Replies to post #32590 on RespireRx Pharmaceuticals Inc (fka RSPI)

[atheroprevent]

Dew, good point on cost-shifting to the biotech investors. How many times though, can you sell the Brooklyn Bridge? Not likely to Cor shareholders.

Haysaw, last time I looked, the government investment into diabetes R+D was < 1% of what was they paid in patient care in that area. This is also the disease, with fastest world wide growth, that will break the health care budgets.

Pressures to reduce patent life and the increased safety expectations and requirements of new drugs will further conspire to reduce likelihood of biotech profitability. A lot more than good management is required. In health care delivery it will be easy to provide good management, but no one will like it. It will equate to rationing in a disguised form.

I liked the story of the ABT secretary who bought 3 shares of ABT for 180 in 1935, reinvested dividend and cashed out 7 million (annualized 15%). Will this happen again in pharma?

[enemem]

>>> Big Pharma has recognized that it makes economic sense to offload some of the cost of research failures to bagholder biotech investors, who have a nearly unlimited appetite for chasing the promise of newfangled technologies.

Short-term sense at best. Microcap biotech is not a viable business model, irrespective of the science, because it cannot secure operating capital. Why would a VC or anybody else assume risks that cash-rich, well-informed BPs are unwilling to? Unless BP's strategic choice to off-load R&D costs is matched by a shift towards funding earlier stage compounds, BPs will be able to harvest one last round of late-stage compounds from existing microcaps, and then that's that. My sense is that the current conventional wisdom dooms all microcaps with early-stage compounds, regardless of how promising they are, because the costs associated with bringing a molecule to the point where it can be outlicenced is prohibitive.

Irrespective of how inept corx's management is (that's a topic that really doesn't interest me any more), the value of corx's IP is self-evident. If this company goes under, the outlook for biotech as a whole is bleak. The combination of short-term biotech thinking, and a disfunctional regulatory environment dooms one of the few economic sectors in which the US could still be competitive.