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Four analysts and top management from twenty sector firms examine the Medical Technology sector in this special 98-page issue from The Wall Street Transcript, available at (212/952-7433) or http://www.twst.com/info/info375.htm

TWST: Let’s move on to the groups that you focus on, starting with ophthalmology, which has received much more attention from the investment community over the past few years.

Mr. von der Luft: There has been an increasing interest in the group. There are certainly a number of companies that are receiving much more attention now than they did a few years ago, and we currently formally follow six companies within the space. We also track a number of others.

TWST: What are the trends that are driving these companies?

Mr. von der Luft: This is certainly a play on the aging of the population, and effective treatments do not exist for a number of eye disorders. There’s a lot of development being done in new glaucoma therapies, for instance, that are more effective and have better side effect profiles. There are new treatments being worked on for age-related macular degeneration, a leading cause of blindness in people over the age of 50. Some companies are also working on new technology to improve the delivery of drugs to the back of the eye.

TWST: How would you differentiate among the six companies in your ophthalmology sector in terms of their current investment attractiveness? And why should investors be looking at them for the second half of 2001 and for 2002?

Mr. von der Luft: It’s interesting in that just as medical technology has a number of different subsectors providing investment opportunities, there are certainly subsectors within the vision care and ophthalmology sector. A number of companies are doing well in the pharmaceutical space, one of which is Allergan (NYSE:AGN), a manufacturer of ophthalmic and other specialty pharmaceuticals. Bausch & Lomb (NYSE:BOL) is a diversified eye care manufacturer and has a presence across multiple vision care sectors. There are also companies that participate in the contact lens arena, which we find are attractive over the longer term. One example would be Cooper Companies. We currently have Buy ratings on Cooper and Allergan. In refractive surgery there is the market leader, VISX (NYSE:EYE), which we have a Hold rating on right now. There are some other new technologies being developed, such as treatments for age-related macular degeneration, and two companies that we currently follow in that arena are Miravant Medical Technologies (Nasdaq:MRVT) and IRIDEX (Nasdaq:IRIX).

TWST: Are there any other companies in that sector that you have rated a buy at this time?

Mr. von der Luft: We continue to like Allergan over the long term and we have a Buy rating on the stock. The company has just launched a new product called Lumigan for the treatment of elevated intraocular pressure associated with glaucoma. We think the drug should be a very meaningful revenue and earnings contributor for the company over the next few years.

TWST: Has it come to the market yet?

Mr. von der Luft: Yes. It was approved in March of this year and a formal launch began in the US in April. So it’s just starting to reach the opthalmologists’ offices. There’s another important driver at Allergan. They manufacture a product called Botox for the treatment of numerous neuromuscular disorders. It has been approved for a few indications, most recently cervical dystonia (painful neck spasms), but a number of physicians are using it for other disorders such as adult spasticity, migraine headache, juvenile cerebral palsy, lower back pain, and hyperhidrosis (excessive sweating). It’s also being used for cosmetic purposes, such as to reduce brow furrow (forehead wrinkles). Allergan also has a hefty pipeline of other products in various stages of development.

This special issue includes:

1) Small-Cap Med-Tech Stocks - In an in-depth (5,000 words) Analyst Interview, Frederick Wise, Managing Director at Bear, Stearns & Co., examines the outlook for the sector and shares specific stock recommendations.

2) Medical Technology: Small Cap Stocks - In an in-depth (3,400 words) Analyst Interview, Hans von der Luft, Senior Vice President at McDonald Investments, Inc., examines the outlook for the sector and shares specific stock recommendations.

3) Small Cap Medical Supply & Devices - In an in-depth (4,100 words) Analyst Interview, Dr. David Gruber, Senior Vice President and Rosanne Ott, Research Analyst, both at Lehman Brothers, examine the outlook for the sector and share specific stock recommendations.

4) CEO interviews (average 2,500 words). Top management of twenty sector firms examine the outlook for their firm and the sector.