Loading...

Thursday, April 24, 2008

Siriusly, VFC Smells Merger

It’s been a long, long year (over a year, actually) for those waiting on a merger of the two satellite radio companies, Sirius (SIRI) and XM (XMSR).

Originally, both companies stated that the deal would be done by the end of calendar year 2007. The deal had to face approval from the Department of Justice first before final approval by the FCC.

The DOJ bought off on the deal and gave the green light in the first quarter of 2008, so now we’re still waiting on the FCC.

This is one of the most divisive merger’s in recent history. Lobbyists for both sides of the deal have been working overtime, and it’s hard to believe that’s the case, as we’re not talking a revolution in radio here, it’s freakin satellite radio, that’s it.

We’re not re-inventing the wheel, curing cancer or discovering an alternative fuel. We’re bringing two services into one so that the customers such as myself don’t have to buy both services just to listen to baseball games and football games on two different services.

Buying both would cost me more than what I’ll be charged when the two companies merge.

But for some reason, there is huge resistance to this merger. Shows you how much influence the National Association of Broadcasters have. They feel threatened by SatRad to the point where they will go to all means (filling politician pockets being one of them, I’m sure) to keep this deal from happening.

Congressmen and Senators from both sides of the isle have piped in on this merger.

The NAACP is among many public groups that have also chimed in.

It’s borderline ridiculous.

VFC believes we’re near the end of the wait, however.

The price action of both XMSR and SIRI the past two days tells me something’s up.

The sharp increase on Tuesday followed by a late-day increase Wednesday is telling me the cat may be out of the bag and that approval is inevitable. The big boys always find out first.

I could be wrong, these stocks have jumped up and down on rumor and news before, and this may be the case now, but I think this time it means big news is coming for the positive.

Positive, unless you’re short the stock, of course.

It looks like something got released on Tuesday and Wednesday was spent trying to keep it down, but it ended up.

I expected a retreat on Wednesday, which it didn’t do, so VFC is smelling merger.

And it’s about time.

One way or another, the FCC needs to do something.

It is, however, no surprise that it’s taking the government this long to come to a simple decision.

Wednesday, April 23, 2008

VFC’s Follow On Biologics Pick, Insmed Incorporated (INSM)

VFC believes that there will be big money up for grabs by smaller biotech companies in the not-so-far-off future by means of Follow-On-Biologics.

The definition of follow-on biologics, as presented on the Insmed website, HYPERLINK "http://www.insmed.com/products_pipeline/biologics.asp" http://www.insmed.com/products_pipeline/biologics.asp, is as follows:
Follow-on biologics are versions of approved biologics that are developed after the original product has been created with the intention of marketing them after the patent on the innovator product has expired, thus bringing competition to monopolistic markets.
In other words, when the patents on current drugs expire, other companies can step in with their own, possibly cheaper, products to create competition in the drug market.

Over the past year, Congress has debated legislation to initiate an approval and regulatory process for follow-ons.

Insmed is one of the leading companies pushing Congress to initiate regulation of follow-ons, often with the CEO going to Capitol Hill to state the case for new, favorable follow-on legislation. Currently, no path exists for a company to bring follow-ons to market.

A little over a year ago, Insmed lost a patent-violation court case where it was argued that Insmed’s drug Iplex violated Tercica’s patent for it’s similar drug, Increlex. Both drugs were administered as insulin-like growth factor for short-statured patients, but Insmed’s drug, Iplex, is the superior drug. Iplex only needs to be injected once a day while Tercica’s drug, Increlex, is a twice a day shot.

In addition to the follow-on-biologics pipeline Insmed is creating, Insmed is also currently conducting various-phased trials for Iplex treatments for other indications, such as ALS, HIV and MMD. Eventually, Iplex itself has the potential for blockbuster status, although some of that money will be dished out to Tercica thanks to the patent infringement case.

Insmed is also working on products for the treatments of various types of cancer.

I emphasize again that finding small biotechs that are not one-trick ponies, meaning they have more than one drug in the pipeline, is the smarter way to go than investing into companies that have only one chance at FDA approval. If one of the pipeline products goes south, there’s always a second option to fall back on.

In the case of Insmed, the potential exists for success in both it’s own pipeline and the follow-on-biologics pipeline. Once Congress approves a path for FDA approval of follow-ons Insmed should lead the way to prosperity.

Insmed did us good once in the way of stock price with a brief run-up of around $1.50 last year leading up to the court decision. Although buying in at around $1.00 initially, I fully expected Insmed to win the patent-infringement case, so I did not sell as much as I should have at $1.50.

Over the past year I’ve been accumulating INSM with a plan to accumulate for at least another six months to a year before I’ll HOLD for a few years while things develop.

With Insmed’s current pipeline and the potential to reap follow-on rewards, I think we have a winner here in INSM.

Thursday, April 17, 2008

Ya Gotta Love Hugo

As Hugo Chavez continues his reign of ‘21st Century Socialism’, he continues to pocket every dime he can from the oil boom. Can’t blame the guy for wanting to take all he can, but when is enough going to be enough?

When he nationalized Venezuela’s oil industry, Exxon had something to say about that, as previously mentioned @ VFC’s News House, and now Hugo wants to charge a 50% windfall tax on foreign oil companies that operate within Venezuelan borders. The 50% tax takes effect when oil trades above 70 dollars a barrel, but can reach 60% when oil trades above 100 dollars a barrel.

Venezuelan officials estimate that this new tax will rake in nearly nine billion dollars annually, which Chavez says he will use to fund his social programs.

VFC believes the only social programs that Hugo Chavez wants to fund are his own, to the night clubs and nudie bars.

Chavez would have us believe that his modern-day social revolution is changing the course of Venezuelan history and making life better for thousands of poor people.

Francisco Rodriguez did a great job at analyzing the numbers for his piece in the March/April issue of Foreign Affairs where he laid out the facts, analysis and research to address Chavez’s claims.
Rodriguez came to the same conclusion that VFC (and probably millions more) had suspected all along: that Hugo’s claims are all smoke and mirrors. Nothing he says is of substance and he’s profiting all he can off this oil boom before time runs out and the price of oil starts retreating.

Another factor is that the Venezuelan claims to how much money this new tax will rake in may be exaggerated. Big business likes to make profit; not only money but PROFIT. Big business like Exxon, BP and Chevron may decide to pump money and operations elsewhere where they know they’ll be able to keep a larger chunk of their profits.

Exxon already attempted to bring an economic smakdown to Chavez when Chavez nationalized the oil industry, and it’s only a matter of time before other economic giants start standing up to this guy, too.

Unfortunately, with all else going on in the world, most of what this guy does slips through the cracks.

Why VFC Sold out of his BVTI.OB Position

As I mentioned a few days ago, we were waiting on results of Biovest’s Phase III trials for their immunotherapy cancer vaccine BiovaxID. When I bought in at .45 cents, I thought it was well worth the gamble because positive results on the trial would make for a nice pop in share price and I could laugh my way to the Caribbean, just like we did right after Dendreon (DNDN) hit last year.

Two problems now arise with this scenario. First, we didn’t get Phase III results as we were waiting on. We got news that an independent Data Monitoring Committee recommended that the results of the trial be unblinded and put forth before the FDA. I don’t like that news. This is not the news we were expecting to hear, so this may just be a warning for some to get out while they can, before the disappointing results are released later, now expected in August.

Also, Biovest is a subsidiary of Accentia Pharmaceuticals (ABPI), and they not too long ago released disappointing results of trials for their Sinuphase drug. Not long before those results came out we got a nice PR stating that Sinuphase was featured as a ‘Future Blockbuster’ in Med Ad News. The stock price reacted accordingly before heavily retreating after the failed Phase III trial.

Accentia owns roughly 70% of Biovest, so they may be profiting today by a ‘false’ rise in share price. They need money bad after the Sinuphase results and this may be a chance to make some.

Granted, this pop in price will not be enough to sustain operations for too long, but it’s something. And it’s something more than what they would have after releasing disappointing results for the Biovax trial.

Another factor to consider, is that although Dendreon made a lot of us a lot of money last year, those that did not sell on the positive ‘advisory committee review’ learned the hard way that advisory committee reviews don’t mean squat to the FDA.

So although todays news could be construed as positive, the realist in me is not convinced, so I’m out.

I may buy back in when the stock price hits .45 cents again, but at this time I’ll take my 60% gain and call it day. If I was in front of my computer this morning, I would have gladly sold out at near a dollar, but I’ll settle for my .70 cent sell.

When I’ve gotten burned in the past it was because I was too greedy, so I will not make that mistake again and wait for the news (that we thought we’d get today) that now may never come.

Bottom line, a 60% gain is a 60% gain, but if you don’t sell and bad news comes, it’s a 0% gain and a possible loss.

And this PR did not pass VFC’s gut check.

Happy trading!

Tuesday, April 15, 2008

Celsius Insiders Load Up With More Shares

Celsius Insiders have loaded up on the commpany's stock once again.

Four Insiders excercised options to purchase large chunks of CSUH.OB stock at .11 cents.

The .11 cent mark has been my limit price for some time, and I'm confident that these insiders see big things coming down the road, so they're all getting in at the ground floor. That ground floor looks like 10-11 cents.

VFC is happy to be getting in on the ground floor, too.

VP Janice Haley excercised an option to purchase 250,000 shares while the following also excercised options to purchase the following amounts: COO Richard McGee 300,000 shares, Director James Cast 200,000 shares and CFO Jan Norelid 900,000 shares.

I'm always a fan of insider buys, and I like the fact that these guys (and girls) are buying at .11 cents.

There's been some controversy over the J&G deal in the Middle East since J&G got a huge chunk of shares when the deal went through, but I think that they're making an investment into their own marketing ability by owning a large part of the Celsius business. They don't foresee those 800,000 cans sitting around in Lebanon collecting dust. I'm also of the opinion that they would not have made such a large order or large investment if they were not already confident they could make the investment back, and thensome.

With the addition of the J&G deal, and with re-orders and new distribution here in the States, we should see a turning point in this quarter's earnings call.

And we still haven't heard from Jorge Hane, the weight loss guru who recently agreed to promote Celsius as part of his weight loss plan. A nice sized order from Jorge could also do wonders to the company's bottom line.

Again, this company is not building growth by means of expensive ad campaigns (they can't afford it), but they are growing one distributor at a time, and the size of the deals is increasing as time goes on.

The international deals are especially encouraging, and we're starting to see quite a few of them.

Eleven cents has been my entry mark for quite a while, and I'm glad to see the insiders loading up right there.

I'll be continuing to add if they continue to keep the price so low, but eventually we're going to rise above this 11 cent nonsense.

And VFC will be smiling, but not as much as these insiders.

Monday, April 14, 2008

Biovest (BVTI.OB) Should Release Phase III results for BiovaxID Any Time

While Russia just granted approval for Oncophage, making it the world's first approved cancer 'vaccine', another small biotech, Biovest (BVTI.OB), will at any time release critical results of a Phase III trial for it's own cancer immunotherapy, BiovaxID.

BiovaxID is Biovest's vaccine to treat Non-Hodgkin's Lymphoma.

I got myself a few shares of this one for .45 cents, waiting on the results of this trial. If the results are positive, we could see a nice jump in share price, although as Dendreon (DNDN), Genitope (GTOP) and Antigenetics (AGEN) showed us, chances of getting a cancer vaccine approved in the States is pretty slim.

As I've discussed over at VFC's News House, I think we're on the verge of some huge breakthroughs in cancer treatment, and I think these cancer vaccines will turn out to be a big factor in those breakthroughs.

These cancer vaccines are not vaccines as we know them; they don't prevent cancer, but they train the body's immune system to fight the cancerous cells. The problem has been that so far, none of the many Phase III trials has actually yet to reach it's primary endpoint, leading to none being approved in the US, and only one worldwide.

The positive thing is that some of these vaccines have been prolonging life in the cancer patients, as does Provenge, DNDN's prostate cancer vaccine that recieved a positive recommendation from an FDA advisory committee before ultimately getting told by the FDA that they need more proof it works before granting approval.

One of these vaccines will eventually hit, in my opinion, so it's worth the small investment to get in on BVTI.OB in case the results are positive.

I've talked about risk-reward before, and the risk-reward here for .45 cents was well worth it to me. It's still worth it, in my opinion, with the stock trading at .60 cents.

I've also discussed the positives of getting into biotechs that have a fall-back option, a second drug that has potential so that you can recover some, if not all, of your losses if the first one fails. EPCT is a great risk-reward right now trading in the .40s. Genitope (GTOP) is a great example of a one-trick pony that doesn't recover when it drops because there was no fall-back drug to rely on. Biovest's second treatment is Revimmune, a treatment for transplant rejection, recently highlighted in a Baltimore Sun article.

News of Biovax should hit any day now. Hopefully the news is good for the investors, but even more importantly, good for the cancer patients that will benefit from the treatment.

If the results are positive, we may be able to finally get the FDA to approve a cancer vaccine.

Or maybe Russia will be the ones to approve.

Capstone Turbine (CPST), The Orders Keep Rolling In

The orders keep rolling in for Capstone Turbine, and VFC likes the price action since I first mentioned stock back in January.

CPST is currently trading right around $2.80 and the company is still looking strong.

Since the beginning of April, the company issued a handful of press releases regarding new orders, totalling nearly $10 millions dollars, including $5 million from DesignLine, just over $2 million from Samsung and $2.6 million from Verdesis Suisse SA.

Business is growing for these guys, and so is the stock price, so VFC is going to be adding shares on the dips.

I found this one looking for something 'green' for my portfolio, and it's produced a nice bit of green for the bottom line.

I'm still liking CPST.

YourOfficialCreditReport

Wednesday, April 9, 2008

Celsius Rising (CSUH.OB)

As Celsius Holding's stock, (CSUH.OB) still sits at .11 cents, the company announced an 800,000 can order from Joseph and Gionis, LLC (J&G) to distribute the Celsius beverage in the Middle East. According to the press release, this 800,000 order will be shipped to a sub-distributor in Lebenon.

800,000 cans is a huge order, and as reported in previous conference calls, Celsius receives a higher profit margin selling cans than it does selling bottles, so this is a nice deal with nice profit margins for the company.

As part of the agreement, J&G agreed to a minimum purchase order of at least $7.5 million dollars over the next five years. Good news, as J&G believes the company and the product will still be around in five years, making me feel better about CSUH.OB as an investment.

As Celsius grows, and signs more international deals, the stock price is still sitting right around .11 cents, aside from a brief run-up in January to nearly .30 cents.

With this deal, J&G also invested $500,000 dollars into Celsius Holdings and received 10 million shares of the company's common stock in return.

Included in the deal, J&G also has the option to purchase up to seven million more shares of common stock at .13 cents.

The deal with J&G may look pretty lopsided at first glance, but in order for Celsius to survive, they need backers and J&G came to the table in a pretty big way.

More dilution means more shares which is bad for the current shareholder. However, on the plus side, J&G now has a vested interest in the company. Celsius needed cash, and they needed it bad. The current pace of growth was not enough to sustain current and future operations, but getting another big time investor on-board after a few insiders already put their own money into the company means good things, in VFC's opinion. This is a ground-floor operation, and the big guys are all getting in at the ground floor. So is VFC.

The stock price wasn't effected by this announcement; after an initial jump to .13 cents, the stock retreated back down to roughly .10 cents again. More than just coincidence, I believe. They're keeping us down for the near-term so the big boys can get in cheap before a nice run-up, in my opinion.

Additionally, we still haven't heard anything about orders from the Jorge Hane deal, and the domestic growth should improve in the coming quarters with the re-orders coming in and new distribution signed.

I'm still very confident in the steps that leadership is taking to grow the company, and I'm expecting more domestic and international growth in the near future.

We're still sitting on a great buying spot for CSUH.OB and my confidence that this company will still be around in five years just increased with this financing/distribution deal.

The big boys like keeping this stock low so they can all get on board, but it's only a matter of time before we see a nice jump in price and us little guys can reap some rewards, and maybe some European vacations.

VFC says stay tuned to CSUH.OB.

Tuesday, April 8, 2008

Russia Lays Down the Gauntlet for Cancer Vaccines, AGEN (Antigenics)

Unfortunately VFC wasn’t in this one as much as I could have been, but a little-known biotech company called Antigenics (AGEN on the Nasdaq) received approval in Russia to market Oncophage, the company’s treatment for Kidney Cancer. Oncophage is the first cancer ‘vaccine’ to win regulatory approval anywhere and may opent the door for more to follow, such as Dendreon’s (DNDN) Provenge.

The Russian approval should start bringing in the cash that the company needs to continue the trials that the FDA asked for and allow Antigenetics to possibly gain approval from the US.

In the meantime I’ve sold my options for a nice profit, but by no means was it a payday, just spare change.

The positive thing here is the fact that this was a first, and hopefully more of these ‘vaccines’ begin to win regulatory approval around the world, to help those that need these treatments and increase our abilities to fight against.

Now I sit back and wait on news from Biovest (BVTI.OB) regarding their Phase III studies for BiovaxID and of course interim news on Dendreon’s (DNDN) Provenge Phase III trials which could result in approval this year.

Love them biotechs.

Follow by Email