|Date:||Fri, 27 Feb 2004 12:53:20 +1300|
I know a bit about Genesis:
* a research based Biotech company - does fundamental research and patents the results
* two basic divisions - plant sciences and human health
* recent setback with PVAC eczema phase II trials declared a failure
* WRI.NZX a significant investor - mainly interested in the plant sciences/forestry side of the buisiness (could have even forced the recent formal split of the company into the two divisions pending some future separation).
The company is best judged on its patent rate (reasonably high - see the web site)
Valuation is difficult - share price is close to current cash reserves
Jim Watson is very highly regarded internationally as a researcher
Investment in GEN.NZX should be considered highly speculative.
However, there are many positive points:
* excellent people are involved in the company
* patent rate is very high - share price values existing patents at practically nothing
* cash burn rate - the cash will eventually run out - it is not clear how forward company momentum will be funded
* commercialisation - big question about exactly how the existing and future IP will be turned into cash
Disclosure: Hold GEN.NZX