Biotech Values

[acgood]

Quote:
They had a reasonable explanation for the Zev sales decline on the CC, IMO


What was Raj's explanation?

I disagree that the explanation by SPPI's "Dr Raj" was reasonable.

The question was asked by at least 3 different analysts and none of them got a satisfactory answer. Major excuse was that first quarter tends to be weakest because patient co-pays reset on January 1st (same excuse came recently from ADLR re Entereg sales too), and this is bigger deal for Zevalin because it is a single dose treatment not something with recurring copays. If you buy this, this explains the sequential decline from 4q10 to 1q11- but not the year on year drop from 1q10 to 1q11. Their excuse for that was something about the mix of government-pay vs private pay patients. For me to believe that though, they would have had to give some hard numbers (ie, 2010 the mix was 40% govt and this year it was 75%)...but they never give hard numbers on anything.

So this makes two straight times the have pre-announced about how great their earnings are (while not breaking out Zevalin vs Fusilev). And now two straight times the Zevalin sales have been disappointing (4q10) or disasterous (1q11)

I'll be the first to admit I thought they would have gotten better traction now on the sales. But clearly they haven't. Perhaps removal of the bioscan requirement will help, but that won't affect sales until 2012.