Replies to post #50542 on Ariad Pharmaceuticals Inc fka ARIA

[biotech_researcher]

2damoon, words can't express the thanks we all owe you for your dedicated approach in researching and understanding Ariad. Unquestionably, you are influencing Ariad's direction by presenting issues and ideas to Ariad's management team that can only help support or confirm their approaches as an outsider. To think that a message board poster here on iHub can have the accessibility to a company such as Ariad, is remarkable. Please don't ever leave this board. Thanks again.. Can I add that I detect a shift in your prognosis of Ariad?

[rumrunner528]

The vote on the Section 382 Rights Agreement (NOL protection or Poison Pill, depending on your perspective) was very close. Roughly 47 million to 38 million. I may be stating the obvious, but I believe the Amendment that was filed Tuesday evening was a negotiation that allowed it to pass. My takeaway from this is that HB wanted the protection but the institutions involved in the negotiations were okay with just 3 more years. My speculation is that Denner alone was the negotiating party, but that's pure guessing.

2da, while the BoD and Management gave serious consideration to your question of raising the price of Iclusig to reflect the orphan status that Iclusig effectively has, I thought their response was well thought out. I believe their feeling is that, if they were to raise the price significantly they would lose every patient except the ones with the T315I mutation. That T315I patient population for them is currently low. In order to make up for lost revenue from losing the other CML patients, they would have to raise the price at least 7 fold. They feel that isn't reasonable. Also, considering they are diligently working on moving Iclusig up in the overall CML indication, they wanted to maintain and grow a base of patients which they undoubtedly would lose at extremely inflated prices.

Lastly, I was able to spend some time with Ed Fitzgerald. I asked about the convertible offering. My question was primarily why put the $9.30 to $12.00 hedging transaction on at a net cost of $17 million and potentially 20 million more shares of dilution. The value of the protection seems to be the difference in the strike prices of $2.70 times 20 million shares or $54 million. It doesn't sound like a great deal to me. He gave a very thoughtful review of the alternatives available to Ariad and he clearly knew the subject very well. I left feeling that the convertible issue was a good deal and good idea, but I still don't believe the hedging was necessarily worth the money spent.

I think we all owe 2da a thank you for the time and effort he has made on our behalf.

rum

[Jesspro]

Nice elaborate post 2da...

[AmpleKind]

2da, thanks for your excellent summary and your efforts in general.

I thought one of the more interesting discussions was in response to
your question about raising the price of Iclusig. Obviously a very complex
issue, and Marty's explanation of what went into it gives
us on the outside some idea of the complexity and number of considerations
that go into making a business decision (one of many!).

I thought that Dr.Clackson was very cagey on the next molecule, but I
think this is simply part of what Ariad made very clear, was an important
competitive issue. I think he's playing poker. My take on it is that the
molecule could be out in a month, or Dec 31st, I don't think they want
the competition to know yet.

Thanks again for your notes (and rum and mican also).

[Maciste]

Thanks for you post 2da, very much appreciate your time and effort. As always you are a class act.

[trading_cyclist]

Great post. Thank you for that.