***We no longer follow the companies mentioned in these backdated newsletter issues. These samples of past newsletters are generated to give you an idea of what you can expect when you subscribe. Please do not use any of the information contained in the samples below as current advice. If you would like to purchase a newsletter subscription, please click here. ***
Hello Readers,
Since the last Newsletter, we have closed two more positions; one for a gain and the other for a loss.
ADVENTRX PHARMACEUTICALS (2/20/11). Closed position 6/29/11 at $3.24 for a 55% GAIN.
ENERGY FOCUS (6/5/08). Closed position 6/29/11 at 50 cents for a 79% LOSS.
AdventRx Pharmaceuticals got a nice boost when two brokerage houses came out with targets on the stock of $7.50 and $14 respectively. Overly optimistic? We don’t know, but we are happy to take the gain at current prices. After a long siege, we finally closed Energy Focus for a loss.
OUCH! The last two months have been painful and, in the last few Newsletters, we have given our view as to why, which is also the conventional wisdom. Simply stated, again, the markets are in a state of flux as QE2 ends, but, as we have been saying, this is probably nothing to worry about. If the Fed sees the economy about to weaken even more than it has, it will just dream up more new devices to keep things rolling. Once investors begin to accept that notion, the markets could go even higher. The rest of the summer could see a nice upturn, barring any major catastrophe.
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.
Neostem (NBS)(5/20/11). The Pontifical Council for Culture and NBS announce steps forward in their partnership to advance adult stem cell research.
MediciNova (MNOV)(5/20/11). Forms joint venture with Chinese company to develop and commercialize MN-221 in China. Global Hunter Securities gives the stock a “Buy” rating.
Pluristem Therapeutics (PSTI)(3/2011). Enters into an exclusive license agreement with United Therapeutics to develop and commercialize PLX cells for treating pulmonary hypertension. Dawson James brokerage gives the stock a “Buy” rating.
Oculus Innovative Sciences (OCLS)(3/5/11). AmDerma Pharmaceuticals exercises option to license rights to Oculus Microcyn-based acne drug candidate.
Network Engines (NEI)(2/5/11). Becomes Oracle PartnerNetwork Gold Level partner.
Real Goods Solar (RSOL)(1/20/11). To merge with Alteris Renewables sometime during the current quarter; this could work out for RSOL.
Great Basin Gold (GBG)(1/5/11). Sets earnings call for August 16.
Sprint Nextel (S)(1/5/11). The usual four or five dozen stories and/or releases; most notable, perhaps, the company is offering 4G WAN to enterprises and Spring signs a deal with LightSquared.
RELM Wireless (RWC)(11/5/10). Provides ARINC interoperability test and demonstration center with KNG series trunked radios.
Inovio Pharmaceuticals (INO)(10/20/10). Claims DNA vaccine for Foot-And-Mouth disease generates protective neutralizing antibodies in second large-animal study. Prostate cancer DNA vaccine demonstrates strong T Cell responses in monkeys; on track for Phase 1 clinical trial.
Blue Phoenix (BPHX)(10/20/10). Wins $700,000 COBOL to Java modernization contract from a leading U.S. financial organization.
Rexahn Pharmaceuticals (RNN)(7/20/10). Completes patient enrollment in Serdaxin Phase 2b clinical trial for major depressive disorder. Brokerage Bream Murray gives the stock a “Buy” rating. Files $100 million shelf registration.
Adolor Corp (ADLR)(5/5/10). Several investment advisors upgrade or initiate coverage and breathe new life into the stock.
NovaBay Pharmaceuticals (NBY)(4/20/10). Files $5.2 million secondary offering.
China Direct Industries (CDII)(4/5/10). To start iron ore shipments to China from its Bolivian operations in the 4th quarter of FY2011.
Cytokinetics (CYTK)(2/5/10). Opens next Phase II clinical trial of CK-2017357 in patients with ALS.
Bridgeline Digital (BLIN)(6/5/08). Releases iAPPS v4.6. Sees continued growth and demand for license sales of iAPPS cloud-based option.
GlobalScape (GSB)(5/20/08). Unveils new data backup and recovery software.
LRAD Corp (LRAD)(10/5/07). Receives new LRAD order for waterfowl control. Announces opening LRAD order from Israel’s Ministry of Defense.
Our picks for this Newsletter are two more biotechs, both NASDAQ-listed.
SOMAXON PHARMACEUTICALS, INC. (NASDAQ: SOMX) – $2.14. Twelve-month hi low has been $5.48 – $2.10. Based in San Diego, CA, with about 40 employees, this drug maker has 45 million shares outstanding, $47.59 million in total current assets, $49.59 million in total assets, little debt, and $11.17 million in total liabilities. Institutional ownership is around 40%. Four analysts rate the stock a “strong buy”. www.somaxon.com
Usually, we will pass on “Johnny one-notes”, or drug companies with only one drug in or out of the pipeline, but Somaxon Pharmaceuticals, Inc. seems to be a little different. Their main drug has FDA approval, their lead partner happens to be one of the biggest names in corporate America, and their balance sheet appears to be very healthy. Also, we cannot help but think that the company has other plans up its sleeves.
Founded in 2003, and public for over five years, Somaxon focuses on the in-licensing, development, and commercialization of proprietary branded products and late-stage product candidates for treating diseases and disorders in the central nervous system therapeutic area. Its principal product Silenor was approved by the FDA early in 2010 for treating insomnia characterized by difficulty with sleep maintenance. Silenor is an oral tablet formulation of doxepin at strengths of three milligram and six milligram. Doxepin has been marketed from 75m and 300m per day and is indicated for treating depression and anxiety. Silenor is the first and only nonscheduled prescription medication approved for treating sleep maintenance insomnia.
Currently, the company’s lead co-partner in marketing Silenor is Proctor & Gamble, however, in early June, Somaxon added Paladin Labs to the list. The two companies entered into an exclusive agreement under which Paladin will commercialize the drug in Canada, South America, and Africa; P&G will, of course, be a lead U.S. distributor. Once Silenor is commercialized in the licensed territories, Somaxon will be eligible to receive sales-based milestone payments of up to $128 million, as well as a percentage of net sales.
Like many small drug makers/biotechs, Somaxon has little revenue and a lot of debt. For example, during FY 2010, ending 12/31/10, revenue was just over $1 million with losses of nearly $39 million.
Besides the P&G partnership, the deal with Paladin, and the balance sheet, we also like the fact that there are four “strong buys” on the stock.
Our 24-month target for the stock is $3.75 to $4.25.
For more information, contact SOMX’s Tran Nguyen at 858-876-6500; investors@somaxon.com
RXi PHARMACEUTICALS CORPORATION (NASDAQ: RXII) – $1.00. Twelve-month hi-low has been $4.08 – 73 cents. Based in Worcester, MA, with about 30 employees, this biotech has 41.9 million shares outstanding, $11.39 million in total current assets, $11.88 million in total assets, little debt, and $8.65 million in total liabilities. Institutional ownership is around 9%. Three analysts rate the stock a “strong buy”. rxipharma.com
Here is another of those small biotechs possessing complicated technologies that only a Mensa member can grasp, but has the potential for being a nifty stock play. RXi Pharmaceuticals Corporation has not only drawn the attention of some Wall Street analysts, but has recently received grants from UMass Medical School and from the NIH; which leaves us to believe that there must be something to their technology.
Found in 2003, and public for just over three years, RXi Pharmaceuticals pursues therapeutics based on ribonucleic acid (RNA) interference (RNAi). Without getting overly technical, the company’s lead product candidate includes NeuVAX that is slated to commence Phase III clinical trials in low-to-intermediate HER2+ breast cancer patients, not eligible for Herceptin. Its RNAi product candidate under development, RXI-109, targets connective tissue growth factor and is in development for anti-fibrotic diseases, including anti-scarring. RXI-109 is scheduled to start human clinical trials for anti-scarring in planned surgeries in early 2012.
In early June, RXi announced positive NeuVax (E75) Phase 2 efficacy results after 36 months of follow-up. NeuVax demonstrated statistical significance in three-year disease free survival in adjuvant breast cancer with 0% recurrence in the treated group versus 22.2% in the untreated group. A Phase 3 study is expected to begin during the first half of 2012 under FDA approved Special Protocol Assessment.
Once again, RXi is another small biotech with little revenue and some major losses. For the quarter ending 3/31/11, revenue was zilch and losses were $3.8 million.
There seems to be a lot of promise with RXi and at the current stock price, it seems to be worth a shot.
Our 24-month target for the stock is $1.80 to $2.00.
For more information contact RXII’s Tamara McGrillen at 508-929-3615; ir@rxipharma.com
Look for the July 20, 2011 Newsletter to be posted on 7/18 or 7/19.
Happy 4th!
George