While I agree that Immunex (IMNX) is a solid company, investors should avoid the stock for three reasons: One, most of the positive news surrounding its lead rheumatoid arthritis drug, Enbrel, seems to be factored into the share price. Two, Wall Street appears to be banking on a pretty tight deadline for the product's anticipated approval to also treat psoriatic arthritis, a debilitating condition that affects the skin and the joints. And three, the timing to receive approval for its new manufacturing capacity is in question.

Folks, let's face it -- the whole world knows that demand for Enbrel for rheumatoid arthritis is strong. After all, management and several high-profile Wall Street analysts have said so -- several times over. In addition, it's also no secret that Enbrel appears to be a shoo-in to receive Food and Drug Administration approval to treat psoriatic arthritis, of which there are more than 300,000 sufferers in the U.S. alone. Recent clinical studies appear to confirm this assumption.

But what I'm worried about is that the sell side is banking on an approval for psoriatic arthritis by some time in the first half of 2002. Why am I worried? Simple. You see, these days the FDA is extremely cautious in its review process. Safety and efficacy are its two primary concerns. Timing is not. As a result, attempting to estimate the length of the process has become exceedingly difficult. And


delay easily could throw off 2002 or 2003 revenue forecasts.

Plus, I've spoken with a number of retail and institutional players who are concerned that Immunex might have trouble meeting the mid-2002 target it set to get its new manufacturing facility in Rhode Island up and running. After all, the plant can't just start kicking out product as soon as the building is finished. It must receive approval from the FDA before it begins to produce material for distribution. And although Wall Street is figuring on an early third-quarter 2002 approval, a delay of a few months or more is not beyond the realm of possibility.

For those who think I'm shortsighted on this one, you're right. Over the long haul, things are definitely improving for Immunex. It's just that the recent chain of positive news flow could be broken in the coming quarters by an unforeseen delay in the approval of either Enbrel for treating psoriatic arthritis or the manufacturing plant. As a result, I firmly believe that a better entry point may lie ahead.

In keeping with TSC's editorial policy, Glenn Curtis doesn't own or short individual stocks. He also doesn't invest in hedge funds or other private investment partnerships. Curtis welcomes your feedback and invites you to send it to

Glenn Curtis.