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Leading analyst examines the genomics & gene-based therapeutics sector in this special Genomics & Gene-Based Therapeutics report from The Wall Street Transcript, available at (212/952-7433) or http://www.twst.com/info/info555.htm.

TWST: Will you begin by telling us about the sector that you cover for Ladenburg Thalmann?

Mr. Rauch: I focus on genomics, antibody therapeutics, and gene therapy companies in the biotechnology sector. In the genomic area, I am focusing on companies that are developing new therapeutics.

TWST: How much do investors need to know about the science behind the evolution of genomics and gene-based therapies and proteomics into areas of investment?

Mr. Rauch: Right now, I don’t think that understanding the science is key to investing in these areas. Investors should be focusing on the products of these companies, because the products are driving valuation. The key to understanding these products is the potential markets that they are hoping to address and the potential medical need they may be addressing.

TWST: What are some other names that you particularly like at this point?

Mr. Rauch: Another company we like is IDEC Pharmaceuticals (Nasdaq:IDPH). They’re a profitable company that’s marketing monoclonal antibodies for the treatment of cancer. They have two products on the market right now. This is an example of a company that has taken a technology platform, antibody therapeutics, and successfully developed it and commercialized it into products. The company has produced some great returns for investors. We see the growth in these products continuing, as the company is an expert at developing antibody therapeutics.

TWST: I understand there are always risks with these stocks. But apart from the inherent volatility, is there anything specific with IDEC that investors should be aware of?

Mr. Rauch: Once a company is profitable, the biggest risk is a decrease in the growth of the revenues or even the loss of revenue. A variety of scenarios is always possible. Failure of the pipeline to support the growth of revenue, competitive drugs, and litigation are all possible but not consider likely or immediate for IDEC. Its lead drug, Rituxan, is doing very well, and is entrenched in the medical community. Zevalin, a follow-up product, is also likely to do very well.

TWST: What are the signals that indicate problems at a company and might cause you to stay away from a stock?

Mr. Rauch: I am cautious about companies that are still developing a technology. The probability of successfully developing a new technology and the time it will take are almost impossible to estimate. Therefore, they are difficult to value. I try to wait until there is a proof of concept that a technology will work before I get too deeply involved with a company.

TWST: What would your overall message be to investors who are looking at this sector today? And are you finding mainly seasoned healthcare investors and healthcare funds looking at these stocks?

Mr. Rauch: People are rather hesitant to get into stocks when they’re not too sure when things are going to return to normal in the future. We are looking for reasons to sell rather than reasons to buy. We think this is the reason these stocks are depressed and it represents a buying opportunity.

This special report includes:

1) Genomics & Gene-Based Therapeutics - In an in-depth (2,400 words) Analyst Interview, Albert Rauch, Analyst and head of healthcare equity research at Ladenburg Thalmann & Co. examines the outlook for the sector and shares specific stock recommendations.