Bobwins and board re VPHM:
I should undoubtedly clarify an earlier post. I have not read anywhere that the company is guiding to $1 in earnings. It is simply my sense of what their guidance means, and I apologize if a post of mine was misleading. To be more accurate:
On March 10, the company's PR states:
"For the year 2005, ViroPharma expects the following:
- Net product sales: $62-$66 million, representing growth
of 15% to 22% over unaudited net product sales of Vancocin
in 2004;
- Total operating expenses: $46-$58 million, including:
-- Cost of Sales: $20-$24 million;
- Included in cost of sales is the royalty to Lilly,
which is expected to be between $9.0 million and
$10.5 million. There are no royalties payable on
net product sales below $44 million or above
$65 million.
-- Research and development expense: $16-$21 million;
-- Marketing, general and administrative expense:
$10-$13 million;
- Approximately $3 million of marketing, general
and administrative expense is expected to be
associated with the medical education program
for Vancocin.
- Cash balance: ViroPharma expects to be at least cash flow
neutral in 2005, with a cash balance at year end 2005 of
$45-$50 million."
On May 3, the company's PR revised this guidance in the following respects:
"For the year 2005, ViroPharma expects the following:
-- Net product sales: $74 to $79 million, representing growth of 37% to 46% over unaudited net product sales of Vancocin in 2004;
-- Total operating expenses: $38 to $47 million;
-- Cost of sales: $12 to $13 million;
-- Cash balance: ViroPharma expects to be cash flow positive from operating activities in 2005."
These are not small changes.
Frankly, my sense from the presentation yesterday was that the company is already beginning to see its guidance of May 3 as too conservative, but is reluctant to re-raise guidance 2 weeks later!
Again, sorry if I have misled.
Steve
