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Since the last Newsletter we closed only one position for a very nice gain.
BIOMIMETRIC THERAPEUTICS (9/20/11). Closed position 11/19/12 at $7.34 for a 98% GAIN.
This seems to be happening more than usual as a big company swoops in on one of our Current Portfolio picks and its fun time! It was nice to get almost a 100% gain as Wright Medical acquired BioMimetric Therapeutics.
The last several weeks in the market have been a gut-wrenching roller coaster ride, and we suspect there will be many more loop-de-loops over the next few months. Of course, the approaching Fiscal Cliff deadline is the main culprit, for now. Then, once there is a resolution, the devil will be in the details. So hang on tight as we watch American Roulette in action. Oh, and let us not overlook the market’s reaction to the next Treasury Secretary, whoever that may be.
Here are the headlines since the last Newsletter about companies in the Current Portfolio; dates in parentheses are when we first recommended them. We are not giving updates about companies on the “Endangered List” unless we feel the news to be highly significant.
Limelight Networks (LLNW)(11/20/12). Names interim CEO who was formerly with Convergys.
Lionbridge Technologies (LIOX)(11/5/12). To acquire crowdsourcing services company Virtual Solutions.
Response Genetics (RGDX)(10/20/12). To present at the Canaccord medical technology forum on December 4, the day after we post this Newsletter.
Anthera Pharmaceuticals (ANTH)(10/5/12). Presents data from Phase 2b PEARL-SC study.
Zynga (ZNGA)(10/5/12). Several dozen news stories and articles; one of the more notable being that it amends terms with Facebook.
SemiLEDS (LEDS)(8/20/12). Quarterly numbers disappoint; balance sheet still looks strong. Files notice of late filing.
pSivida Corporation (PSDV)(8/5/12). Reports patient access scheme being developed by Alimera to address cost concerns following negative final draft guidance by UK’s NICE for ILUVIEN for DME.
Vermillion (VRML)(6/20/12). Medical journal publishes new clinical study showing positive performance of OVA1 ovarian cancer test. Names interim CEO. Judge dismisses dissident shareholder suit.
Avanir Pharmaceuticals (AVNR)(6/5/12). Recent cash position seems to be pretty healthy as company comes out with preliminary quarterly results.
Capstone Turbine (CPST)(5/20/12). U.S. Embassy host CPST event for 45 leading Argentinian oil and gas executives.
AirMedia Group (AMCN)(4/20/12). Recent numbers aren’t great on the bottom line; balance sheet still looks good.
Echo Therapeutics (ECTE)(3/20/12). To present at the Canaccord confab on December 4.
Ballard Power Systems (BLDP)(3/20/12). Joins with Nokia Siemens Networks to develop fuel cell backup power for mobile networks.
Anadigics (ANAD)(11/20/11). Introduces new small-cell wireless infrastructure power amplifier. Needham upgrades stock to a “buy”.
ECOtality(ECTY)(11/5/11). Latest numbers look okay; balance still looks good, but could use some more cash.
On Track Innovations (OTIV)(6/20/11). Recent numbers look pretty good, as does balance sheet.
NeoStem (NBS)(5/20/11). Awarded NIH $1.2 million grant for VSEL development.
Jamba, Inc. (JMBA)(3/20/11). Announces expansive California development plan.
Oculus Innovative Sciences (OCLS)(3/5/11). To create subsidiary for their anti-infective drug assets.
Astex Pharmaceuticals (ASTX)(12/5/10). Announces oral presentation of SGI-110 results from Phase ? MDS and AML study of ASH.
Inovio Pharmaceuticals (INO)(10/20/10). Claims that its Cytomegalovirus synthetic vaccine constructs generate strong and broad T-Cell response for preclinical study.
Prophase Labs (PRPH)(10/5/10). Establishes 2.5 million share equity line.
NovaBay Pharmaceuticals (NBY)(4/20/10). To present at the LD Micro Conference on December 6.
Our picks for this Newsletter are an AMEX-listed biopharma and a diagnostics developer that is NASDAQ traded.
PALATIN TECHNOLOGIES, INC. (AMEX: PTN) – 69 cents. Twelve-month hi-low has been $1.20 – 39 cents. Located in Cranbury, NJ, with about 15 employees, this biopharmaceutical has 39.9 million shares outstanding, $34.34 in total current assets, $34.7 million in total assets, little debt, and $1.71 million in total liabilities. Institutional ownership is around 53%. Two analysts rate the stock a “buy”. www.palatin.com
If you study out Track Record for a few hours, Palatin Technologies, Inc. pops up somewhere for a positive gain, as we recall. The company has fallen on hard times, since then, but seems to have had a rebirth, of sorts, with a hefty infusion of cash and some recent upbeat news on its main product candidate. And yes, this is about the lowest-priced stock we have ever picked.
Founded in 1986, and public for over a dozen years, Palatin develops peptide therapeutics for treating diseases, but mostly for female sexual dysfunction (FSD). Its primary product in clinical development is bremelanotide, which is a peptide melanocortin receptor agonist, for treating FSD. This has completed a Phase 2B clinical trial and the company has announced top line results. Palatin also has six other projects with two in preclinical studies and four in Phase 1 trials, including melanocortin receptor-based compounds for treating obesity, under development by AstraZeneca pursuant to Palatin’s research collaboration and license agreement; and PL-3993, a peptide natriuretic peptide receptor A (NPR-A) agonist for treating cardiovascular and pulmonary indications.
Early in November the company announced positive results for the Phase 2B bremelanotide FSD trial mentioned above. This trial involved 327 pre-menopausal women with FSD, among other disorders, and showed that women receiving the treating experienced significant improved measures of overall sexual functioning, compared with the placebo, according to the company.
This is another one of those small R&D companies with zilch income and massive losses, i.e. for the quarter ending 9/30/12, revenue was nil and losses totaled over $10.4 million.
If the company hadn’t received recent funding, we wouldn’t have picked it, but at the current stock price, we are looking for a dead-cat bounce. It sum, this is one to play for kicks and giggles.
Our 24-month target for the stock is $1.25 to $1.40.
For more information, contact PTN at 609-495-2200; email@example.com
BG MEDICINE, INC. (NASDAQ: BGMD) – $1.44. Twelve-month hi-low has been $12.80 – $1.15. Based in Waltham, MA, with about 35 employees, this diagnostics developer has 20.5 million shares outstanding, $19.4 million in total current assets, $20.14 million in total assets, little debt, and $9.81 million in total liabilities. Institutional ownership is around 85%. Two analysts rate the stock a “strong buy” and two other as a “buy”. www.bg-medicine.com
There are times when a company suffers unexpected losses and gets kicked in the teeth, and that appears to be what happened several months ago to BG Medicine, Inc. Despite investor disappointment at the time, the company still appears to have some good things going for it, such as product development and a decent looking balance sheet. Also, the stock seems to be dirt cheap and ready for a dead-cat bounce.
Founded in 2000, and public for nearly two years, BG Medicine develops novel cardiovascular diagnostics. Formerly known as Beyond Genomics, the company markets the BGM Galectin-3, a diagnostic test for measuring galectin-3 levels in blood plasma or serum for use in patients with heart failure through regional and national laboratory testing facilities and directly to hospitals and clinics in the U.S., as well as through distributors in certain European countries. It is also developing CardioSCORE, a cardiovascular diagnostic test designed to identify individuals at high risk for near term cardiovascular events, such as heart attack and stroke; and galectin-3 test for a second indication to identify individuals at risk for developing heart failure, such as heart attack victims, as well as patients suffering from hypertension or diabetes. The company also is developing LipidDx, which uses biomarker testing of patients with lipid disorders to enable them and their providers to more quickly achieve treatment targets with fewer office visits.
BG Medicine has strategic collaborations with Abbott Laboratories to develop and commercialize galectin-3 assay kits and related control kits and calibrators. It also has similar agreements with Alere, Inc., bioMerieux SA, and Siemens Healthcare Diagnostics. At the end of October, the company inked a pact with Kindstar Diagnostics which will provide galectin-3 testing services in China.
The company appears to be garnering revenues for its kits. During the quarter ending 9/30/12, revenue was $610,000 with $6.8 million in losses.
With all that the company appears to have going for it, the stock seems to cheap ignore.
Our 24-month target for the stock is $2.50 to $2.75.
For more information, contact BGMD’ Chuck Abdalian at 781-434-0210.
Look for our December 20, 2012 Newsletter to be posted on 12/17 or 12/18.