January 26, 2005

Martin Scorsese's The Aviator takes lead in Oscar race with 11 nominations, including best picture, best director Martin Scorsese) and best actor (Leonardo DiCaprio); Finding Neverland and Million Dollar Baby receive seven nominations each, including best picture; nominations listed; photos (M)

Stewart Rahr's new $45 million East Hampton estate, most expensive house ever purchased in New York, reflects fortune made by 58-year-old law school dropout who turned wholesale drug purchasing into game of arbitrage; Rahr took over father's Brooklyn pharmacy 36 years ago and built distribution business on speculative buying, betting on manufacturer price increases; drug middlemen like Rahr, knowing that manufacturers typically increased prices at same time made millions by overstocking in advance, selling drugs at higher prices short time later to retail pharmacies; Rahr's company, Kinray, honed practice with computer program; distribution industry is dominated by three large public companies, AmerisourceBergen, Cardinal Health and McKesson; Goldman Sachs estimates three made 60 percent of profit, $980 million, when speculative buying was at peak in 2001; drug makers relied on speculative buying in lieu of paying distributors, but practice fostered many problems, including drug cost inflation and spot shortages; SEC case against Bristol-Myers Squibb, which paid $150-million fine, shifted industry away from practice; Rahr says Kinray will prosper anyway, expanding to other health products and generics (M)

New York City transit officials say service on A and C subway lines could be fully restored in six to nine months, much faster than earlier prediction of up to five years to repair damage from fire in signal rooms near Chambers Street; months of confusion and inconvenience still seen, underscoring vulnerability of signaling system based on electromechanical switches first developed in 1870's; diagram explaining complex, antiquated system; New York City Transit president Lawrence G Reuter says relays are being salvaged from other work; explains stopgap service; former transit director David Z Plavin says issue of obsolete signal system has been known for decades, but nobody could figure out how to replace it without shutting down major portions of service, and more immediate safety needs took priority; new capital plan requests funds for computerization and upgrading (M)

Peter Applebome, in Our Towns column, holds that it is hard to think of proposal with more potential to transform area than proposal to bring casinos to Catskills; contends that many Sullivan County residents want referendum on proposal; notes that critics say county, with its booming real estate market and growing economy, is doing fine without casinos (M)

Gov George E Pataki, seeking to reward colleges that graduate students 'on time,' proposes giving colleges $500 for each student who earns bachelor's degree in four years and $250 for each student who earns associate degree in two years; incentive plan is aimed at reducing money students and taxpayers spend on higher education; SUNY and CUNY will be required to participate in program; private and nonprofit colleges will be allowed to join (M)