Club Biomed &endash; Meeting Minutes &endash; 21 May 2003

Welcome and monthly contribution collections.

Carlos reported on the status of Club Biomed's real portfolio. Shares are now worth $25.93. We are in the black! Regeneron rebounded from a loss to a 14% gain but TEVA is up about 21%. PFE gad moved into positive teritory, but lost ground because of the main court decision.

John briefly reported on the circumstances of the Clubs purchase of Regeneron and the recent price rebound. He said it was a sympathetic rebound reflecting the success of DNA with an anti-angiogenic drug. Neil felt it also reflected revised and more positive thinking about Axokine.

John reported on our indexes. Mutual funds (-3.6%) Virtual one (up 124%!!!!). Random Walk (up 12%)

We spent 25 minutes talking about sell diciplines and each partner expressed their view of how to decide when to sell a company. There was a broad diversity of opinion including:

• When a stock has gained value,
• When it has lost value (i.e., price),
• When it has not moved.
• When the market conditions are bad,
• When our reasons for buying it have been realized,
• When we have a more productive use for the money,
• When it is overvalued,

John shared the list of reasons to sell or not sell from our books on investment clubs. These included:

• Is the stocks future is fading fast?
• Are you being rash, emotional or reactive?
• Will the sale effect diversification?
• What are the tax ramifications?
• Are you selling because of the market--or the industry?
• Is the stock overvalued or undervalued?
• Are you cutting your flowers and letting the weeds grow?
• Are you selling just because the stock's price has gone up?
• Do you have a better use for the money after you sell?
• When selling to pay off a member withdrawal, have you considered all the options?

Investment Clubs for Dummies

• Consider costs (commissions, etc.)
• Adverse management change
• Declining profit margins
• Deteriorating financial condition
• Competition is effecting profits
• Dependence on a single product
• Economic circumstances change
• It is a cyclical and the economy has peaked
• To maintain balance by company size (or category)

After discussion, we decided to:

1. 1. Put discussions about whether to sell a stock on the agenda periodically (about every other month).
2. 2. Notify the membership if any member feels a stock should be sold and the reasons for this feeling.
3. 3. Try to make sure that the 'stock-watcher' is available and can answer questions at a meeting where a decision to sell was to be considered
4. 4. To continue the process of establishing a sell discipline.
5. 5. To send out a questionnaire to members to try to establish the tolerance for risk of the partners (Neil will draft a questionnaire).
6. 6. To explore the possibility that we should keep cash in a vehicle other than a money market account (i.e., a bond fund, a REIT, a commodity?). (Do we have a volunteer to tackle this one?

Stock Presentation: The presentation of IDPH was begun, but time prevented completion of the report or consideration of the buy recommendation.

We decided to add IDPH to Virtual one.

Planned Agenda items for June meeting includes:

• Finishing up IDPH
• Initiating a discussion of TLRK
• Establishing a 'sell discipline.'
• Deciding whether to buy or keep PHE.

Planned Agenda items for July:

• Results of the questionaire
• Finishing TLRK
• Deciding whether to buy--IDPH or TLRK??
• End of the first year celebration.

-- submitted by John Wagner