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Stocks A / Aurora Biosciences Corp.


Subject:  Annual Report Date:  5/4/2000  2:06 AM
Author:  foolestest Number:  122 of 195

Well, all my concerns were confirmed last night as I read through the annual report from Aurora. Consistant and dependable revenue, penalty phases, and R&D expenses (albeit, the latter is not even really a blip on my screen).

I was hoping to elicate some opinions on those issues and this company in general.

Revenue - Can Aurora be profitable even if their customers do not develop drugs as a direct result of using one of Aurora's machines (this would mean Aurora would get royalty payments). Now of course the company says yes, but I just don't see where revenue would come from in the event that the Ultra high blah blah blah just doesn't pan out for Mr. Drug Maker. I guess that's at the heart of it all, isn't it? If Aurora's machines don't do the job, the company is out the door. Comments?

Penalties - The annual report confirmed that Aurora is in the penalty phase with Bristol-Meyers and Warner-Lambert. $1,000,000 is a hefty penelty to pay. I am of the opinion that these fees, assuming full amount must be payed, would be a short term set back, indeed. However, the business, more importantly the technology, can recover this money. Comments? Do we know exactly where the penelties stand? Are we approaching penalties for other customers?

R&D - Can anyone explain why, really why, R&D costs went DOWN this last year. Seems contrary to what they are doing, or does it?

Hey, I'm still long on ABSC, just want to feel it out a little more. Don't we all?
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