Wednesday, October 17
Two branches of a Hazlet-based real estate firm will conduct free seminars on foreclosures on Wednesday, October 17, at 6:30 p.m. Representatives from the mortgage division of BetterHomesNJ.com/will also fan out to 17 other offices throughout the state to discuss FHA, VA, and bank-owned foreclosures.
Karen Scarpa will offer the seminar at 1 Rossmoor Drive, Suite 201 D, in Monroe (732-416-3100; fax, 732-416-3101). The office of Darius Rotaru, in the Village Shopper at 1340 Route 206, will also host the forum (609-688-0207; fax, 609-688-0272).
The seminar will help buyers interested in investigating the idea of buying bank-owner and foreclosure properties. It will also include information on how motivated sellers, who are about to lose their homes, might contribute to the buyer’s closing costs.
“Unfortunately, there has been an increase in mortgage defaults, and so it is important for us to have more agents who are experts in dealing with these types of transactions, from the perspective of a home owner or a potential buyer,” says Lawrence Vecchio, broker/owner of BetterHomesNJ.com/VRI Realtors (Home page: www.betterhomesnj.com).
Vecchio started out in the real estate business when he was a messenger, delivering closing papers, and now his company, founded in 1981, has a total of 400 real estate agents.
Just because foreclosures are in the news, Vecchio cautions, does not mean they will flood the market soon. Banks have been instructed to go the second mile with struggling homeowners. And if a homeowner stopped making payments now, it would take 1 1/2 years for that house to come on the market.
Thursday, October 18
Family Trust Planning
What does a 30-year sales clerk of a retail store and his CEO have in common? Both probably have options, stock, or some other stake in the company; and both have no idea of how to transfer it before it’s too late. Charles Aulino, director of financial services for Glenmede Trust Company, which has an office on Chambers Street, sees it constantly. “People come into our office wildly excited about huge pots of cash they’ve just received from retirement, settlements, or liquidation,” he says. “We only shake our heads and wish they had come in sooner.”
What these temporarily nouveau wealthy don’t see coming is that the tax axe is about to slash their windfall to a mere fraction. How to handle ownership transfer throughout one’s career is just one of the topics covered in the New Jersey Technology Council’s panel discussion “Executive Compensation — It’s More Than A Paycheck,” held Thursday, October 18, at 4 p.m. at D&R Greenway, Johnson Education Center, off of Rosedale Road. Cost: $60. Call 856-787-9700 or visit www.njtc.org
Participants include Andrew Gilbert and Amy Kelly of Morgan Lewis; Joe Allegra of the Edison Venture Fund; Mark Sickles, who has a financial consulting firm in Newark; consultant Rose McKinley, and Sririam Iyer, former CEO of Second Foundation in Menlo Park, California.
Author of “Family Trust Planning Guide” and four other related texts, Aulino literally wrote the books on how to handle wealth, be it from salary, partial ownership, or a personally held company. He grew up in Totowa, majored in English at Rutgers University, Class of 1970, and took his law degree at Seton Hall University at night, while working in the trust department of the Bank of New York by day.
After earning a master’s degree in taxation from New York University, Aulino worked for a private law firm doing estate work, then tried his hand as an investment counselor for the A.G. Edwards brokerage company. Then he worked in Richmond, Virginia. “It was a culture shock, moving to the capitol of the Confederacy, and this Yankee really felt it,” he says. Glad to return to the Garden State, Aulino has been advising Glenmede clients for the last 10 years. He also teaches as an adjunct professor at his alma mater, Seton Hall.
The right time to begin planning for wealth transfer is the day you receive your first share of company stock, or first option, or the day your family-held company opens its doors, advises Aulino. “Unfortunately, most CEOs or involved senior managers are spending 22 hours a day trying to increase the company’s value, and they never consider what to do with their personal share,” he says.
Taking the gamble. Restricted stock shares are one of the primary extra-salary compensations used as an incentive. Basically, the employer thanks the employee for helping the company grow by giving him shares in it. But there are strings. Typically, the stock is not released to the employee until, say, another three years of serving the company.
Upon this release date, the employee owes taxes on this stock at the ordinary rate — the same rate paid to the IRS on his annual salary. Up until that release date typically no taxes have been collected on the stock, and in some cases the employee may even have to write his employer a check to pay the social security deduction. The good news here, is, that recipients may pay these taxes before the release date. That is, when they are first promised their 100 shares, and the stock value is at a low 50 cents, recipients may pay off the tax burden — on the $50 — and owe nothing when the price later climbs to $200 a share.
This tax saving technique once made scores of dot-com employees millionaires. Of course, there is a gamble. If the stock value drops by the release date, you may have paid extra tax. Further, if the employee quits before the release date, he forfeits the stock on which he’s already paid taxes.
Learning to trust. Nonqualified stock options, a favorite compensation tool of small companies, often hold the advantage of being transferable, even before they are exercised. Aulino says one of the shrewdest ways to minimize the tax burden is to establish a family trust and move the funds into it. This will involve only a negligible gift tax at time of transfer.
Once within this irrevocable trust, the option, and then, after the exercise of sale, the actual money, stays in the trust. It can be reinvested, passed onto children, and other heirs. Profits are not tax free. If the stocks shows $50 dollars a share profit at the time of being exercised, somebody has to pony up to the IRS. But Aulino suggests that the original owner pay this tax liability on his own 1040 form, at his ordinary income rate. This way, the tax burden is lifted from the trust, meanwhile the owner is spending down his personal income and moving to a lower rate.
Aulino adds one small caveat to establishing such trusts. “It’s all very well to entrust everything to Mother,” he says. “But from that point on, you had better treat Mother very well indeed.”
The ISO trap. If you once listened to the Beatles live on the Ed Sullivan Show, you may remember these compensations as qualified options. But for the last 30 years they have been Incentive Stock Options or ISOs. Like any option, ISOs afford the employee a chance to exercise or buy a set number of shares at a preset rate and sell them again within a fixed period, hopefully when the value has climbed. The exercise, or buy in, price must be set near the fair market price at the time it was granted; (no back dating to give grantees an illegal running start.)
The great, first-glance ISO advantage over nonqualifieds is that option owners need report no taxable income when they first exercise the option. Since you are, in effect buying stock with your own money, no actual compensation needs to be reported.
However, the IRS halts the good news here. The bad news enters in the form of an Alternative Minimum Tax (AMT) adjustment. The spread — that is, the difference between the granted price of option purchase, and the actual fair market value on the date of exercise — is viewed by the tax boys as compensation, and thus actual profit. If your granted option price was $25 for 5,000 shares and you exercised it when the stock was selling for $35 on the exchange, you may owe an AMT of 28 percent of the $50,000 of paper profit from the $10 x 5,000 shares. If you don’t have it, you may have to sell off a big chunk of the option to pay the tax.
In 2001 when the stock market bubble burst, portfolios, packed with stocks worth hundreds per share, quickly plummeted to pennies. Their owners, however, still owed the AMT on the original option grant rate. “I recall one man who had to sell his home to pay the Alternative Minimum Tax on worthless stock,” Aulino says.
Aulino offers a couple of tax-minimizing tricks. First, if the sell dates allow the grantee to wait a year and a day longer beyond the buy date, the paper profit can be transformed to capital gains, and taxed at a much lower rate.
A second method, which Aulino terms AMT Neutralization, involves some very complex figuring, but with some very significant savings. AMT paid in one year may be counted as a credit in the next. In theory, if one’s stock option kept climbing the next year from $35 at the time of exercised option to a price of 50, one can subtract that $10 per share paid in the previous year as prepaid AMT and get it back.
Additionally, Aulino has worked out an intriguing formula that involves selling off regular holdings until they strike a balance with AMT credits. “It’s a process that makes grown CPAs weep, but I see an awful lot of gratified looks on the faces of clients holding such compensations,” says Aulino.
Whether it involves pieces of private or public companies, Aulino sees wealth transfer as a delicate art of timing and amount. Compensation and the resulting taxes have become increasingly manifold in type, with many overwhelming, yet vital choices. “Unless you really love delving into this stuff, I can’t strongly urge enough that people get guidance from their very first piece of complex compensation.” The only other maxim Aulino gives his clients is the one passed down from Joseph Pew, founder of Sun Oil, and father of the founders of Glenmede. “Give your heirs enough money so they will be able to do anything, but not so much that they won’t have to do anything.” — Bart Jackson
Fast & Easy
Every business needs a website. No matter how small your business, your web page is your way of showing the world that you are legitimate, says Elizabeth Niederberger, of ZuMu Software. And today the Internet allows even the smallest company the opportunity to become a worldwide business. One of the secrets, says Niederberger, is a website that is both timely and accurate. Changes must be made frequently to reflect new products and services, pricing changes, and special sales.
Niederberger is the founder of ZuMu Software. Based in Atlantic City, her company specializes in helping schools, municipalities, community organizations, and businesses easily and inexpensively update their websites. For Trenton’s Small Business Week she will speak on “Small Business Websites: What You Need to Know,” Thursday, October 18, at 3 p.m. at the Trenton Marriott at Lafayette Yard, 1 West Lafayette Street. Register online at www.smallbizweek.com or call 609-771-2947.
Niederberger’s company grew out of her interest in technology. “I’ve been playing around with computers ever since I can remember,” she says. She majored in finance at Penn State University, then became a technical writer and eventually opened a desktop publishing business. Her own frustrations with websites led her to look for a better way. At the time she started ZuMu, she says, “you had to learn HTML or at the very least a software program like Frontpage to work on a website.” Many small businesses didn’t even try, relying instead on their website developer to handle all of the updates and changes.
That solution, however, is often too expensive and creates too much of a time lag for the frequent updates that many of her clients require. “Sometimes a school district might need to update their site several times a day,” she explains. While the typical business doesn’t need to update a site that often, for a website to be effective, frequent changes are still necessary. “I kept thinking there had to be a better way,” says Niederberger.
Her company’s solution is web-based. Users must have an Internet connection. They then log-on to the website with a special password that enables them to see the site “just as it is on line” with the addition of a “manage” and “edit” button. They make the necessary changes, then upload them, and the changes “go live” instantly. The beauty of the system, says Niederberger, is that the user doesn’t have to be familiar with HTML or purchase expense software to make the updates, and the system can easily be used by just one person or several people in an organization.
But what changes should you be making to your website? Or for that matter, exactly what material should your business have on its website?
Contact Page. The contact information, not the home page, is what Niederberger sees as the most important part of a website. If a potential customer can’t reach you, how can they purchase your product or service? “It is amazing to me how many businesses forget to put the basic information on their website,” she says. Today, many people are using the Internet the way they used to use the Yellow Pages. Even away from home, they will Google for information on their cell phone rather than dialing 411.
“If they need a plumber, people are no longer looking in the phone book. They are looking on Angie’s List. When they go to a website, people want to quickly find your business name, address, telephone number and e-mail address in an obvious place.” While many people put this information on a separate contact page, Niederberger suggests putting it on the home page as well.
The contact page can also serve as a directory of employees, or if your business is small, the directory can list “departments,” such as customer service, and sales. “The beauty of the Internet is that it can make a tiny company look big,” says Niederberger. “No one has to know that the same two people are customer service, sales, personnel, etc.”
Home Page. This is the front door of your business where you explain to the world what you do. It should give an overview of your products and services and explain your company’s features and benefits. It can also be an excellent place to announce sales, specials, or news about your company. But, Neiderberger warns, make sure that the information is timely. “It doesn’t look very good to have a sale that was over three months ago still showing on your website.” As soon as the information is out of date, remove it, and replace it with new information.
Products/Services Page. What do people really want to know when they reach your website? “They want to know if you have what they need and, if so, how much it will cost them,” says Niederberger. While a lot of companies are afraid to list their prices on the web, she believes that for many businesses, it is essential. Your products and services page should clearly list not only you sell, but its price.
“You should be able to change the prices on your webpage quickly and easily,” as well as post specials and sales, says Niederberger. “A dry cleaner should advertise a weekly sale. A restaurant should always list the menu, with prices, and even daily specials.” While obviously businesses that depend on web sales will post their prices, even a company that never makes an actual sale over the web will gain an advantage by listing prices, she says.
About Page. The about page is the place to tell people more about your business. Most business websites use the About page for short biographies of company owners and major employees. Niederberger suggests it can also be used to give even more information about the business. A beauty salon could post photos of hairstyles, for example. A landscaper could use the page for pictures of homes or businesses he has designed.
While much of the information on a website used to be found in a company brochure, business should remember that the website is so much more than static printed material. A website is an active selling tool. To be effective, it must always be changed on a regular basis. —Karen Hodges Miller
Real World Theses
A college student’s senior thesis, often on an arcane subject, generally evokes a big ho hum. But at DeVry University, where real-world applications reign, this year’s array of senior projects includes an antidote to sleep — an automatic sleep detection alert system.
Corporate representatives are invited to come and inspect this year’s crop of senior projects at the showcase on Thursday, October 18, from 8 a.m. to 5 p.m. at 630 Route 1 North in North Brunswick. For information call Deborah Helman at 732-435-4880, extension 3591, or E-mail: email@example.com.
The senior project is the capstone for DeVry’s bachelor’s degree. Working in teams for six months, they examine a problem, develop possible solutions, and implement the best one to put together a project that uses management, technology, and business concepts.
Each team has an industry client. DesignWrite at Research Park has been a partner client, as have Panasonic, Verizon, Middlesex Regional Chamber of Commerce, Highland Park Glass, a first aid squad, and a police department.
The sleep detection alert system, which was developed by electrical engineering students in Chao-Ying Wang’s class, uses a heart monitor and movement sensor. Another group used similar technology for an automobile accident prevention system that monitors both the driver and the immediate surroundings for potentially dangerous activity.
Other projects involved a medical clinic, a piano store, a karate academy, and an Irish import store. For a jewelry business, students created a line of beads that can be collected and personalized.
Meet the Consuls
More than two dozen companies are scheduled to meet and greet representatives from foreign consulates on Thursday, October 18. Raritan Valley College’s international center hosts this gathering for the fourth year.
“Commercial officers of foreign consulates come from the embassies in New York,” says RVCC’s Ellen Lindemann, “and some invite their colleagues from Washington. We teach them about life sciences in the state so they can about doing business in New Jersey.”
Sylvester Di Diego, founder of Strategy Dynamics LLC and the conference chairman, calls the program “unique in stimulating economic growth. Without boarding an airplane,” says Di Diego, “New Jersey leaders have a unique opportunity to meet right here in New Jersey with officials from Australia, Belgium, Canada, China, Czech Republic, France, Germany, Hong Kong, India, Indonesia, Italy, Japan, Korea, Malaysia, Romania, Slovakia, Taiwan, and many other economies that are expected to attend.”
Morning sessions start at 9 a.m. at the college in North Branch, followed by a luncheon at the Stanton Ridge Country Club in Whitehouse Station.
A session on “Expansion of Life Sciences in New Jersey” features speakers from Bayer, Eisai, Novo Nordisk, and the Biotechnology Council of New Jersey. One entitled “Incubation and Commercialization in New Jersey” features Eli Mordechai of Medical Diagnostics Laboratory and the Genesis Project, plus representatives from the Rutgers Food Innovation Center and Rutgers’ WIRED Program.
Though the conference is open to the public, Lindemann cautions that attendees must preregister at www.raritanval.edu/cibe/events.htm or call Lindemann at 908-526-1200, ext. 8348. Cost: $45.
When it comes to starting an enterprise, nothing helps like good advice. The Princeton University Center for Innovation in Engineering Education has scheduled a series of free workshops, “Harnessing the Power of Entrepreneurship,” aimed at community members as well as to those on campus.
Led by entrepreneur and business school professor Julian Lange of Babson College, these workshops focus on how entrepreneurial techniques can be used — not in starting a business — but in other ways, such as in government, in corporations, and economic development.
Francis P. Pandolfi will speak on Thursday, October 18, at 4:30 p.m. at Princeton University’s Bowen Hall on Prospect Street. While telling how to apply entrepreneurial principles to non-profits and non-governmental organizations (NGOs), he will cover how to define and implement objectives, how to develop and use metrics, how to use technology to leverage resources, and what the trends portend.
A 1965 Princeton University graduate, Pandolfi has been the chief operating officer of the U.S. Forest Service and the former CEO of Times Mirror Magazines.
Friday, October 19
Even now, 20 percent of the world’s population needs clean water and adequate housing, and 40 percent do not have sanitation. Twenty years from now, 2 billion more people will be on this earth. To make matters more difficult, developing or underdeveloped countries will produce 95 percent of the population growth.
So in 2027, there could be a shortage of energy, food, land, water, transportation, materials, waste disposal, earth moving, health care, environmental cleanup, telecommunication, and infrastructure.
Bernard Amadei, founder of Engineers Without Borders, believes a new generation of engineers needs to meet these challenges. Amadei speaks on Friday, October 19, at 4:30 p.m. in Room 6 of Princeton University engineering school’s Friend Center on Olden Avenue.
With degrees from the University of Toronto and the University of California, Berkeley, Amadei is writing a book called “Engineering With Soul.” He will also discuss the need to integrate engineering with non-engineering disciplines to help build a more sustainable, stable, and equitable world.
Pizza will be served after the talk, which is sponsored by the Center for Technology in Developing Regions, the School of Engineering and Applied Science, and the Princeton Institute for International and Regional Studies.
Monday, October 22
For Pharma Insiders
Princeton is one of five worldwide sites where Thomson Scientific is staging an invitation-only users’ conference, called Pharmaceutical Vision, scheduled for Monday, October 22, at the Westin in Forrestal Village. The same meeting has been already been held in London, Paris, and San Francisco, and it goes to Munich at the end of the month.
“The way businesses are organized is changing, and we need to develop more specific products and solutions for those at the heart of discovering new medicines,” says Jon Brett-Harris, executive vice president of pharmaceutical and chemical markets at Thomson Scientific, in a telephone interview from London. “The keynote speakers and sessions will spark discussion, create a forum of creativity, and allow the real experts — the end-users — to provide feedback.”
Most of those attending will be current clients, but professionals in the pharma and biotech fields can contact the organizers for an invitation (http://scientific.thomson.com/fr/pharmavision).
The Thomson Corporation, headquartered in Stamford, Connecticut, offers electronic workflow solutions — value-added information, software tools and applications — to those in the fields of law, tax, accounting, financial services, scientific research and healthcare. Thomson has about 90 workers in patents and licensing for electronic brands on Independence Way and about 100 workers in Thomson Prometric on Lenox Drive. Thomson Scientific has 528 employees in Philadelphia, plus about 50 in its office in Horsham.
About 40 clients came to the San Francisco meeting and because most of the pharmas are on the east coast, Brett-Harris expects many more in Princeton. Brett-Harris chose this location because it is central to the corridor and has good transportation links. The last conference will be in Munich.
Brett-Harris wants to highlight some significant additions to the product line and he wants customer feedback. “We want to converse with our customers on a regular basis,” says Brett-Harris. “We are trying to drive interactive discussions using a format based on small workshops and feedback sessions.”
Born in south Wales, Brett-Harris majored in psychology and economics at the University of London, where he also obtained his MBA, and he has had 20 years experience in the pharmaceutical industry on both sides of the Atlantic. He is executive vice president of the pharmaceutical and chemistry markets strategic business unit for Thomson Scientific.
Thomson Scientific publishes nothing, but it indexes nearly everything. “We are not just a database with a search capability; we add significant value to the content we own,” Brett-Harris says. “We have experts in abstracting and indexing literature, to help clients to see the wood for the trees. It’s about generating an integrated work flow.”
For instance, Thomson might help a client to be more productive by offering in-depth research on how to be more effective in conducting clinical trials in third world countries. It could provide data to help select potential trial sites — telling where certain pools of patients may be, figuring out the success or failure rates of potential sites around the world. “We are experts at compiling the information — what a new product or solution involves — and bringing editorial expertise to bear on that data,” says Brett-Harris.
Its competitors are broadbased providers of information, such as Reed Elsevier. “But for the pharma and biotechnology market, very few organizations can provide the breadth and depth of information that Thomson Scientific has,” he says.
Featuring hands-on demonstrations of the newest workflow solutions, the conference aims to attract a broad range of professionals — biologists, chemists, competitive intelligence experts, regulatory affairs experts, and specialists in marketing and business development.
For instance, the information professionals track will include discussions of two patent indexes, a new release, and an overview of the bioinformatics market. Perhaps most important will be a session on how to get one’s managers to pay for the information. It tells how to “manage up” (shifting information up to the person in charge to gain commitment) and how to enlist champions through an understanding of their personality styles. Similar tracks are scheduled for regulatory affairs and competitive intelligence specialties.
All sorts of pharma occupations might turn to a scientific database — bench scientists, brand managers, medical information officers, competitive intelligence specialists, business development consultants, and, of course, librarians. “We touch the needs of all the users,” Brett-Harris says.
For instance, business development specialists might go to Thomas Pharma to understand how a product in development needed to be positioned or marketed. To understand the competitive landscape, they need to do a drug pipeline search process, finding out what drugs are in what stages of development. They need to find out what doctors are saying about the products, evaluate the competitors, and make forecasts.
Biologists, working on projects at an early stage, would use the same databases to understand how a biological target was positioned, to explore biological interactions, and how a particular target might react within a particular therapeutic field.
Says Brett-Harris: “We are very proud of what we are doing right now. This series of meetings is a two-way transaction.”
Tuesday, October 23
New Jersey is a “perfect storm” for bioenergy production, says Tana Kantor, CEO of the Clear Canopy at 20 Nassau Street. The state has all the right elements — urban density, abundant transportation and shipping infrastructure, land available for siting plants, and ready access to a large market. Meanwhile gas prices are rising and green causes are basking in the reflected glory of the Nobel Prize that was awarded to former vice president Al Gore.
The Perfect Storm Bioenergy Forum, set for Tuesday, October 23, from 7:30 a.m. to 6 p.m. at the New Brunswick Hyatt, will focus on the opportunities and challenges for bioenergy in New Jersey. Cost: $160. Call 609-520-0056 or visit www.thegreeneconomy.com/event
Kantor, who is helping Rutgers stage the conference, hopes to attract those with business, regulatory, and financial interests. Her targets: To reduce greenhouse gas emissions by 20 percent, bringing them to 1990 levels by 2020, and to reduce these emissions to 80 percent below 2006 levels by 2050.
Priscilla Hayes of the Rutgers Solid Waste Policy Group is a panelist for a future technologies panel entitled “Not Just Corn Ethanol.” Keith Lynott of McCarter English and Laurie William of the New Jersey Governor’s Office of Economic Growth are among those who will discuss government policies to promote bioenergy. Richard Pinto of Stevens & Lee will moderate a panel “Successes and Obstacles to Bioenergy. Sharing their successes will be Steve Paul of Trenton Fuel Works and others. Bruce Kahn of Smith Barney and Ralph Taylor-Smith of Battelle Ventures will contribute the venture capitalist’s viewpoint, and another panel will focus on siting new facilities.
Wednesday, October 24
The Facts On Factiva
Princeton Public Library is the lucky home of three licenses to the Factiva database, a premier news source usually available only in the offices of the deep-pocketed elite. Most libraries can’t afford it, and Cynthia Lambert, who worked until quite recently for the Dow Jones index department, knows of only four academic libraries on the east coast that have it. That it is available at Princeton Public Library, she says, “is due to Dow Jones’ generosity and neighborliness.”
Though Factiva is too expensive for libraries, it is licensed to 80 percent of Fortune 500 companies and 100 percent of pharmaceutical and related industries — and probably many investment analysts.
Lambert’s workshop on Factiva is featured this month in Princeton Public Library’s Data Bytes. Her October 10 workshop attracted 10 people, including this reporter. She repeats the session on Wednesday, October 24, at 1 p.m. Call 609-924-8822 for information.
Factiva, a joint venture of Reuters and Dow Jones, was developed in response to the success of Bloomberg’s newswire, which concentrated on business news. Bloomberg began to deliver stories directly to investors and corporate people, through a box, the Bloomberg terminal, they had to purchase. Factiva, though, would have a different delivery mechanism — the Internet.
Factiva provides not only the Dow Jones and Reuters news wires but also access to 10,000 publications as well as websites and now blogs. “It keeps getting bigger,” says Lambert, “unlike Bloomberg, which is purely business.” Factiva provides information from a variety of sources, ranging from “American Cheerleader” to “Zymurgy,” a publication for beer enthusiasts, and it runs the gamut from entertainment news, to political news, both national and global, using sources in 23 languages.
Lambert, a financial analyst for 10 years at Bloomberg News and Dow Jones, grew up in Hamilton where her mother was a homemaker and secretary, and her father was an undertaker at Peppler Funeral Home in Allentown.
She stumbled into finance while she was working part-time and going to school. After she got an administrative job at U.S. Trust Company, an investment management firm, she had the option of having schooling paid for as long as it was related to her work. So she majored in finance at Rider University, graduating in 1996.
Although Lambert enjoyed working in finance, she had always wanted to be a librarian. So with the encouragement of her husband, she started working for her degree in library science at Rutgers. “Librarians made such a huge impact on me when I was a kid,” she remembers. “They were among the nicest, smartest, and most well-read people, and I thought it was the greatest thing to be surrounded by books all day long.” She will receive her master of library science degree from Rutgers School of Communication, Information, and Library Studies in May.
Although Lambert clearly loves the Factiva database, she admits that “it is not the friendliest of interfaces.” The database is very large, and it takes some learning to be able to use all its features to construct searches that bring back the desired information.
Searches are crafted in the “free text box” at the top of the home page. To explain the basics, Lambert looks for information on a product just announced by Microsoft where medical information can be put into a database on a secure server that can be accessed by doctors, insurance companies, and healthcare providers.
When she enters “Microsoft” in the box, Factiva searches all English-language publications from the last three months, and she gets 35,970 hits, too many to scan for her information. To reduce the number of hits, she uses several Factiva features:
The “exclude” feature at the bottom of the page. Using this feature, she checks “recurring pricing and market data,” which she says usually knocks out about 950 stories from a search of a popular company. (It is also possible to exclude republished news as well as obituaries, sports, and calendars.)
Boolean operators. Because Microsoft had also just announced a new video game, Halo, she uses one of the Boolean operators (and, or, not) and types “Microsoft not Halo,” which excludes any stories with the word “Halo.”
Codes. To narrow the search further, to the medical field only, she might have simply entered “medical” in the free text box — but that would have included stories about other medical companies where Microsoft is mentioned as an aside. So instead she uses the code “HLP” with the word “medical” to indicate that “medical” appears in either the headline or the lead paragraph. By typing “Microsoft not HALO and HLP=medical,” she has reduced the number of hits to 264. (To limit the search only to stories on page 1, she could have typed “PG=1.” Or to make sure that Microsoft was mentioned at least five times in the article, she could have typed “atleast5.”)
In Factiva a search can be limited by source, company, subject, industry, region, and language.
If limiting a search by source, for example, you can select the “New York Times” and click on the “I” (information) button next to it, you can select on articles by specific journalists; if you want to see a list of Maureen Dowd’s columns over the last three months, for example, you would select her name and the code “by=Dowd” would appear automatically in the free text box. “Databases have built-in biases,” notes Lambert. “You have to use all the information you already know, and in a database built by journalists, it’s all about the byline.”
Company searches require a ticker symbol, which you can find by entering part or all of the company name. A benefit of starting with a company’s name instead of its symbol is that you will get a listing of the company’s subsidiaries as well as its ticker symbols on different exchanges around the world.
Perhaps the most amazing feature of Factiva is the comprehensive information it provides on over 42,000 companies, primarily those publicly traded but also private companies with significant influence on the economy. The following information is available for each company:
A good general report on the company
Names of all senior executives
Most recent financials, which in the United States means quarterly reports (these generally lag two quarters although the most current ones are available in the “news” section). If you click on “spreadsheet,” you can download to Excel information from balance sheets, cash flow, and income statements as well as a price history. The data in this history, however, has been adjusted for splits, share buybacks and stock dividends that have affected the stock price.
Peer groups, which represent companies with similar levels of sales in the same general industry.
Competition, those companies in direct product competition.
20-minute delayed stock quotes
Significant ratios, like earnings per share or price-earnings ratio.
Interactive chart of price changes over the last three months (which can be changed to cover the last five years). These charts have two advantages: the first is that you can add charts of other companies or an index for comparison, and the second is that if you can click on a point in the chart, for example, a spike, you will get all the news about the company for the day it occurred.
News about the company
Press releases. As Lambert notes, “This is what a company wants you to notice. It is a good way for investors to see what is happening without journalistic involvement.” Then they have a basis for judging the spin put on the information in the release by a newspaper or an analyst.
Once you have located the sources you want, you can print them, save them to disk, or E-mail them to yourself.
Lambert recommends clicking on the “support” button for help with Factiva. You can find quick reference cards in different languages, lists of source codes, and company research tools.
Her excitement about Factiva is shared not only by her former business associates but also by her colleagues in the new career she is about to begin in library science. As Janie Hermann, a PPL librarian, says about Factiva: “Our librarians would feel lost without it.”
— Michele Alperin
End Run Around the FDA
In a forum geared to help biotechs do clinical trials, the chief scientific officer of TyRx Pharma will take the contrarian position: Try to avoid clinical trials if you can. And if you play your cards right, you can do an end run around the expensive clinical trial process.
Instead, get the product approved and start generating revenues, says Arikha Moses. “You can do this if you involve everyone — regulatory, business, marketing people — in the product concept right from the beginning,” she says.
Arikha (pronounced Ah-ri-ka) Moses speaks at a workshop set for Wednesday, October 24, at 8:30 a.m. Entitled “Clinical Trials: Do it Right the First Time,” it is being staged by Biostrategy Partners at the EDA Commercialization Center, 675 Route 1 South in North Brunswick. Cost: $40. Register at www.biosp.com or call 609-203-6852. Also on the program are Robert Alonso of Yaupon Therapeutics, Arthur Gertel of Beardsworth Consulting Group, Jeffrey H. Nicholas of Fox Rothschild, and Nicholas U. Spring of Topaz Pharmaceuticals. They will offer perspectives and practical advice about how to position a company for success in trial design, partnering and financing trials, and how successful trials will affect a company’s valuation.
TyRx, based on Deer Park Drive in the Princeton Corporate Plaza, is the first company in 15 years to get a product approved with a new biodegradable polymer. With 27 employees, TyRx Pharma focuses on biodegradable polymers that attach drugs to medical devices, for instance, cardiovascular stents and surgical barrier devices, such as those used for hernia operations (U.S. 1, March 18, 2005).
Moses says she learned to love science at a very young age. “I like to be constantly challenged and think about complex problems.” Her father was a physicist in a government laboratory at Johns Hopkins and her mother a musicologist at the Library of Congress. She majored in chemistry at Brandeis and has a PhD in bioorganic chemistry from Yale. She is married to an attorney, an intellectual property litigator, and they have a four-year-old daughter.
Rather then go into academe, she wanted to be involved in “growing science,” so she joined Athena Ventures, a seed stage venture capital firm focused on medical devices. Her job was to look for new technologies, and she was intrigued by the work of Satish Pulapura, done in the lab of Joachim Kohn at Rutgers University — tyrosine-based resorbable polyarylates — to use on permanent implants. “Joachim really got me excited about the need for new material to be approved for use in the body,” she says.
Athena shut down. But some of Athena’s investors backed her with a couple of million dollars to start TyRx, then called Advanced Materials Design, in 1998. “I did a lot of things by the seat of my pants,” she says. Moses founded the firm and was its first president. When William Edelman joined the firm as CEO in 2004, the firm opened a laboratory on Deer Park Drive and she became CSO.
TyRx products for soft tissue repair can be used for anything from preventing infection to reducing scar tissue. Two of its anti-microbial surgical mesh products have been approved, and just after they went to market they were bought up by Bard/Davol, a big player in the hernia surgery market. Its stents, developed in conjunction with Boston Scientific, have not yet been used in humans.
TyRx expects to get FDA approval for an anti-infective pouch for cardiac pacing devices by the end of the year. “We’ve designed a resorbable pouch to go around the devices to prevent infection,” says Moses. The pouch biodegrades after it is no longer needed. “Most people, if they get infections, get them in the first year, due to contamination at the time of surgery,” she says. The TyRx coating is “agnostic” to the device; it can be used on any of them.
Position your product to avoid clinical trials, she suggests. Drugs, such as gene therapy drugs, often take 10 years to get their FDA approvals, which could cost $50 million.
So if your product has a medical device component (like the TyRx cardiac pacing device) and a pharmaceutical component (like the tyrosine-based resorbable polyarylate coating), take it to the FDA as a medical device. Medical devices can navigate the FDA swiftly if they can be proven equivalent to an existing device.
The TyRx product went through approvals based on benchtop testing and animal testing and has not yet had clinical testing.
But invest in voluntary clinical trials for marketing reasons. “Without good clinical data, at first, you won’t get good market penetration,” Moses says.
That’s why, in the next six months, TyRx will put the pacing devices into voluntary clinical trials to prove effectiveness in humans.
Asked why she agreed to participate in this panel, Moses says she has a soft spot in her heart for entrepreneurs. “They are really smart people,” she says. “I know what it’s like. Consider it the start of my mentoring career.”
— Barbara Fox