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Two analysts and top management from thirty sector firms examine the Private Healthcare sector in this 108 - page Private Healthcare Issue from The Wall Street Transcript available at (212/952-7433) or http://www.twst.com/info/info628.htm

TWST: What has gone on in the biotech arena over the past year or so from a funding point of view?

Dr. Ghodsian: From a funding point of view, we have actually had very strong years, and this has been very positive for the industry. In 2000, we had a record amount of public financing for biotech companies, with over 33 billion raised. 2001 was the second best year for the industry, with about 12 billion in public financing. To put things in perspective, the third best year was the 1996 rally, when the industry raised about 7 billion. The industry has raised close to 7 billion thus far in 2002.

TWST: Where are the opportunities today in the biotech area? What fields seem to offer the most potential?

Dr. Ghodsian: From a broader perspective we can still divide biotech into therapeutics and “tool” companies. Much of the rally in 2000 was attributed to “tool” companies, the genomics and microfluidics, because these companies attracted a lot of crossover funds that wouldn’t normally invest in biotech. Many such funds found the business models more attractive because they didn’t have regulatory approval or long-term drug development risks. The technologies also had some synergies with high tech, which made it more appealing to tech-focused funds. We also saw large electronics and computer companies, such as Motorola (MOT), IBM (IBM), and Hewlett-Packard (HPQ) entering the game by collaborating with biotech. Today the pendulum has swung dramatically in the opposite direction as we see more interest in the therapeutic side. I think at some point this pendulum should stabilize somewhere in between, because clearly there is value in the “tool” companies as well. Nevertheless, many of them, such as Caliper (CALP) and Sequenom (SQNM), are trading below cash. Disappointments from leading genomics companies, such as Human Genome Sciences’ (HGSI) recent failure of two drugs in Phase II trials, have impacted the whole genomics field, and you can find “bargains,” such as CuraGen (CRGN), which is also trading below cash. In the long term we should see this sector rebounding, offering attractive opportunities for investors. Currently, the therapeutic companies offer the most promise, and we see many different promising technologies. Gene therapy is an area that has almost been forgotten, but we are hoping that Avigen’s (Nasdaq:AVGN) hemophilia B data, which is to be partially presented at the American Society of Hematology (ASH) conference, will bring some interest back to the sector

TWST: Of the companies that you follow, which ones do you like today?

Dr. Ghodsian: We have several companies that I think are well positioned. As I mentioned, Amylin has two late stage diabetes products, and they just completed an attractive deal with Eli Lilly that puts them in a very strong position Avigen has a promising gene therapy product for hemophilia and should have some data by the end of the year at the ASH meeting. ID Biomedical is a vaccine company with two attractive products in development, a strep vaccine and a flu vaccine. These are some of the more attractive companies that we are seeing right now.

Funding Biotech Companies - In an in-depth (3,000 words) Analyst interview, Fariba F. Ghodsian, a Managing Director and Director of Healthcare Research at Roth Capital Partners, examines the outlook for the sector and shares specific stock recommendations.

Funding Private Healthcare - In an in-depth (2,700 words) Analyst interview, Carl L. Gordon, a founding General Partner of OrbiMed Advisors LLC, examines the outlook for the sector and shares specific stock recommendations.

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