCOVA model with centre and baseline covariates.
b) Cochran-Mantel-Haenzsel test incorporating rank scores.
c) Statistical significance is defined as a P value of 0.05 or
less.
Phenserine is a highly selective acetylcholinesterase inhibitor (AChE-I) that breaks down a neurotransmitter in the brain important in memory and cognition. Unlike other AChE-I's which only suppress the activity of the enzyme, Phenserine has been shown to have two mechanisms of action: (1) the inhibition of the AChE enzyme, and (2) in preclinical studies the inhibition of the synthesis of A beta, the protein in the brain that is thought by many to be a potential cause of Alzheimer's disease and its progression.
About Axonyx
Axonyx Inc. is a U.S.-based biopharmaceutical company engaged in the acquisition and development of proprietary pharmaceutical compounds for the treatment of Central Nervous System disorders. The Company currently has three compounds in development for Alzheimer's disease, namely Phenserine - a potential symptomatic and disease progression treatment of mild to moderate Alzheimer's Disease (AD), Posiphen(TM) - a potential disease progression treatment for AD now in Phase I, and BisNorCymcerine (BNC) - a potential symptomatic treatment of severe AD now in pre-Investigational New Drug (IND) stage.
This press release may contain forward-looking statements or predictions. These statements represent our judgment to date, and are subject to risks and uncertainties that could materially affect the Company, including those risks and uncertainties described in the documents Axonyx files from time to time with the SEC, specifically Axonyx's annual report on Form 10-K. Specifically, with respect to our drug candidates Phenserine, Posiphen(TM) and BisNorCymcerine, Axonyx cannot assure that: any preclinical studies or clinical trials, whether ongoing or conducted in the future, will prove successful, and if successful, that the results can be replicated; safety and efficacy profiles of any of its drug candidates will be established, or if established, will remain the same, be better or worse in future clinical trials, if any; pre-clinical results related to cognition and the regulation of beta-APP will be substantiated by ongoing or future clinical trials, if any, or that any of its drug candidates will be able to improve the signs or symptoms of their respective clinical indication or slow the progression of Alzheimer's disease; any of its drug candidates will support an NDA filing or its equivalent, will be approved by the FDA or its equivalent, or if approved, will prove competitive in the market; or that Axonyx will have or obtain the necessary financing to support its drug development programs. Axonyx cannot assure that it will be successful with regard to identifying a (sub-) licensing partner for any of its compounds. Axonyx undertakes no obligation to publicly release the result of any revisions to such forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
Contact:
Axonyx Inc., New York
S. Colin Neill, 212-645-7704
www.axonyx.com
OR
Media:
Stephanie Carrington, 646-536-7017
scarrington@theruthgroup.com
SFCC...
Does anyone know anything about this company? TIA, 10nis
http://biz.yahoo.com/bw/051116/20051116005914.html?.v=1
MIAMI--(BUSINESS WIRE)--Nov. 16, 2005--SFBC International, Inc. (NASDAQ:SFCC - News), a provider of drug development services to branded pharmaceutical, biotechnology, generic drug and medical device companies, today was the subject of another article by a Bloomberg reporter. This is the second article that has questioned the company's processes for conducting trials. The initial article included SFBC within a much larger attack on the pharmaceutical industry. The latest, much shorter article focuses on SFBC. The assertions from "anonymous sources" concerning coercion and threats by SFBC employees, including contacting immigration authorities are baseless. In fact, Arnold Hantman, chief executive officer of SFBC International, has never met with any of the participants contrary to the reporting in the article and, to the best of his knowledge, none of the participants have ever met him. The participants were specifically told they will not be allowed to take part in further SFBC trials for the simple but important reason that they admitted to Bloomberg magazine that they falsified forms and presented false government identification. In addition, these participants violated the Confidentiality Agreement which is part of the consent form process.
SFBC believes there is no merit for the criticism of its practices. The information in both articles is inaccurate, and in the second article the information is just untrue. SFBC takes its responsibilities seriously to its clients, to federal and state regulators protecting human subjects, and to the people who volunteer to participate in its studies.
The processes the Company follows are fully compliant with all regulations and ethical standards. SFBC has never received a warning letter from FDA. SFBC has built its business around an excellent record of compliance and high quality studies. SFBC's clients have indicated they support its work.
SFBC obtains consents from all of the individuals who participate in its clinical trials and each participant voluntarily confirms his or her willingness to participate in a specific clinical trial only after being provided with full information regarding the clinical trial. SFBC takes very seriously both compliance with the law and all ethical guidelines. In obtaining consents from participants, SFBC follows good clinical practice guidelines, the principles of the Declaration of Helsinki, and the human subject protection requirements of 21 CFR Parts 50, 56, 312 and 314 and the ICH E-6. In addition, the Company is looking into adding an additional process of recording the consent process. SFBC continuously looks for additional ways to improve all of its processes.
SFBC remains committed to conducting the highest quality research. SFBC has every reason to believe that its clients will recognize the Company's good work and continue to maintain a high level of trust that the studies it conducts are of the highest quality.
About SFBC International, Inc.
SFBC International, Inc. provides early and late stage clinical drug development services to branded pharmaceutical, biotechnology, generic drug and medical device companies around the world. SFBC has more than 30 offices located in North America, Europe (including Central and Eastern Europe), South America, Asia, and Australia. In early clinical development services, SFBC specializes primarily in the areas of Phase I and early Phase II clinical trials and bioanalytical laboratory services, including early clinical pharmacology. SFBC also provides late stage clinical development services globally that focus on Phase II through IV clinical trials. SFBC also offers a range of complementary services, including data management and biostatistics, central laboratory services, medical and scientific affairs, regulatory affairs and submissions, and clinical IT solutions. Additional information is available on SFBC's website at http://www.sfbci.com.
Contact:
SFBC International, Miami
Carmen Bratter, 305-895-0304
or
Financial Dynamics
Evan Smith, CFA / Erica Pettit
212-850-5606 / 212-850-5614
MRK & BMY.........
Press Release Source: Bristol-Myers Squibb Company
Bristol-Myers Squibb Statement on Muraglitazar, an Investigational Oral Treatment For Type 2 Diabetes
Thursday October 27, 5:21 pm ET
PRINCETON, N.J., Oct. 27 /PRNewswire-FirstCall/ -- As previously disclosed, on October 18, 2005, the U.S. Food and Drug Administration (FDA) issued an approvable letter for muraglitazar, Bristol-Myers Squibb Company's (NYSE: BMY - News) investigational oral medicine for the treatment of type 2 diabetes. The FDA requested additional information from ongoing clinical trials to more fully address the cardiovascular safety profile of muraglitazar. We and our partner, Merck & Co., Inc., (Merck) have determined that to receive regulatory approval and to achieve commercial success, additional studies may be required because the ongoing trials were not designed to answer questions raised by the FDA. The additional studies could take approximately five years to complete.
In addition, Bristol-Myers Squibb has agreed to begin discussions with Merck to terminate the collaborative agreement.
Bristol-Myers Squibb will continue discussions with the FDA and will consider a range of options including conducting additional studies or terminating further development of muraglitazar.
Bristol-Myers Squibb is a global pharmaceutical and related health care products company whose mission is to extend and enhance human life.
This press release contains certain forward-looking information within the meaning of the Private Securities Litigation Reform Act of 1995 regarding a product in development that involves substantial risks and uncertainties. Such risks and uncertainties include, among other things, the uncertainty of the success of the research and development activities; decisions by regulatory authorities regarding whether and when to approve any new drug application for a product candidate that may result from the research, as well as their decisions regarding labeling and other matters that could affect the commercial potential of such product candidate; and competitive developments. A further list and description of risks and uncertainties can be found in the Bristol-Myers Squibb's Annual Report on Form 10-K for the fiscal year ended December 31, 2004, and in its reports on Form 10-Q and Form 8-K. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.
RE: IMCL stock buyback?
It isn't about profits but free cash flow generation. By reducing the outstanding shares, IMCL increases its profits or losses on a per share basis. Assuming IMCL generates profits, this in effect increases its bottom line growth rate.
IMCL looks like a good buy at the current price and I'm in agreement with Dew that IMCL is a potential takeover target.
Dew, if IMCL is ultimately purchased what price would do you think they'll be able to obtain? ~$45 or higher?
TIA,
10nis
Auditor resignings....
Resignings are more common today than they were 5 years ago, as accounting firms have been walking away from high risk or low-paying clients. GT either wanted to raise audit fees and CTIC wouldn't agree to that or GT doesn't like the risk/return of the client.
10nis
GENR
I think a PIPE is a guarantee. I find it very hard to believe that a deal (partnership, buyout) would be struck this quickly after the EYET deal.
I wonder what size the PIPE will be?
OT - Dew
I'm scheduled to be in NYC for at least the next month, so we should grab a nice business dinner if you can fit it in your schedule. Thanks again.
Re: Miscellaneous picks
Great... Thanks again Dew for your investment ideas. Are you ever in NYC?
Dew,
When I read the MF article, I was thinking you had wrote the article. At least this time MF was smart enough to steal most of there write-up from someone like yourself. Do you see any more interesting GTCB like values in the market?
Take care,
10nis
What do people think of KG (King Pharma)? They reported great earnings and I was able to buy it on the dip the day of its earnings release at 11.85. It seems overextended right now, however, what's everyone's long-term view on it? This is almost like Mad-Money... Buy, Sell or Hold.
In regards to the CPA question earlier, its somewhat common for people in Industry to make their license inactive - although, one would think a person aspiring to become a CFO would have kept it active. In becoming a CPA there's a state work experience requirement (WI - 3 years public, 5 years industry) although a few states have no experience requirement (IL for an example.) FYI - I'm one of the many CPA's in the country.
DEW.... What do you think of the news?
Press Release Source: GTC Biotherapeutics, Inc.
GTC Biotherapeutics Announces Private Placement of Common Stock and Warrants
Monday August 8, 7:58 am ET
FRAMINGHAM, Mass.--(BUSINESS WIRE)--Aug. 8, 2005--GTC Biotherapeutics, Inc. (Nasdaq: GTCB - News; "GTC") announced today that it has entered into definitive agreements with certain institutional investors for a private placement of Common Stock and Common Stock Purchase Warrants. GTC has agreed to sell an aggregate of approximately 4.57 million shares of Common Stock at $1.75 per share. The investors will also receive 5-year warrants to purchase an aggregate of approximately 1.8 million additional shares of GTC's Common Stock at an exercise price of $2.68 per share.
Rodman & Renshaw, LLC acted as exclusive placement agent for the securities sold in this transaction.
The proceeds of the financing are expected to be used for general corporate purposes, including funding GTC's ongoing clinical trial activities and preparations for commercialization of ATryn®, pending review of the Market Authorization Application (MAA) for ATryn® by the European Medicines Agency (EMEA).
This press release does not constitute an offer to sell or the solicitation of an offer to buy any security. The securities sold in this private placement have not been registered under the Securities Act of 1933, as amended, or applicable state securities laws and may not be offered or sold in the United States in the absence of an effective registration statement or exemption from registration requirements. GTC has agreed to file a resale registration statement on Form S-3 within 20 days after the closing of the transaction for purposes of registering the shares of Common Stock, as well as the shares of Common Stock underlying the warrants, acquired by these investors.
About GTC Biotherapeutics
GTC Biotherapeutics is a leader in the development, production, and commercialization of therapeutic proteins through transgenic animal technology. GTC currently has five products in its internal pipeline and a portfolio of external program production opportunities. GTC's lead program is ATryn®, its recombinant form of human antithrombin. An MAA is under review by the EMEA for the use of ATryn® in patients with a hereditary antithrombin deficiency. In addition to the ATryn® program, GTC is developing a recombinant human alpha-1 antitrypsin, a recombinant human albumin, a malaria vaccine, and a CD137 antibody to stimulate the immune system as a potential treatment for solid tumors. In its external programs, GTC's technology is used to develop transgenic production of its partners' proprietary products, including both large-volume protein therapeutics as well as products that are difficult to produce in significant quantities from conventional recombinant production systems. One of the external programs is in clinical trials with a transgenically produced product. Additional information is available on the GTC web site, http://www.gtc-bio.com.
--------------------------------------------------------------------------------
Contact:
GTC Biotherapeutics, Inc.
Thomas E. Newberry, 508-370-5374
or
Feinstein Kean Healthcare for GTC Biotherapeutics, Inc.
Francesca DeVellis, 617-577-8110
OT.... Good Goat publicity!!
http://www.cnn.com/2005/WORLD/africa/07/27/clinton.kenya.ap/index.html
Goats, cows offered for Chelsea Clinton
Wednesday, July 27, 2005; Posted: 3:38 a.m. EDT (07:38 GMT)
NAIROBI, Kenya (AP) -- A Kenyan says he offered Bill Clinton 40 goats and 20 cows for his daughter's hand in marriage five years ago -- and is still waiting for an answer.
Godwin Kipkemoi Chepkurgor told the East Africa Standard newspaper last week that he wrote to Clinton asking for Chelsea's hand in 2000 during the then-president's visit to Kenya.
Chepkurgor, a 36-year-old elected city councilor in Nakuru, recounted writing to the U.S president through the Kenyan government.
He described his plans for a grand wedding presided over by South African Nobel Peace Prize winner Archbishop Desmond Tutu. He named then-President Daniel arap Moi and the president of his university as references.
"Had I succeeded in wooing Chelsea, I would have had a grand wedding," he told the Standard in an interview published Friday during Clinton's recent visit to Kenya.
Chepkurgor said his letter praised Clinton's leadership and commended his wife, Senator Hillary Rodham Clinton, for standing by her husband "like an African woman" in the face of the Monica Lewinsky scandal.
The electrical engineering graduate said he promised to pay his would-be father-in-law 20 cows and 40 goats in dowry for his only daughter in accordance with African tradition.
But he said the letter prompted security checks -- on him, his family and his classmates, and he was summoned to the Foreign Ministry in Nairobi for a meeting that he missed because of his graduation from university.
A National Security Intelligence Service officer told the Standard the letter probably never made it out of the office.
"We gathered that this man was a teetotaler and a staunch Christian who seemed to have been struck by Chelsea, and I thought maybe he just took the joke too far," he said.
Chepkurgor vowed to remain single until he gets an answer to his proposal to marry Chelsea, 25.
Copyright 2005 The Associated Press. All rights reserved.This material may not be published, broadcast, rewritten, or redistributed.
Randy,
Do you mean how Schrushy got away with the fraud? or how he became a free man today?
Although an arrogant bastard, Schrushy is a highly intelligent man who knew that he could increase his chances of acquittal by getting involved in the black churches. So, he became an ordained minister and preached in black churches as well as on his own TV show. His attorney in the closing agruments made remarks that bordered on disgusting as he tried to appeal to the black jurors by making civil rights arguments that freeing Schrushy would allow them to provide the same justice that was provided to them. In the end, having the trial in Birmingham worked perfectly for Schrushy as the jury was half black and the intelligence level of the jury was poor at best. Had they tried him in DC, I think he would be facing a similar fate as Bernie Ebbers.
With respect to the fraud... It was everywhere and done in every way possible. Acquisition shenanigans, capitalizing expenses, booking fake revenue, etc.
Does that answer your question?
Dew - I completely agree. Schrushy's arrogance and attitude completely put me off to the company. Some of the emails I read that he sent out to his employees bordered on insanee. Also, I don't know how much of this is known, but Schrushy created a militia that owned machine guns and were in the process of buying hand grenades at the time of his arrest. He feared his employees.... I wonder why?
I had a few friends in the energy trading business back in the good all Enron days, and more than one of the them got the pleasure of spending a day or two answering justice department questions. They were shocked by Enron's trading floor hoax as everyone else and they were dealing with it hourly. Its pretty amazing how blind people can be to what would seem to be the obvious. Maybe AMD is more widespread than we think.....
Dew,
I've spent the last eight months at HealthSouth (HS) working on particular parts of its restatement and SEC filing that was filed yesterday. The fraud at HS was the most widespread of the high profile frauds, hitting 90% of all company accounts. Like all widespread frauds internal controls are non-existent and HS was no different as over 125 material weaknesses in internal controls have been documented. The average company has 2.
I don't know if SOX would have prevented the HS fraud as HS's previous auditors and consultants failed to do even the simpliest of tasks and lets hope they pay the price (for example, cash was overstated by over $300 million and cash is the easiest of all accounts to audit).
I do agree with you Dew that S-O should prevent frauds. Its extremely sad that someone as guilty as Schrushy walks free. Just a tragedy.
RICHARD SCHRUSHY has just been acquitted of all charges. The guilty bastard is going to walk.... Insane... I've spent eight months fixing his insane mess and they let him walk!!!
Just had to vent.... Everyone have a Great 4th of July Holiday.
Press Release Source: Genaera Corporation
Genaera Completes Special Protocol Assessment with FDA for EVIZON(TM) in Age-Related Macular Degeneration
Monday June 27, 8:30 am ET
-Phase III to Begin in June 2005-
PLYMOUTH MEETING, Pa., June 27 /PRNewswire-FirstCall/ -- Genaera Corporation (Nasdaq: GENR - News) today announced that it has reached agreement on a Special Protocol Assessment (SPA) with the U.S. Food and Drug Administration (FDA) for the design of two global registration Phase III clinical trials evaluating EVIZON(TM) (squalamine lactate) for the treatment of choroidal neovascularization associated with age-related macular degeneration (AMD), also known as "wet" AMD. This SPA is a binding written agreement between Genaera and the FDA that the clinical protocols for the planned Phase III trials are adequate to meet scientific and regulatory requirements to form the primary basis for efficacy claims in a new drug application (NDA) for EVIZON.
"We are very pleased to have sought and reached agreement with the FDA on the design of our Phase III trials of EVIZON in wet AMD," said Roy C. Levitt, MD, President and Chief Executive Officer of Genaera. "The SPA is an important milestone in our aggressive clinical development plans for EVIZON and solidifies our regulatory pathway towards FDA approval. With this SPA in hand we are ready to begin our registration trials in the very near future."
The two identical international Phase III studies are designed to enroll patients with predominantly classic, minimally classic and occult forms of wet AMD. Each study will be a multi-center, randomized, double-masked, controlled trial and will evaluate two systemically-administered doses of EVIZON (40 mg and 20 mg) versus placebo, dosed weekly for four weeks followed by maintenance doses every four weeks until week 104. Photodynamic therapy (PDT) will be allowed for all patients if deemed necessary by the study physician. The total number of patients enrolled into each Phase III study will be based upon analyses of data from the Company's existing and ongoing Phase II clinical trials, as agreed upon with the FDA.
The primary objectives of these studies are to demonstrate safety and significant clinical benefit of EVIZON therapy on visual acuity at one year in the study eye (assessed by Early Treatment Diabetic Retinopathy scoring system or ETDRS). Planned secondary analyses include evaluation of changes in visual acuity from baseline in the study eye at year two, change in visual acuity in fellow eyes affected with wet AMD, and quality of life.
"In our early Phase I and II trials EVIZON has stabilized or improved vision in most everyone we have treated, including patients with two affected eyes, with a good safety profile", commented Dr. Levitt. "We look forward to confirming these results by demonstrating a statistically significant clinical benefit in these upcoming large scale registration trials of EVIZON. Additionally, we intend to demonstrate in these studies the numerous advantages of systemic delivery of EVIZON, which is noninvasive to the eye, including the potential to treat the commonly affected fellow eye. Ultimately, as the leading systemic anti-angiogenic investigative new drug in development for the treatment of wet AMD, we hope to reveal the great potential EVIZON has to be a leading therapy in the rapidly growing AMD market."
Other Ongoing Clinical Trials
Genaera is currently conducting three Phase II trials of EVIZON in wet AMD at multiple sites throughout the United States. In October 2004, the FDA granted EVIZON Fast Track designation. In January 2005, the FDA selected EVIZON for participation in the Continuous Marketing Application (CMA) Pilot 2 program.
MSI-1256F-207 is a Phase II pharmacokinetic and safety trial that will evaluate 18 subjects with AMD at three different doses of EVIZON (10 mg, 20 mg or 40 mg) over four months. In this multi-center, open-label, parallel group study, EVIZON is administered intravenously once weekly for four weeks, and then all subjects were followed out to month 4 with no further treatment after week four. Depending on their response, patients may continue to receive EVIZON as needed for up to one additional year in a separate study (MSI-1256F- 211).
MSI-1256F-208 is a Phase II trial designed to evaluate the safety and clinical effects of three different doses of EVIZON (10 mg, 20 mg or 40 mg) with initial concomitant PDT with Visudyne® (QLT Inc., Vancouver, Canada) treatment in 45 patients with wet AMD. Specifically, this study will evaluate the safety and effects of systemically administered EVIZON before and after PDT with Visudyne. The multi-center, randomized, controlled, masked study also includes monthly EVIZON maintenance therapy through six months, along with an additional twelve months follow-up for each patient. Enrollment in this trial is closed.
MSI-1256F-209 is the cornerstone and largest of Genaera's three Phase II studies and is designed to evaluate the safety and efficacy of EVIZON in 100 patients with AMD over a two-year period. This Phase II multi-center, randomized, double masked, controlled study will evaluate two dose levels of EVIZON (20 mg or 40 mg) versus placebo, dosed once weekly for four weeks, followed by maintenance doses once every four weeks until week 48. At the end of 48 weeks of therapy, each patient will be followed for a further 12 months. Enrollment in this trial is closed.
For information about participation in EVIZON clinical trials, patients and physicians may call Genaera's Clinical Trial Hotline at (800) 299-9156.
About EVIZON(TM)
EVIZON is a unique first in class synthetic small molecule administered systemically that directly interrupts and reverses multiple facets of the angiogenic process. Working within activated endothelial cells, EVIZON inhibits growth factor signaling including VEGF, integrin expression, and reverses cytoskeletal formation, thereby resulting in endothelial cell inactivation and apoptosis. Systemically administered EVIZON inhibits abnormal angiogenesis in rodent models of retinopathy of prematurity, and the development of choroidal neovascular membranes in rat models of AMD. Additional preclinical studies have demonstrated that systemic EVIZON administration is effective in reaching abnormal ocular blood vessels in primates, and leads to partial regression and inhibition of new abnormal vessels in the eye. These results support that EVIZON may have a role in the treatment of human choroidal neovascular membrane formation that underlies the pathology of wet AMD.
About AMD
Wet AMD resulting from angiogenesis is the leading cause of legal blindness among adults age 50 or older in the Western world. Approximately 25 to 30 million people are affected globally and this number is expected to triple over the next 25 years.
AMD occurs in two types: the "dry" form and the more severe "wet" form. Wet AMD is caused by the growth of abnormal blood vessels, or choroidal neovascularization, under the central part of the retina, the macula. Dry AMD, or the avascular form is the more common and milder form of AMD, accounting for 85% to 90% of all cases. Dry AMD results in varying forms of sight loss and may or may not eventually develop into the wet form. Although the wet form of AMD accounts for only 10% to 15% of all AMD, the chance for severe sight loss is much greater. It is responsible for 90% of severe vision loss associated with AMD. Approximately 500,000 new cases of wet AMD are diagnosed annually worldwide. In North America alone, approximately 200,000 new cases of wet AMD are diagnosed each year.
GTCB is rocking!! Dew thanks again for all your great research and for this site.
OT....
Does anyone on this board work for an investment management firm that is hiring? I'm a CPA (working for the Big 4 firm with the longest name) and currently a Level III candidate of the CFA Program and would really like to get into some realm of investment management (research, portfolio management, etc.).
Red: About the $ big-pharma re-patriation:
SEC. 965. TEMPORARY DIVIDENDS RECEIVED DEDUCTION.
965(a) DEDUCTION. --
965(a)(1) IN GENERAL. --In the case of a corporation which is a United States shareholder and for which the election under this section is in effect for the taxable year, there shall be allowed as a deduction an amount equal to 85 percent of the cash dividends which are received during such taxable year by such shareholder from controlled foreign corporations.
965(a)(2) DIVIDENDS PAID INDIRECTLY FROM CONTROLLED FOREIGN CORPORATIONS. --If, within the taxable year for which the election under this section is in effect, a United States shareholder receives a cash distribution from a controlled foreign corporation which is excluded from gross income under section 959(a), such distribution shall be treated for purposes of this section as a cash dividend to the extent of any amount included in income by such United States shareholder under section 951(a)(1)(A) as a result of any cash dividend during such taxable year to --
965(a)(2)(A) such controlled foreign corporation from another controlled foreign corporation that is in a chain of ownership described in section 958(a), or
965(a)(2)(B) any other controlled foreign corporation in such chain of ownership, but only to the extent of cash distributions described in section 959(b) which are made during such taxable year to the controlled foreign corporation from which such United States shareholder received such distribution.
965(b) LIMITATIONS. --
965(b)(1) IN GENERAL. --The amount of dividends taken into account under subsection (a) shall not exceed the greater of -
965(b)(1)(A) $500,000,000,
965(b)(1)(B) the amount shown on the applicable financial statement as earnings permanently reinvested outside the United States, or
965(b)(1)(C) in the case of an applicable financial statement which fails to show a specific amount of earnings permanently reinvested outside the United States and which shows a specific amount of tax liability attributable to such earnings, the amount equal to the amount of such liability divided by 0.35.
The amounts described in subparagraphs (B) and (C) shall be treated as being zero if there is no such statement or such statement fails to show a specific amount of such earnings or liability, as the case may be.
965(b)(2) DIVIDENDS MUST BE EXTRAORDINARY. --The amount of dividends taken into account under subsection (a) shall not exceed the excess (if any) of --
965(b)(2)(A) the dividends received during the taxable year by such shareholder from controlled foreign corporations, over
965(b)(2)(B) the annual average for the base period years of -
965(b)(2)(B)(i) the dividends received during each base period year by such shareholder from controlled foreign corporations,
965(b)(2)(B)(ii) the amounts includible in such shareholder's gross income for each base period year under section 951(a)(1)(B) with respect to controlled foreign corporations, and
965(b)(2)(B)(iii) the amounts that would have been included for each base period year but for section 959(a) with respect to controlled foreign corporations.
The amount taken into account under clause (iii) for any base period year shall not include any amount which is not includible in gross income by reason of an amount described in clause (ii) with respect to a prior taxable year. Amounts described in subparagraph (B) for any base period year shall be such amounts as shown on the most recent return filed for such year; except that amended returns filed after June 30, 2003, shall not be taken into account.
965(b)(3) REDUCTION OF BENEFIT IF INCREASE IN RELATED PARTY INDEBTEDNESS. --The amount of dividends which would (but for this paragraph) be taken into account under subsection (a) shall be reduced by the excess (if any) of --
965(b)(3)(A) the amount of indebtedness of the controlled foreign corporation to any related person (as defined in section 954(d)(3)) as of the close of the taxable year for which the election under this section is in effect, over
965(b)(3)(B) the amount of indebtedness of the controlled foreign corporation to any related person (as so defined) as of the close of October 3, 2004.
All controlled foreign corporations with respect to which the taxpayer is a United States shareholder shall be treated as 1 controlled foreign corporation for purposes of this paragraph.
965(b)(4) REQUIREMENT TO INVEST IN UNITED STATES. --Subsection (a) shall not apply to any dividend received by a United States shareholder unless the amount of the dividend is invested in the United States pursuant to a domestic reinvestment plan which --
965(b)(4)(A) is approved by the taxpayer's president, chief executive officer, or comparable official before the payment of such dividend and subsequently approved by the taxpayer's board of directors, management committee, executive committee, or similar body, and
965(b)(4)(B) provides for the reinvestment of such dividend in the United States (other than as payment for executive compensation), including as a source for the funding of worker hiring and training, infrastructure, research and development, capital investments, or the financial stabilization of the corporation for the purposes of job retention or creation.
965(c) DEFINITIONS AND SPECIAL RULES. --For purposes of this section --
965(c)(1) APPLICABLE FINANCIAL STATEMENT. --The term "applicable financial statement" means, with respect to a United States shareholder, the most recently audited financial statement (including notes and other documents which accompany such statement) which includes such shareholder --
965(c)(1)(A) which is certified on or before June 30, 2003, as being prepared in accordance with generally accepted accounting principles, and
965(c)(1)(B) which is used for the purposes of a statement or report --
965(c)(1)(B)(i) to creditors,
965(c)(1)(B)(ii) to shareholders, or
965(c)(1)(B)(iii) for any other substantial nontax purpose.
In the case of a corporation required to file a financial statement with the Securities and Exchange Commission, such term means the most recent such statement filed on or before June 30, 2003.
965(c)(2) BASE PERIOD YEARS. --
965(c)(2)(A) IN GENERAL. --The base period years are the 3 taxable years --
965(c)(2)(A)(i) which are among the 5 most recent taxable years ending on or before June 30, 2003, and
965(c)(2)(A)(ii) which are determined by disregarding --
965(c)(2)(A)(ii)(I) 1 taxable year for which the sum of the amounts described in clauses (i), (ii), and (iii) of subsection (b)(2)(B) is the largest, and
965(c)(2)(A)(ii)(II) 1 taxable year for which such sum is the smallest.
965(c)(2)(B) SHORTER PERIOD. --If the taxpayer has fewer than 5 taxable years ending on or before June 30, 2003, then in lieu of applying subparagraph (A), the base period years shall include all the taxable years of the taxpayer ending on or before June 30, 2003.
965(c)(2)(C) MERGERS, ACQUISITIONS, ETC. --
965(c)(2)(C)(i) IN GENERAL. --Rules similar to the rules of subparagraphs (A) and (B) of section 41(f)(3) shall apply for purposes of this paragraph.
965(c)(2)(C)(ii) SPIN-OFFS, ETC. --If there is a distribution to which section 355 (or so much of section 356 as relates to section 355) applies during the 5-year period referred to in subparagraph (A)(i) and the controlled corporation (within the meaning of section 355) is a United States shareholder --
965(c)(2)(C)(ii)(I) the controlled corporation shall be treated as being in existence during the period that the distributing corporation (within the meaning of section 355) is in existence, and
965(c)(2)(C)(ii)(II) for purposes of applying subsection (b)(2) to the controlled corporation and the distributing corporation, amounts described in subsection (b)(2)(B) which are received or includible by the distributing corporation or controlled corporation (as the case may be) before the distribution referred to in subclause (I) from a controlled foreign corporation shall be allocated between such corporations in proportion to their respective interests as United States shareholders of such controlled foreign corporation immediately after such distribution.
Subclause (II) shall not apply if neither the controlled corporation nor the distributing corporation is a United States shareholder of such controlled foreign corporation immediately after such distribution.
965(c)(3) DIVIDEND. --The term "dividend" shall not include amounts includible in gross income as a dividend under section 78, 367, or 1248. In the case of a liquidation under section 332 to which section 367(b) applies, the preceding sentence shall not apply to the extent the United States shareholder actually receives cash as part of the liquidation.
965(c)(4) COORDINATION WITH DIVIDENDS RECEIVED DEDUCTION. --No deduction shall be allowed under section 243 or 245 for any dividend for which a deduction is allowed under this section.
965(c)(5) CONTROLLED GROUPS. --
965(c)(5)(A) IN GENERAL. --All United States shareholders which are members of an affiliated group filing a consolidated return under section 1501 shall be treated as one United States shareholder.
965(c)(5)(B) APPLICATION OF $500,000,000 LIMIT. --All corporations which are treated as a single employer under section 52(a) shall be limited to one $500,000,000 amount in subsection (b)(1)(A), and such amount shall be divided among such corporations under regulations prescribed by the Secretary.
965(c)(5)(C) PERMANENTLY REINVESTED EARNINGS. --If a financial statement is an applicable financial statement for more than 1 United States shareholder, the amount applicable under subparagraph (B) or (C) of subsection (b)(1) shall be divided among such shareholders under regulations prescribed by the Secretary.
965(d) DENIAL OF FOREIGN TAX CREDIT; DENIAL OF CERTAIN EXPENSES. --
965(d)(1) FOREIGN TAX CREDIT. --No credit shall be allowed under section 901 for any taxes paid or accrued (or treated as paid or accrued) with respect to the deductible portion of --
965(d)(1)(A) any dividend, or
965(d)(1)(B) any amount described in subsection (a)(2) which is included in income under section 951(a)(1)(A).
No deduction shall be allowed under this chapter for any tax for which credit is not allowable by reason of the preceding sentence.
965(d)(2) EXPENSES. --No deduction shall be allowed for expenses properly allocated and apportioned to the deductible portion described in paragraph (1).
965(d)(3) DEDUCTIBLE PORTION. --For purposes of paragraph (1), unless the taxpayer otherwise specifies, the deductible portion of any dividend or other amount is the amount which bears the same ratio to the amount of such dividend or other amount as the amount allowed as a deduction under subsection (a) for the taxable year bears to the amount described in subsection (b)(2)(A) for such year.
965(e) INCREASE IN TAX ON INCLUDED AMOUNTS NOT REDUCED BY CREDITS, ETC. --
965(e)(1) IN GENERAL. --Any tax under this chapter by reason of nondeductible CFC dividends shall not be treated as tax imposed by this chapter for purposes of determining --
965(e)(1)(A) the amount of any credit allowable under this chapter, or
965(e)(1)(B) the amount of the tax imposed by section 55.
Subparagraph (A) shall not apply to the credit under section 53 or to the credit under section 27(a) with respect to taxes attributable to such dividends.
965(e)(2) LIMITATION ON REDUCTION IN TAXABLE INCOME, ETC. --
965(e)(2)(A) IN GENERAL. --The taxable income of any United States shareholder for any taxable year shall in no event be less than the amount of nondeductible CFC dividends received during such year.
965(e)(2)(B) COORDINATION WITH SECTION 172. --The nondeductible CFC dividends for any taxable year shall not be taken into account --
965(e)(2)(B)(i) in determining under section 172 the amount of any net operating loss for such taxable year, and
965(e)(2)(B)(ii) in determining taxable income for such taxable year for purposes of the 2nd sentence of section 172(b)(2).
965(e)(3) NONDEDUCTIBLE CFC DIVIDENDS. --For purposes of this subsection, the term "nondeductible CFC dividends" means the excess of the amount of dividends taken into account under subsection (a) over the deduction allowed under subsection (a) for such dividends.
965(f) ELECTION. --The taxpayer may elect to apply this section to --
965(f)(1) the taxpayer's last taxable year which begins before the date of the enactment of this section, or
965(f)(2) the taxpayer's first taxable year which begins during the 1-year period beginning on such date.
Such election may be made for a taxable year only if made before the due date (including extensions) for filing the return of tax for such taxable year.
Red: About the $ big-pharma re-patriation:
NEWS, NEWS , Treasury and IRS Issue Guidance on Repatriation of Dividends Under Code Sec. 965 (TDNR JS-2195; Notice 2005-10; Treasury Department Fact Sheet) (January 2005)
Treasury and IRS Issue Guidance on Repatriation of Dividends Under Code Sec. 965 (TDNR JS-2195; Notice 2005-10; Treasury Department Fact Sheet) (January 2005)
The Treasury and IRS have issued the first in a series of guidance releases on the temporary dividends-received deduction under Code Sec. 965 (repatriation of dividends provision). The provision, which was added by the American Jobs Creation Act of 2004 (P.L. 108-357 ), generally provides that the U.S. corporate shareholder of a controlled foreign corporation (CFC) may elect for one tax year, an 85-percent dividends-received deduction for the cash distributions it receives from the CFC. For the deduction to apply, the dividend must, among other requirements, be invested in the United States pursuant to a domestic reinvestment plan. The guidance focuses on the definition of a cash dividends, domestic reinvestment plans, permitted and nonpermitted investments in the United States and reporting and administrative requirements. Future guidance will cover the foreign tax credit and expense allocation, rules for adjusting the calculation of base period amounts taken into account in mergers, acquisitions and spin-offs and rules regarding controlled groups. The guidance is effective for tax years for which taxpayers have elected Code Sec. 965 and any relevant subsequent tax year.
Cash Dividends
The guidance provides details for determining whether a cash dividend has been paid. The term"cash dividend" includes cash amounts treated as dividends pursuant to Code Sec. 965(a)(2) (receipt of boot treated as a dividend). It also includes cash in both U.S. and foreign currency. The fact that a CFC held cash equivalents, within the meaning of Reg. §1.897-7T(a) before the payment of a cash dividend, and the U.S. shareholder holds cash equivalents after the payment of the dividend, will not cause the IRS to recharacterize the dividend as the distribution by a CFC of cash equivalents (rather than a required distribution of cash).
Cash dividends may be paid by a CFC to a pass-through entity, such as a partnership or disregarded entity owned by the U.S. shareholder if the shareholder receives cash in the amount of the CFC dividend during the tax year for which the election is in effect.
The guidance provides rules to coordinate Code Sec. 965 with Code Sec. 959 , previously taxed income rules. Distributions out of earnings and profits described in Code Sec. 959(c)(1) and Code Sec. 959(c)(2) (distributions attributable to earnings and profits included in income under Code Sec. 951 ) do not qualify as dividends.
Domestic Reinvestment Plan
The requirements for a dividend reinvestment plan were generally vague as enacted by the 2004 Jobs Act. The new release provides the much-needed guidance for establishing a plan. In general, a domestic reinvestment plan must be in writing and must describe how the dividend is to be reinvested in the United States with reasonable detail and specificity. The plan may cover more than one cash dividend from one or more CFCs. A taxpayer may also adopt separate plans for different cash dividends subject to the election.
The guidance clarifies provisions dealing with the approval of the dividend reinvestment plan. Code Sec. 965(b)(4)(A) requires that the plan be approved by the president or similar official before the dividend is paid and that there be subsequent approval by the board of directors or other body with similar authority. The guidance provides that the subsequent approval can take place after the dividend is paid and no special meeting is required.
The domestic reinvestment plan must describe specific anticipated investments in the United States. The IRS and Treasury do not intend to issue a template or form for the plan. The composition of a plan may vary according to the type of investments anticipated. Relevant facts and circumstances, such as the type of investment, the time period for the investments and factors that might affect the ability to make the investments, are relevant facts and circumstances that can be taken into account in applying the reasonable specificity standard. The plan must provide the detail necessary to demonstrate upon examination that the expenditures subsequently incurred were contemplated at the time the plan was adopted. The plan may provide for alternative investments to cover situations where the principal investments are delayed or rejected. Subject to a special transition rules for dividends paid before January 13, 2005, a taxpayer may not modify or amend the plan after the dividend is paid.
Taxpayers will not be required to trace or segregate the specific dividend proceeds received to demonstrate proper investment, and, as long as a sufficient amount of funds is properly invested pursuant to the plan, nonpermitted investments will not generally affect the eligibility of the dividend. A plan may be subject to greater scrutiny if it provides for investment over a number of years during which the taxpayer is making nonpermitted investments. Expenditures made in the tax year of the election are considered to be made pursuant to the domestic reinvestment plan, no matter when they are made during the year. Thus, expenditures for permitted investments made during the plan year, but prior to the cash dividend, may qualify as permitted investments. If a U.S. shareholder expends less than the full amount of the dividend on permitted investments, the dividend satisfies the requirements only to the extent of the amount expended.
Permitted, Nonpermitted Investments
A nonexclusive list of permitted investments is described in the guidance. Generally, payments must be made to unrelated persons and must be in cash. Details are provided on the following permitted investments:
(1) funding of worker hiring, training and other compensation (generally, expenditures for hiring new workers and training new and existing workers, compensation and benefits);
(2) infrastructure and capital investments (physical installations and facilities that support the business and other assets integral to the conduct of the business, provided the infrastructure and investment is in the United States);
(3) research and development (generally, expenditures that qualify under Reg. §1.174-2 for research and development conducted in the United States);
(4) financial stabilization of the corporation for purposes of job retention or creation (including repayment of taxpayer debt, satisfaction of an obligation to fund a qualified plan and other expenditures that contribute to this purpose under the facts and circumstances);
(5) acquisition of interests in business entities (such as a corporation or partnership and regardless of whether the entity is foreign or domestic, if the taxpayer owns directly or indirectly at least 10 percent of the value of the business entity after the acquisition);
(6) advertising and marketing expenditures (expenditures with respect to trademarks, trade names, brand names or similar intangible property if the activities are performed in the United States); and
(7) intangible property (purchased or licensed if the rights to the property are used in the United States).
The financial stabilization category requires the company to reasonably believe that stabilization will help the company retain or create jobs. It includes the repayment of debt, whether or not the lender is a U.S. person, and the funding of a pension plan. Payments for liabilities, including legal settlements, could be permissible under this category. The corporation cannot repay debt and then replace the debt with a loan on substantially the same terms. A buy-down of the corporation's stock is not a permitted investment. The Treasury officials said they gave this issue a hard look, before deciding the use was not permitted.
A nonexclusive list of investments that are not permitted are described in the guidance. Details are provided on the following nonpermitted investments:
(1) executive compensation;
(2) intercompany distributions, obligations and transactions;
(3) dividends and other distributions with respect to stock;
(4) stock redemptions;
(5) portfolio investments in business entities;
(6) acquisition of debt instruments or other evidences of debt; and
(7) tax payments.
Reporting/Administrative Requirements
The election to apply Code Sec. 965 is made by filing Form 8895, with a timely filed return, including extensions, for the tax year. Prior to the issuance of Form 8895, a taxpayer must attach a statement to the return to make the election. A taxpayer must also attach an information statement to the tax return for the tax year of the election and for every subsequent year that the investments required under the plan are not made by the beginning of the year. Although a facts and circumstances test is used to determine whether a dividend has been properly invested, a safe harbor method is provided under which a taxpayer will be considered to have established proper investment if progress toward completion of the planned U.S. investments is shown. Transition rules are provided for dividends paid and tax returns filed prior to January 13, 2005.
Fact Sheet
A fact sheet issued by the Department of Treasury highlights, in question-and-answer format, certain points about Code Sec. 965 and the guidance issued. Specifically, Code Sec. 965 can apply to either 2004 or 2004 calendar-year taxpayers, depending on whether the taxpayer elects to apply the provision to the last tax year that begins before October 22, 2004, or the first tax year that begins during the one-year period beginning on October 22, 2004. Additionally, a corporation subject to a 35-percent corporate tax rate on the 15-percent amount of the dividend not repatriated would be subject to an effective tax rate of 5.25 percent. The tax break can be used only for the year specified; it cannot be used in later years. Companies do not have to trace or segregate repatriated funds and there is no time limit for investment. Tort liabilities, as permitted investments, are not specifically addressed in the guidance. Expenditures for financial stablilization for domestic job retention or creation is a permitted use and would cover a payment to satisfy a company's outstanding liabilities.
IRS Chief Counsel Donald Korb said at a press conference that the new guidance will give corporations the time they need to establish their reinvestment plan by the end of 2005. At the same time, he indicated, the guidance will give IRS examiners"the necessary roadmap to ensure compliance with the new rules."
The repatriation rules were issued less than three months after the 2004 Jobs Act took effect and are the third major project required by the Act. In the past two months, the Treasury and the IRS have issued guidance on the 2004 Jobs Act's tax shelter and deferred compensation provisions. Guidance on the Act's new manufacturing deduction should come out"very soon," Korb indicated.
"Given the importance of the new repatriation provision to U.S. companies, coupled with the immediate effective date of the provision and its temporary nature, issuance of prompt guidance was a major priority," said Eric Solomon, Treasury Acting Deputy Assistant Secretary for Tax Policy.
The Treasury and the IRS will issue subsequent guidance on other important aspects of Code Sec. 965 , including the calculation of the base period dividend amounts, the foreign tax credit and allocation of expenses, and acquisitions, spin-offs and controlled groups. Work has begun on next piece of guidance but Solomon said that it is too early to know when the guidance will be issued.
Treasury Department News Release, TDNR JS-2195
Notice 2005-10
Treasury Department Fact Sheet
Other References:
Code Sec. 965