A textbook example of a company that is difficult, if not impossible, to value is Human Genome Sciences Inc. of Rockville, a pioneer in using large-scale analysis of human genes in medical research.

The company is widely perceived as being one of the leaders in its field, known as "genomics." It has been in business since 1992, but Human Genome is still in a start-up phase and loses millions every year. It is likely to continue doing so for some time.

That hasn't stopped investors from bidding the stock up to lofty heights over the past year. Human Genome closed at an all-time record of $159.56 1/4 a share on Dec. 30 and traded even higher during the day, amid a broad run-up in biotechnology shares. It dropped along with other technology shares early last week but has been edging back up since, and is trading at triple the level of six months ago. The company announced a 2-for-1 stock split effective Jan. 31.

What is the stock really worth? It's not an easy question, but one answer may lie in the number of patent applications the company has filed since it began operations. Human Genome has patents pending on some 7,400 genes -- about 5 percent of all human genes -- discovered by the company, giving it one of the largest "patent estates" among biotechnology companies.

The company has tried to zero in on the most important genes, notably those that help tell cells when to grow or stop growing.

The work has led to promising animal tests, and three compounds have moved into human testing. One substance discovered by Human Genome seems to promote rapid healing of skin wounds, intestinal inflammation and other ailments. Another seems to promote the growth of new blood vessels, a potentially revolutionary treatment for heart disease or certain complications of diabetes.

It's hard to believe there will be nothing useful in all the research, but it's certainly possible that the drugs Human Genome is developing won't live up to expectations. At the other extreme, a fair percentage of Human Genome's patents could turn into blockbuster, billion-dollar drugs, a development that would make today's stock price look cheap.

Small investors who hold the stock tend to acknowledge that they don't have any real idea what it's worth. But they do have a gut instinct that the company will be important in the future of medicine. Gregory Freerksen is a lawyer in Chicago who favors "conservative" investments like the John Deere tractor company. His biggest play on the so-called New Economy is a small stake in Human Genome.

"Owning a part of this company makes me feel like an explorer," he said in an e-mail, referring to Human Genome by its ticker symbol, HGSI. "The idea that HGSI could patent whole gene sequences by simply discovering them is amazing. It struck me that it was like Christopher Columbus heading out to the new world and sticking the Spanish flag into whatever island or continent he found."

For 2000, the key developments to watch revolve around human tests of the company's drugs. Some results should be available by midyear, particularly on the wound-healing drug. If those results are positive they would likely give the stock another big boost.

Conversely, Human Genome is at such a critical stage that any bad news about these earliest drugs would likely be taken by the markets as a big negative. Start-up biotechnology companies have seen their stocks collapse on the basis of a single testing setback.