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Sunday, December 20, 2009

Celsius Holdings - My Last Post of the Year

This may be my last post of the year as I'll be spending the next couple of weeks with friends and family. I wish all readers of VFC's Stock House the very best for the Christmas season and on into the New Year.

Please take time to remember those that may not be as fortunate as you and I - because the opportunities that we have to prosper are not available to most in this world.

For my last update of 2009, I wanted to update my last post regarding Celsius Holdings and the new employment contracts for CEO Steve Haley, Vice President Janice Haley and CFO Jan Norelid.

Mr. Haley responded to an email note that I sent him and the short version of his comments regarding the contracts are this:

No big deal. The contracts were due to expire and the new contracts reflect how much better a position Celsius Holdings is in now compared to when the expiring contracts were written.

I expect big things from Celsius Holdings in 2010 - should be a great year for all involved.

Again, thanks to everyone who stays involved with this blog, and let's all count on a prosperous 2010.

It's been good. Now it's time to pick up a Corona and go look for some sun and sand; and most importantly, spend some time with the fam.

See ya next year.

Friday, December 18, 2009

Briefs: BDSI, CSUH

BDSI: BioDelivery Sciences earlier this week released positive results from a Phase II study measuring the safety and efficacy of BEMA Buprenorphine for the treatment of pain after dental surgery. BEMA Buprenorphine utilizes the company's BEMA drug delivery technology to deliver Buprenorphine through the inner lining of the cheek.

Earlier this year the FDA approved Onsolis, a treatment for breakthrough pain in cancer patients, and BioDelivery partnered with the US subsidiary of Meda Pharmaceuticals to bring the product to market.

The BDSI stock is still trading for a price (around four bucks) that I consider to be a steal, and I believe that in the mid to long term, BDSI is going to return some nice gains to patient shareholders.

With Onsolis already rolling and BEMA Buprenorphine moving along, BDSI can hardly still be considered a speculative stock.

Great long term play, in my opinion; but do your own DD.

Disclosure: VFC is long BDSI.

Holiday Gift 300x250

CSUH.ob: Celsius Holdings announced on Friday that five flavors of the calorie-burning beverage will soon be available at Marsh Supermarkets in Indiana and Ohio.

As product distribution continues to grow, the real attention that attracted investors on Thursday evening was the official filing of 'Revised and Restated Employment Agreements' for CEO Steve Haley, Vice President Janet Haley and CFO Jan Norelid.

The documents were modified to terminate the auto-renewal clause in the agreements and to also reduce the amount of authorized severance pay from two years to one year in the case of 'termination without cause'.

With the filing of these documents preceding an expected announcement of a 20:1 reverse split - and a possible move to the AMEX looming - it's safe to assume that something is going on behind the scenes at Celsius Holdings that we haven't been keyed in on yet.

That being said, I'm still looking for a boom in sales growth in 2010 - which could turn out to be stellar year for the company and its products.

Stay tuned to this one - things are getting interesting.

Disclosure: VFC is long CSUH.

Readers Respond: MSHL, ANX, ARDM

MSHL: A comment regarding Marshall Edwards, Inc.:

Hi VFC,
Any thoughts on MSHL?

Thanks.


VFC's Take: Marshall Edwards, of which Novogen owns over 71% of the common stock (according to the most recent quarterly report) could be a decent long term speculative play - whith some added short term potential based on the review of data from the OVATURE trial. The company announced in April 2009 that, apparently for financial reasons, they would cease future patient enrollment into the trial and instead focus on measuring the safety and efficacy of phenoxodiol in ovarian cancer. If positive, Marshall Edwards intends to look for additional outlicensing/partnership agreements.

It is the possibility of a near term announcement regarding the data review and/or partnership possibilities that bring short term potential to the stock, but the long term potential lies in the advancement of the cancer fighting technology pipeline that is still a ways away from market. Because of the company's near dire (in my position) financial situation, any short term spike will be used to raise the funds needed to advance the rest of the pipeline; therefore, no investor should expect a spike to hold the highs.

The upside: Seeing as how MSHL is trading under the radar at the moment, if the OVATURE review is positive then a spike to over a buck should be expected and sustainable, in my opinion, considering the future potential of phenoxodiol.

If the OVATURE review is not positive, however, the situation could get very difficult for this company. There's something about MSHL that I feel is more risky than most speculative plays, so I'm not a buyer here, but my opinion means little in the grand scheme of things; do your own DD and understand the risk/reward.

Disclosure: No positions.

SalesTaffy

ANX, ARDM: A comment regarding Adventrx Pharmaceuticals, Inc. and Aradigm Corp.:

Hello VFC,
could you share your thoughts about Aradigm(ARDM) and ANX? Both look as significantly undervaluated biotech companies with several catalysts comming near term. In the case of ARDM there is a significant milestone comming in January and ANX is preparing their first NDA with a speed "reformulation" track. ANX rallies right now, so would you wait till there is some pullback?


VFC's Take: I've commented on both of these stocks in the past and I continue to believe that both are decent long term speculative plays - with short potential to sell into any spikes in order to end up on house money for the long term.

Adventrx especially has started to receive some hype of late, and a pullback is possible after the hype dies down, but since there is the possibility that news could be released in short time that would push the stock higher, I see nothing wrong with starting to buy a position in the stock now, but holding some cash on the sidelines to add shares if it drops; this way, you don't miss out on the run but can still take advantage and average down on a decline.

Aradigm has become more attractive as an accumulation play with the recent drop that has the stock trading at thirteen cents, and any decent update news could make for a quick double in price.

Read the following posts for my recent updates on these two stocks:

Readers' Stock Picks: ANX
Readers' Picks: ANX
Readers Respond: ANX

Readers' Stock Picks ARDM
Readers Respond: ARDM

Diclosure: No positions, although I may start accumulating both very soon.

Free Fast

Wednesday, December 16, 2009

Briefs: SIGA

SIGA: Shares of Siga Technologies, Inc. have rebounded slightly after last week's drop to below five dollars.

Shares traded as high as $6.41 on Wednesday after investors became aware that the Director of the company had added a few shares to his position in an insider buying transaction.

After listening to the conference call on Monday, it's my opinion that nothing has fundamentally changed with the short, mid or long term future of the company and - amendment or no amendment - the BARDA contract could still be announced at any time.

Those long termers that were willing to buy into last Friday's dip have already seen a nice return on their investment; although I'm not yet ready to believe that the volatility is over until we see some news.

Disclosure: VFC is long SIGA call options.

Storm 300 x 250

Briefs: CSUH, CVM, CBAI, NEPH

CSUH.ob: Celsius Holdings announced on Wednesday via an early morning press release that the company has "spearheaded" a national advertising campaign with an ABC SuperSign advertisement in Times Square featuring Mario Lopez enjoying a Celsius.

The ad has been on display since just before Thanksgiving and will be up through the New Year, according to the Celsius HotSpot blog , located on the company website.

As I mentioned when this news was first released on the company's website, there is no bigger show during the Holiday Season than Times Square; and putting a SuperSign banner in the heart of NYC - where millions from around the globe will be exposed to it - is a bold move into the mainstream by the company, in my opinion.

Only time will tell if the national advertising campaign is translating into revenue growth, and the next two quarters will be crucial in judging just how well the product is catching on.

Also of note, investors are still awaiting news on major distribution announcements (Wal Mark, CostCo, etc.) and a possible update on the pending reverse split and possible move to a major exchange, although I'm not holding my breath on big news from any company right now until after the New Year.

Volume remained relatively stagnant with the news.

Disclosure: VFC is long CSUH.



CVM: Speaking of the potential of expecting news releases before the New Year, I'm also not holding my breath on validation news from Cel Sci in the coming weeks. This is purely my own speculation, but I think that it would have a larger big-picture impact if significant news like that were released to kick off 2010, in conjunction with an estimated start date for the Multikine trial.

Validation news will be significant, however, because not only will it mean that the Multikine trial is that much closer to beginning, but the company will also be able to start announcing contracts for the cold-fill service that the new facility will have to offer.

While I wouldn't be surprised to not see validation news during the Holiday Season, an update on the LEAPS-H1N1 Johns Hopkins trial could be forthcoming at any time - in my opinion.

Disclosure: VFC is long CVM.

optionsXpress

CBAI.ob: Cord Blood America announced on Wednesday that the company's total debt reduction for 2009 was $10 million.

While the news is encouraging for the balance sheet, it's hard to ignore that the company whose stock trades for under a penny has over two and a half billion shares outstanding and nearly seven billion authorized.

Regardless, the recent run in the stock price could continue until the time of the Las Vegas facility grand opening, at which time the company could start announcing some stem cell preservation contracts.

I think that there could be a market here with the current shift in politics towards support for stem cell research, but keep a quick trigger finger with this one, in my opinion, unless you're taking a very speculative, long term approach.

If for some reason the January 22nd grand opening date is delayed, I'd be highly suspect of the company, but for the time being, the stock is worth watching for the potential of a 'hype spike'.

I wouldn't put more than 'night on the town' money on this, however, at least not for the time being.

Disclosure: VFC is long CBAI.

PrintingForLess.com

NEPH.ob Those who may have been waiting for a decent entry point into NEPH may have gotten their opportunity this week when shares of Nephros, Inc. dropped to as low as the mid sixty cent range after the company announced a stock sale.

Nephros is a nice long term speculative play, in my opinion, based on the company's water filtration technology - which includes a contract with the U.S. ONR to develop a portable filter for military use. Field testing of the product is on schedule for 2010, according to the most recent quarterly report.

Nephros is also currently awaiting word from the FDA regarding 510(k) applications for their End-Stage Renal Disease (ESRD) filters.

I like NEPH for below a buck, but each investor should do their own DD and invest accordingly.

Disclosure: VFC is long NEPH.

IdentityTruth Inc.

Monday, December 14, 2009

Briefs: GNBT, BIEL

GNBT: On the heels of some recent press exposure regarding Generex's Oral-Lyn, an insulin spray for diabetics, the company on Monday announced that interim results from an ongoing Phase II study of its immunotherapeutic breast cancer vaccine were positive and presented at the 32nd Annual San Antonio Breast Cancer Symposium.

The product is being developed by Generex's wholly-owned subsidiary, Antigen Express, Inc., and the trial is being conducted at by COL George Peoples, MD, at the Brooke Army Medical Center, according to Monday's press release.

The news bumped shares of GNBT to over sixty cents.

While the breast cancer immunotherapeutic vaccine offers some nice future potential, it's still a long way off from market and the interim results that investors are keying on are the Oral-Lyn interim results that should be announced early in 2010.

I still call sixty cents an accumulation level for GNBT.

As always, do you own DD and invest accordingly.

Disclosure: VFC is long GNBT.

Get the best possible prices with XpressRouter.

BIEL.pk: BioElectronics was highlighted on Monday as one of my Pink Sheet Pleasures, but the company also issued a PR on Monday morning announcing that a financial audit is nearing completion and investors will soon have full transparency into the company's financials.

According to the PR, shortly after the audit is complete, BioElectronics will file the necessary paperwork to become a 'fully reporting' company.

This is an encouraging development for a company that is priming itself for a year of growth in 2010, while a move to the OTCBB is also likely at some point.

Shares of BIEL spiked to nearly seven cents on Monday after trading for below four cents at one point this week.

Almost as encouraging as the news is the fact that BioElectronics actually issued a press release announcing the update rather than sending Joe Noel to the Yahoo message boards to issue the update.

While BIEL continues to trade with volatility, it's still worth buying the dips, in my opinion.

Disclosure: VFC is long BIEL.

BIEL, CBAI, CDOI, LLBO - Pink Sheet Pleasures, or Not?

Here's VFC's Take on a number of pink sheet and OTCBB stocks that have come in comments, emails or discussions of late; I usually don't mess with the sub-penny stocks, but I've been known to buy a few 'just in case' shares with my Grey Goose money, and as MCLN and GCKO (among others) have recently shown, there's no reason to completely ignore the sub penny stocks, as long as you understand the risk involved.

I also don't recommend that an investor use anything other than 'night on the town' money to play the pennies and I also would emphasize to stay away if you're not in a position to move quickly (buy/sell on the drop a dime to bank some profit).

That being said, here's my take on a few that I've been asked about lately:

BIEL.pk: After dipping to below four cents last week, shares of BioElectronics have swiftly rebounded to above six cents - reaching an early Monday high of .068 before retracing.

Investors continue to await news of FDA reclassification and approvals in the United States, although the company's Direct Response television ad campaign should be off and running in some overseas markets.

BioElectronics is far from being free of significant market challenges - and the company's communication with shareholders continues to be questionable - but those are the reasons that investors are still able to buy into this company for what I consider to be an attractive price.

2010 could turn into a banner year for the company, but it's the FDA approvals that matter for the short term.

Disclosure: VFC is long BIEL.



CBAI.ob: Shares of Cord Blood America have been on the move to the upside over the past few weeks after the the umbilical cord blood stem cell preservation company recently announced that it's Las Vegas corporate office and laboratory will be open for business on January 22, 2010.

Stem cell research has gained traction in both the political and commercial arenas, and purchasing a few 'night on the town' shares of a company that could be getting a head start on the storage aspect of the market could pay off pretty good over the mid to long term, while there is also some short term potential for the stock to move higher as the January 22 grand opening date approaches.

The biggest question that potential investors have when playing with the penny plays is whether or not the company is for real or not; meaning does the company actually follow through on the promises of the press releases. I followed 'Cord Blood America' for a while before buying in and I'm pretty convinced that these guys are legit; but firm dates such as the January 22nd grand opening allow us the opportunity to see if the company can follow through on its promises.

If nothing else, the stock should be hyped and pumped between now and the third week of January - I've already seen CBAI popping up in message board discussion - and that could offer investors and traders the opportunity to flip a few shares and possibly end up on house money before long.

The stock is still trading for below a penny, but has moved up recently.

Definitely a risky play, but one with some potential, in my opinion.

Disclosure: VFC is long CBAI.



CDOI.pk: Cardio Infrared Technologies, INC., according to the company profile, develops and markets exercise equipment that utilizes infra red technology to provide weight-loss and anti-aging benefits that go beyond the normal reach of standard exercise equipment.

The stock has been absolutely hammered this year so far, but according to some recent press releases, things could be picking up for this company and I picked up a few 'just in case' shares last week for around .004 cents.

That being said, it's time to look for signs that the company is moving along. A press release from early October stated that the company would highlight its Cardio-Cor system at an Anti-Aging show that was to take place in Las Vegas last week, but no follow-up press release ever originated from the company regarding the event. The event did take place at the Madalay Bay resort and casino, so if the company was there - I'd expect an update soon.

Additionally, Phase II results were due to be released in early December and we've still heard nothing regarding those results.

On the bright side, however, is sales are starting to roll in - the most recent being a $400,000 order from New Orleans for Cario-Cor and Cardio-Cor II - and at the end of the day it'll be legitimate sales numbers that ultimately justify the movement of the stock.

For the time being, I think that the stock does have some potential based on the possibility that Phase II results will be released (although I'm not holding my breath); but I also think that the stock is volatile enough to be worth a quick trade at the opportune time.

Again, this one is high risk, but if the company can release a PR in the coming weeks to validate previously released statements, shareholders may be able to jump on a quick double. According to the pink sheets, the current estimated market cap of the company is $3.5 million, so I couldn't see the stock holding a price of much more than a double for too long; but that's just my opinion.

Additionally, there are 1.5 billion shares authorized, and while that is a reduction in the amount of authorized shares than just a few months ago, it's likely that any significant bump in price would be accompanied by dilution.

That being said, I still see some potential with CDOI - especially if Phase II results are released and the company did in fact show up for Anti-Aging show in Vegas and isn't just pulling our legs.

I wouldn't play this one for the long term prospects, rather I'd jump on the short term trading opportunity, but do your own DD.

Disclosure: VFC is long CDOI.

Holiday Gifts from Chocolate.com

LLBO.pk: Lifeline Biotechnologies, Inc. is another pink play that has garnered some attention over the months.

Lifeline's claim to fame is the early warning breast cancer detection system called "The First Warning System". The system, according to statements from the company and backed up by studies, is more effective and safer than a mammography in early breast cancer detection.

Currently, the company is awaiting news from the FDA regarding classification issues.

LLBO has some nice potential, in my opinion, if they can bring First Warning to market, especially as public sentiment may be moving away from mamograms - if given a safer alternative - but the stock is not the sure thing that many out there believe it is, in my opinion.

With over two billion shares currently outstanding, it would take significant news to move the stock in a significant way, in my opinion, but if it looks like First Warning is going to meet muster at the FDA, then a higher price could be justified.

Regarding the amount of outstanding shares, the CEO of Lifeline recently stated in a press release that there are no intentions to conduct a reverse split; which, in my opinion, means that he is concentrating on developing and advancing the product and is not yet so concerned about building a stock.

That works for me, for the time being, but if 'First Warning' looks to make it to market, I'd have to expect a reverse split at some point.

Tread cautiously, but the risk/reward with LLBO is decent enough to throw some 'night on the town' money at the stock.

VFC's Take on LLBO
LLBO Update
Readers' Picks: LLBO
Readers Respond: LLBO

Disclosure: VFC is long LLBO.



Since I've been asked about my sub-ten cent plays quite a bit recently, I'll continue adding those stocks to my routine comments and updates.

SIGA's Conference Call, VFC's Take

SIGA: The much anticipated Monday morning conference call from SIGA Technologies, Inc. was brief, to the point and for the most part just re-iterated already known information.

There were no stunning revelations announced and - more importantly - there was no reason given that should have long term investors panicked about their investment in SIGA.

After listening to the call and re-examining the events that transpired last week that led to a significant slide to below $5 at one point, I'm convinced that the extreme drop in price was largely unwarranted, yet compounded by those who took advantage of the announcement of an amendment to the BARDA contract and used that announcement to spread fear and uncertainty throughout the investing community, as I discussed over the weekend.

There's no doubt that there were/are many invested in SIGA to simply play the BARDA trade - that was my intent - and some of those investors may have grown impatient and bailed out on the stock, which would have added to the volatility, but it really doesn't look like anything has changed; SIGA still looks like they have the best product to fulfill the contract and it's still a waiting game - as is always the case when dealing with the government.

Regarding the timing of the stock offering announced last Thursday - just one day before the announcement - the SIGA CEO stated that the company was not aware of the pending amendment announcement at the time of the offering.

In my opinion, the government is either,

- opening up the contract to other bidders in an effort to demonstrate competition in the awarding of the contract (something that this administration is big on);

- is awaiting budget money and the contract will be announced when the funds are available; or

- feels that there is a viable alternative to SIGA's product;

- in typical government fashion, BARDA is just fumbling along in misdirected fashion and really has no idea what they're doing.

My take is this - the government can award that contract whenever they are ready to, pending amendment or not; but they can also stonewall and lumber along as if in a daze until it's time to move, but when the move is made, it'll come quick, so adjust your investing strategy accordingly after conducting your own DD.

As I stated over the weekend, I think longs had a great buying opportunity last Friday, although even as the stock is rebounding on Monday morning, I'm not ready to believe that the volatility is over. As long as the uncertainty is there, the big boys can play their games.

As always, do your own DD and invest accordingly.

Disclosure: VFC is long SIGA call options.

Saturday, December 12, 2009

SIGA: Friday's Price Collapse - A Quick Comment

It's a busy Saturday, but I know Friday's turn of events for SIGA has drawn a lot of attention and interest to the stock, so I thought I'd post a quick something before heading out and shaking off the Grey Goose....

First of all, I want to emphasize that I'm waiting until after Monday's conference call before coming to any conclusions regarding the string of events that led to SIGA's price collapse on Friday, because things that are unclear and suspicious now may be explained in full on Monday.

However, things certainly do look pretty suspicious at SIGA right now; with the timing of Thursday's stock offering just a day before an amendment to the BARDA contract was to be announced.

The question of "who knew what and when" is sure to be asked on Monday, but the truth is that we may never know exactly what transpired over the last few weeks between SIGA technologies and the contracting office.

In the same way there were "leaks" that a contract announcement was imminent, there may have been leaks that the BARDA amendment was to be released, because the shorts pounced with ferocity as soon as they saw an opportunity to jump.

Friday's extreme action also had all the makings of a 'bear raid'; otherwise quiet message boards that saw maybe five posts a day for weeks were suddenly bombarded with a slew of new IDs, all claiming to have been there all along and all claiming that they were selling and moving on (and suggesting that everyone else should, too) because SIGA was essentially a failed company and a failed stock. The normal five posts a day grew to hundreds of posts of Friday, and those posts during a short raid are intended to spread fear and misinformation as the shorts plunge the stock further than the news warrants.

Friday's drop was exacerbated by the raid; in my opinion SIGA dropped a lot further than it should have based on a turn of events that really doesn't change anything for the potential of SIGA. It's still a waiting game for BARDA and the pipeline is still in tact.

If you're a long term investor in SIGA and not just in the stock for the BARDA trade, then you're looking at a pretty good price to add shares, in my opinion, because nothing has changed with the fundamentals and future potential of the company.

However, my own investment in SIGA was strickly for the BARDA trade and I'm still sitting on March and June calls (added more of both on Friday) and a few leftover December calls (which I think it's a safe bet that they'll expire worthless next week).

Two key factors to take away from the recent events that transpired atSIGA:

- Nothing is a done deal until it's a done deal when the government is involved.

- Regardless of how promising a situation looks, it's always important to protect your investment by trading the volatility with some trading shares. In the event of SIGA, as I described here last week, I dumped most of my December $7.50 calls when they spiked enough to ensure that I came away from the investment with a profit; I only mention this because I know the riff-raff and the wolves are circling and waiting for any chance to try and discredit VFC. I always try to emphasize being on 'house money' when expected news hits.

All being said, I'm going to wait and see what is said on Monday before deciding whether or not to stick around with SIGA - and maybe even go long with the cheap shares instead of sticking stricly to my calls for the BARDA play - or just flip my March/June options and move on.

All indications today are that the contract is going to be delayed at least a few months, since the actual amendment isn't due to be released until on/about December 28th, but let's see what SIGA has to say in the conference call. Before then, it's too early to jump to any conclusions.

Regarding the December 28th date given as guidance for the amendment, I have little faith that anything will be released on that date; absolutely nothing gets done in the government between Christmas and New Years. More likely, expect news during the first week of Junuary.

As always, this is all just my opinion - each investor should do their own DD and rely on that DD when making investment decisions.

Disclosure: VFC is long SIGA call options.

Direct2Drive

Buy New DVDs

Thursday, December 10, 2009

Readers Respond: BIEL

BIEL.pk: The recent drop in the price of the BIEL stock and the resulting volatility in the stock has many investors anxious and interested. Some recent comments regarding the stock, followed by VFC's Take after each comment:



From anonymous:

I picked up 300K today at .036 and planning on adding more tomorrow. I am 100% sure that biel stock will be at mid .08 by end of this year. I also believe that apart from FDA new, if BIEL can get the audited finance report and move to OTCBB then it will go even more higher.

VFC's Take: Nice share pick-up, if the stock drops back to that level again I'll be picking up a few more shares myself.

I agree, if the audited financials come in, a move to the OTCBB is a big step up from being unaudited on the pinks, in my opinion. It adds that extra layer of legitimacy as the company looks to make a big move in 2010.

While the FDA issues could be the most market moving pending events, a move to the OTCBB would most certainly be a welcomed event for investors.



From Shep:

Nice read. Helps firm things up a bit. I certainly don't have a crystal ball, but I believe BIEL will be big someday soon. My opinion regarding all the gloom and doom talk across the boards is coming from day traders who jump in and out quickly looking for the quick strike. Joe Blow bought a quarter million at .10 and was looking for it to hit .15 a few days later. Instead we're dealing with this slow downward slide right now due to various factors. You've got to be mid-term to long in your BIEL thinking to make money I think. I've got a transfer pending with Zecco right now and am just itching to snatch up some sub .04 shares. It does take cajones to weather the storm though.

VFC's Take: The key here is having the "cajones to weather the storm."

This relates to a previous post of mine regarding exercising patience. For the mid to long term minded small investor, patience has got to be a part of the game. Since most small investors are more investor than trader, it's that much more important to conduct solid DD and base any investments on that DD.

Solid DD and a solid exit/entry strategy will give each investor the ability to "weather the storm" when things look like they could be going south.

Each investor bought into BIEL for a reason. Judging by the feedback that I get here, a lot of that reason revolves around the company's products that hold huge global potential. While the stock price has dropped, nothing has changed with the potential of the product and that is the fact that the long term investors need to key on.

Let the traders trade and make their quick moves and let the mid to long termers take advantage of the decline in price. That's not to say, however, that I don't recommend investors also having a few 'trading shares' on hand to sell into any spikes in order to reduce the overall risk of the investment.

2010 could shape up to be a rewarding year for those that were willing to stand firm on their DD.



From anonymous:

Marselus Wallace has posted his QnA session with Andrew Whelan here: http://marseluswallace.wordpress.com

VFC's Take: Great read. As I stated in my last BIEL post, however, there is no reason why investors should have to search the web for updates from the CEO or Joe Noel. If these guys are going to talk, they should talk to all investors - in my opinion - in the form of a PR or a conference call.

The constant need for investors to have to go to the Yahoo message boards to look for postings from Joe Noel or for links such as the one listed above, gives the impression that BioElectronics is just an amateur outfit that isn't quite ready for the prime time; and I don't blame jittery investors for getting nervous and bailing out.

It would be one thing if the company was just keeping quiet, but they're not - so why not issue a PR updated ALL investors on what's going on, not just those that read Yahoo boards.

On the other hand, I can't complain too much because I'm enjoying the chance to add additional shares at such a low price, but the goal of the company should not be to lower the stock price enough to make bargain-hungry investors happy.

There's always going to be something fishy about the way that BioElectronics handles certian affairs, in my opinion, mainly shady communication - but as long as they are advancing the products I see no reason to bail.



From anonymous:

hey VCF there is a very interesting pattern occurring here- TD ameritrade, scotrade and according to some reports even etrade have restricted the buying of biel shares. now take a look at ASFX, HTDS both have the identical issue, and all 3 stocks are plunging like crazy. they all have good PRs, asfx even got a FDA approval but since there is a large chunk of buyers that is cut off, they are dropping like crazy.

does this look like a naked shorting and broker manipulation or is it just me. what are our options as shareholders to investigate this? SEC wont do Sh*t


From anonymous:

Here'is some information about Ameritrade from Yahoo m/b:

"This is the response I got from Ameritrade regarding restrictions on BUY:

Good morning! I am glad to explain why TD AMERITRADE is restricting opening new positions for some securities. BIEL recently announced that they will recognize ownership or transfer of their shares only by physical certificate instead of the modern electronic book-entry system. They are encouraging shareholders to convert their stock to physical certificates.

Where companies convert to physical certificates only, it has become extremely difficult and, in some cases, impossible for brokerage firms like TD AMERITRADE to obtain shares for their clients. This can make settlement in a timely fashion difficult.

Converting to physical delivery also increases the costs associated with transferring ownership of common stock between buyers and sellers.

TD AMERITRADE is not accepting any new opening orders in such securities to reduce the risks that transactions can not be properly settled and to the added expenses associated with physical delivery of shares.

You may still sell any shares of these companies held in your accounts. Please let me know if I can assist you further.

If you have any questions please feel free to contact us for further assistance by secure e-mail or calling 888-871-9007.

We appreciate your business!"


VFC's Take: Regarding the trading issues with BIEL, I use Zecco.com to trade this stock and I've had no problem adding shares.

The whole thing sounds fishy to me - especially with ASFX and HTDS both being involved - but at the end of the mess I think that BIEL will come out on top based on the potential of the products.

I'm no fan of eitehr ASFX or HTDS, as I've mentioned here before, and both stocks raise my level of suspicion; although I know that both stocks realized some great gains for traders.

Again, if you're having trouble trading BIEL then I suggest opening a Zecco account. You don't want to miss out on adding shares at these prices - in my opinion.

As always, each investor should do their own DD and base any investment decisions on that DD.

Disclosure: VFC is long BIEL.

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Briefs: SIGA, SNSS

SIGA: Shares of SIGA dropped back into the mid seven dollar range on Thursday after the company announced a stock sale that raised the company $20 million. According to the 8k, the funds will be used for "general corporate purposes".

I'll admit that I did not expect this stock offering at this time from SIGA - I would have expected one after news hit regarding the BARDA contract - and I've got to thank Lenny, a regular at VFC's Stock House, for turning my attention to the March 2010 calls otherwise I may have been holding a few more December calls than I was today when news of the stock sale was announced.

The fact that the company decided to raise money now rather than wait for the Biomedical Advance Research and Development Authority (BARDA) announcement has me believing that the company has lost faith that an announcement is imminent, or simply grew impatient from waiting. When dealing with government entities, you can only wait so long before having to take some course of action regardless of your confidence that the deal will eventually be sealed.

Previous reports have indicated that company officials and those close to the situation felt a deal was close, so the delay could be as simple as BARDA waiting for their portion of the FY 2010 budget from the office of management and budget that the agency planned to use for the new contract.

In my opinion, and based on previous reports, SIGA is still confident that the contract is forthcoming, and therefore I'm not going with the March 2010 calls - which were on sale for significantly less on Thursday than they have been for a couple of weeks.

That being said, there is no way to know exactly what is holding up the deal, and that means that there is still a chance that the announcement could come any day. That's how the government operates - hurry up and wait, and then hurry up again.

However, SIGA may have felt the need to jump now rather than risk having to wait another month or so for a contract announcement.

The good side to Thursday's drop is that those potential investors who missed the run to ten dollars now have a decent entry point to buy in.

Whether it's stocks or options, SIGA is trading at a pretty attractive buy price once again; and the BARDA contract could still be announced at any time.

Of note, the 8-k mentioned an ongoing lawsuit with PharmAthene, and it's possible that these funds were immediately needed for pending litigation. Again, just my own speculation, each investor should do their own DD.

Disclosure: Long SIGA call options.

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SNSS: Shares of Sunesis Pharmaceuticals, Inc. rallied Thursday on an impressive run that saw the stock reach an intra-day high of $1.84, a full 131% price increase from the open.

Earlier in the week the SNSS moved higher on news that the company's lead drug Voreloxin had proved a success in a recently completed Phase II trial that measured its effectiveness in the treatment of Acute Myeloid Leukemia (AML). However, Thursday's big run has led to speculation that additional news may be pending; maybe partnership news.

That being said, those that have held this stock from at or near its 52-week lows should reward themselves for a very successful investment and sell some shares into the spike, because chances are that the stock will retreat somewhat after such an impressive run - assuming that immediate additional news is not pending.

I still like SNSS as a great long term addition to the portfolio, but that is not to say that an investor should ignore the impressive short term gains and flip a few shares as insurance towards the long term investment.

My entry/exit strategy for SNSS revolved around trading the pending Phase II news, so I stuck to my plan and sold half of my position at just over a buck and the other half at just under a buck thirty - meaning I missed out on some additional gains, but, in my opinion, you can't complain about the profits that were to be had with the gains that SNSS realized over the past couple of weeks.

With the trade play over, I'll look for any dip to start a new position with SNSS in my long term portfolio - and I think a dip may be possible after a run like Thursday.

That being said, the market cap of just under 50 million tells me that the stock could still double in short time, so I'll be looking to get back in quick on any dips.

Another factor to consider is that a stock offering is almost a guarantee sometime soon; after all, the company still needs to fund the Phase III trials. The time to buy back in may be after an offering is announced.

Disclosure: No position.

Dolan’s Money Revolutions

Wednesday, December 9, 2009

Briefs: GNBT, VNDA

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GNBT: Shares of Generex spiked 15% on Wednesday on double the norm volume after the company announced that it had entered into an insulin supply agreement with Sanofi-Aventis.

The mid day press release stated that a German subsidiary of Sanofi will supply Generex with the insulin needed to produce Generex's spray-mist insulin delivery product, Oral-Lyn, for clinical trials and - if the trials are proven successful - for commercial production.

The deal with a big player like Sanofi also brings and additional level of legitimacy to Generex and Oral-Lyn, in my opinion, for those that have been sceptical about the company and the product.

Recent news has been encouraging for Generex and its shareholders, in my opinion, and the stock is still trading in what I consider to be a decent BUY zone.

Additional good news leading up to interim Phase III results could push GNBT towards the one dollar mark over the next few months; and if the Phase III results are positive, I expect a big move from this stock because I believe that the Oral-Lyn spray that delivers insulin through the inner lining of the cheek vice using a needle (or the lungs, which is the method of delivery for Mankind's insulin spray).

Disclosure: VFC is long GNBT.



VNDA: Shares of Vanda Pharmaceuticals traded twenty six cents higher on Wednesday after Jefferies & Co initiated coverage on the company with a rating of 'BUY'.

They BUY rating from Jeffries comes as the commercial launch of Vanda's schizophrenia drug Fanapt is imminent, and with powerhouse Novartis partnered to commercialize the product, the immediate future of this company is looking bright.

In addition to Fanapt, Vanda also has a sleep-aid drug, Tasimelteon, in the pipeline and according to the company's webiste, Vanda hopes to file an NDA with the FDA in mid-2011 for the product.

Of note, Titan Pharmaceuticals (TTNP) will receive up to ten percent royaltiy for sales of Fanapt due to a pre-existing licensing agreement.

Disclosure: No position VNDA, long TTNP.

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Stock Watch, Thursday: CVM, BIEL

FreshPolos.com, Inc.

CVM: With a late day surge of nearly twenty cents on Wednesday, CVM will be a stock to watch during Thursday's trading. Investors will be looking for indications of whether or not the move was for real - and marking the end of the recent downtrend.

With a late day surge like the one CVM enjoyed, it's possible that news is brewing and a PR is pending, but it's also possible that it could just be another head fake - possibly the result of manipulation - and the stock will continue to trade down for the short term.

In my opinion, the volume that accompanied the late surge would indicate that the spike was more than just a fluke.

As followers of Cel Sci know, news should be imminent regarding the validation of the Baltimore area Multikine production facility, which should be shortly followed by an announcement that the long awaited Multikine Phase III trial has commenced. For those that may be new to Cel Sci, Multikine is the company's head and neck cancer immunotherapy treatment.

An update from the LEAPS H1N1 trial at Johns Hopkins could also come at any time, and if positive, the CVM stock should respond accordingly.

On a lesser note, the website 'Motley Fool' released a late day article that gave CVM a mention, but it's likely that the Fool was just playing the 'search for clicks game (a la TheStreet.com)' with a popular stock because the article had little relevance to Cel Sci or its stock.

Anticipation is growing for shareholders of CVM, and Wednesday's late day surge only adds to the excitement.

Therefore, CVM is a stock to watch for Thursday.

Disclosure: VFC is long CVM.

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BIEL.pk: After BIEL's significant price drop on Tuesday, I wrote that I still considered BIEL a nice mid to long term pick, although I continued to be sceptical of the lack of communication from the company.

Ordinarily a lack of communication from a company does not necessarily bother me because I don't like fluff - when there's something to say, then say it. This is investing, not therapy and I don't need to be coaxed and coddled with fluffy updates that say nothing.

However, in the case of BioElectronics the lack of an update from the company regarding recent events - like the very important FDA applications - is quite disturbing only because the BIEL spokesperson, Joe Noel (if it's really him), continues to take to the Yahoo message boards to keep investors 'updated' on company events.

If BioElectronics - with a potentially ground breaking technology and product - is looking to start playing with the big dogs, then the company is going to have to start acting like they belong there. If it really is Joe Noel that is passing information through the message boards, and that information is not being supported by a press release, then the management team at BioElectronics is partly to blame for the large amount of scepticism that is being directed at the company these days, and the amateur moves are playing right into the hands of those that would like to drive the price of teh stock down - in my opinion.

That being said, I'm confident that the company has big plans for 2010 and I still believe that the products will be looked at as a safe and effective alternative to Acetaminophen and Ibuprofen on a global scale. Slowly, but surely, the consumer is looking for safer and healthier alternatives to products that pose significant health risks than have been the accepted norm for too long. According to published reports, Acetaminophen messes with the liver and Ibuprofen with the kidneys; as I've said before, I like to save my liver damage for Grey Goose, not Tylenol - and ActiPatch offers a nice alternative to the alleged liver-damaging effects of Tylenol.

Mid to long term minded investors should take advantage of the current drop in BIEL stock price, in my opinion, because eventually the company will start talking - and if they start talking in the form of FDA approvals, then the stock could move up very quickly.

Wednesday's tease to just under four cents could indicate that a further drop is in store for the very near term, and if that's the case I'd consider it a gift to buy more shares of BIEL in the three cent range.

Long term investors who are confident in the future of the company just need to stomach out the dip in price and trade on their own DD, not the volatility of the day.

However, it's the recent volatility in the stock, and the possibility of pending news, that makes BIEL a stock to watch on Thursday.

Tuesday, December 8, 2009

Briefs: BIEL, CSUH

BIEL.pk: Shares of BioElectronics essentially collapsed during late afternoon trading on Tuesday when the stock dropped to a low of .041 cents before recovering slightly to close the day at .049.

The drop definitely raised some eyebrows as many longs wondered if something went wrong with the FDA applications and shorts were quick to cry doomsday for the company.

In my opinion, there's still no reason to question the mid to long term potential of the company, but there is also reason to remain sceptical about some of the recent activities of the company and the stock.

First off, I'm sticking with BIEL for the long term, based mainly on the fact that I believe that the company's products have the potential to gain market share as healthier alternatives to Acetaminophen and Ibuprofen on a global scale - especially since consumers are beginning to take notice of the health risks associated with those medications. Since I believe that ActiPatch and the sister products will be winning products, I jumped at the chance to add shares today on the dip. I missed buying at the bottom, unfortunately, but I was able to pick up some shares for .045 cents.

If the stock drops even more than it did on Tuesday, a possibility in my opinion, I'll add even more, depending on any associated news that may be released in conjunction with the stock action.

While it's no secret that I'm sticking with BIEL based on the potential of the product, there's still enough going on to keep investors sceptical and on edge. Tuesday's trading may have been a demonstration of just how on edge - and impatient - BIEL investors have become.

The biggest cause of uneasiness for BIEL investors of late has been, in my opinion, the lack of information being released from the company - especially regarding the FDA applications. The silence from BioElectronics is almost deafening and I do not consider Yahoo message board posts from spokesperson Joe Noel an update from the company. To the contrary, the fact that Noel had resorted to using the Yahoo message boards to communicate with shareholders did more to hurt the image of the company than help. Quite simply, it's a demonstration of un-professionalism from BIEL, and shareholders deserve better.

Unless news from the company itself is forthcoming, investors are going to be antsy; and antsy investors means volatility like we saw Tuesday.

I'll play the volatility because I believe that eventually the product potential will overtake the recent shortcomings, but it's still worth selling into the spikes with this one.

However, the sudden drop and subsequent recovery in price could also be an indicator that news is imminent, making BIEL a stock to watch for Wednesday.

Disclosure: VFC is long BIEL.



CSUH: Shares of Celsius Holdings dropped back into the mid twenty cent range after an early morning PR announced that the calorie-burning Celsius beverage was making an additional move into the South.

BI-LO supermarkets, located in North Carolina, South Carolina, Georgia and Tennessee will begin carrying the Green Tea Raspberry Acai and sparkling Wild Berry flavors of the product.

While additional distribution is always encouraging, the BI-LO news will likely be received by investors as a teaser, since many investors are awaiting news of a Wal Mart or Costco deal.

BI-LO has 215 stores throughout the south, according to Tuesday's PR.

Disclosure: VFC is long CSUH.

Readers Respond: Misguided Feedback

An anonymous comment from someone who is seemingly attempting to misrepresent the truth:

Hey VFC -- How come you seem to own every small-cap bio that's moving higher but when I check back in your archives I find no mention of you ever discussing them? Like today, with SNSS and PCYC -- you say you own them but when did you ever talk about these stocks before? Did you buy these stocks today?

I mean no offense, but fair is fair. You should think about posting your full portfolio -- winners and losers -- so we can see what you own and when.


VFC's Take: While I encourage constructive feedback, I do ask that the feedback at least be based on a little bit of effort or DD on the part the person giving the feedback. In the case of this comment, it's simply either an intentional untruth or just pure laziness.

I've stated this many times before, the Google search tool at the top of the page is the easiest way to search my site for previous posts regarding a certain subject or a stock. I know from looking at my web page stats that many readers use that tool dozens of times a day to find what they're looking for.

Whoever posted this comment obviously did not either use the search tool OR look through the blog archives (as so claimed) because I've written at least nine updates on PCYC over the past year or so and have mentioned the stock in related posts numerous other times.

Here's the first time I called PCYC a good long term pick on the blog - dated June 7th, 2008. A quick, ten second search will show you the rest.

As for SNSS, this one was very recently tipped to me by a reader and I first posted an update on this stock on December 5th - and I also mentioned that I was long at that point.

So, Since all posts of the current month are listed on the right side of the web page, I find it hard to believe that this anonymous commenter looked too hard through the archives to see if I'd written on SNSS before Monday.

I try to put some constructive effort into this blog, so I would appreciate it if any feedback is met with some constructive DD rather than attempts at misleading readers. In this case, it would have taken about 35 or 40 seconds of DD to see where I stood on these stocks and for about how long I've followed them.

As for the suggestion that I post all of my holdings and trades - that's just not feasible and defeats the purpose of what I do here.

First of all, this is a non-subscription personal opinion blog. I run it as a hobby and my only financial benefits to keeping this blog going are through the pay-per-click Google text ads and the commission-based Linkshare picture ads. I've run the idea through my head of posting my active holdings and trades on the blog, but when considering the extra time and effort that I would need to dedicate to this hobby, I just didn't think that would be feasible at this time. I like the way the style/format is going and it's likely to remain this way unless for some reason this were to become more than a hobby for me.

Additionally, the point of this blog is not to convince people to do what I do, but to share ideas, tips and investment strategies. I don't think that looking at a listing of what someone else owns does anyone any good at trying to come up with an investment strategy of their own. Merely looking at holdings does not tell the full story - and that's what I like to concentrate on; thought processes and strategies.

For instance, Jim Cramer asks people to pay up big time to follow his trades, but I think that feeds into the 'take the easy way out' syndrome - let someone else do the thinking for you. What I believe in is each person having the knowledge, resources and confidence to think for themselves in the investing world and not simply look at a snapshot of someone else's holdings.

That being said, I often post in my updates when I am buying, selling or accumulating a particular stock. If you're looking to see what I've been doing with a particular stock, I suggest the Google search tool at the top of the page.

I appreciate the readership, but I do ask that if you're going to come at me with misguided facts, at least do a little bit of DD first to see if I actually have posted about a stock, rather than just assuming that I haven't.

I mean no offense, but fair is far.

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Briefs: SNSS, PCYC

SNSS: Shares of Sunesis Pharmaceuticals, Inc. reached the sixty cent mark in after hours trading on Monday, when the company announced positive Phase II results for the lead drug Voreloxin in the treatment of Acute Myeloid Leukemia (AML).

Shares are likely to continue an upwards spike on Tuesday - a double to a market cap of about thirty million wouldn't surprise me - although I think that potential investors will be offered additional buying opportunities in the near future because the 'End-of-Phase 2' meeting scheduled with the FDA is not scheduled until the first quarter of 2010, according to Monday's press release.

SNSS is likely to trade with high volatility until the start of Phase III, in my opinion, and investors can buy the dips.

Vorelexin is also being investigated for effectiveness for Ovarian Cancer and another product, SNS-414, is being tested against solid tumors.

Short term volatility aside, I think that Sunesis has become a great mid to long term speculative pick that could at least triple over the course of the next year.

As always, each investor should do their own DD and base an investment on that DD. My blog posts are only my opinions.

Disclosure: VFC is long SNSS.

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PCYC: Shares of Pharmacyclics traded up on Monday after the company announced encouraging results from a Phase I trial that showed its Btk Inhibitor PCI-32765 is safe and effective in treating patients with relapsed or refractory B-cell non-Hodgkin's lymphoma (NHL) or chronic lymphocytic leukemia (CLL).

Additionally, positive results from a Phase I/II for PCI-24781, an oral pan-HDAC inhibitor, were presented at the American Society of Hematology Annual Meeting in New Orleans. According to the PR regarding the presentation, PCI-24781 demonstrated encouraging anti-tumor activity.

PCYC is another one that is entrenched in my long term portfolio and I'll continue to add on the dips. Barring any unforseen good news, such as a partnership or buyout rumor, I think that we'll see a price under two bucks again.

Disclosure: VFC is long PCYC.

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Monday, December 7, 2009

Readers Respond: FCSC, PWRM, NEPH, GNBT

FCSC.ob: An anonymous post regarding Fibrocell Science:

Hello VFC,
I'd like to get your opinion on a biotech that recently did an IPO (after emerging from Ch.11 BK and canceling their previous common shares). The symbol is FCSC.OB.

Any thoughts? PDUFA date is early January.

Thanks!


VFC's Take: Fibrocell, according to the company profile, is "a biotechnology company focused on developing regenerative fibroblast cells for aesthetic, medical and scientific applications."

The most advanced product in the pipeline is a treatment for moderate to severe nasolabial fold wrinkles in adults, which, as the comment mentioned above, is under review by the FDA. A decision is due on/around January 4th, 2010.

If the FDA decides to approve, the mid to long term share price of FCSC could be in for a significant boost, although I don't think that an approval is a slam dunk. While an FDA advisory committee voted 11-3 that the treatment demonstrated efficacy, eight voted that the treatment did not demonstrate a favorable safety profile while only six said that it did.

If the committee came to that conclusion, then I think that it is fair to assume that the FDA may either ask for additional information and/or another trial. However, that's purely my own speculation and I wouldn't rule out an approval delay when the FDA speaks in early January. Additionally, if the safety profile is questioned in this trial, it's likely that it could be questioned in the additional ongoing trials as well.

If I were going to play the January approval, I'd go maybe half in now and wait for news. If the approval works out, then a price spike will be in order, but if a delay is announced and the price drops, then it could be a good time to average down.

A decent speculative play, in my opinion, let's just be aware of the risks as well as the potential rewards.

Disclosure: No position.

Perfume Worldwide, Inc

PWRM.ob: An email from Baxter the Beagle regarding Power 3 Medical Products, Inc.:

Hi VFC,

I have come across PWRM as a company that seems to be on a huge explosive gain in the near n long term. What's your take on this?
Biomed reports that this is the next Vermillion. As always your advise or opinions are highly appreciated. Many Thanks

Attach is link to the report

The complete report is available now at BioMedReports.com:

http://biomedreports.com/component/content/article/56-top-leading-news/18487-ready-to-run-power3-medical-products-otcpwrm.html

Regards,

Baxter the Beagle.


VFC's Take:

Read: VFC's first take on PWRM

In short, my opinion regarding this company and stock has not changed since my first take.

If any or all of Power3's biomarker tests makes it to market, then big things will be in store for the stock price of this company.

There are hurdles - a large amount of debt, for instance - but nothing that won't be manageable on approval.

After the recent spike in price, PWRM is back into attractive buy territory, in my opinion, and if it hits below ten cents again then I'd consider it a steal.

Each investor should do his or her DD and invest accordingly, but I like the future prospects of PWRM.

Disclosure: No positions.

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NEPH: A comment from Playtrader regarding NEPH:

VFC. How about some love for NEPH. Good stuff man. Happy Thanksgiving.

VFC's Take:

VFC's Take on NEPH

I maintain my long term positive outlook on NEPH and I have this stock safely tucked away in my long term portfolio. I think that the company's 'green' potential of water purification will turn out to be a winner.

While word from the FDA remains the short term catalyst for the stock, I think that NEPH is a long term winner.

I'll be adding if it drops to below a buck.

Disclosure: VFC is long NEPH.

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GNBT: An anonymous comment regarding Generex:

Hi, What are your current thoughts on GNBT? When do you expect they will release interim results? Also, what about their risk of delisting? Do you think they will release interim result to get over a dollar for 10 days or do you expect a reverse split? What happens when a stock delists? Does it simply go on the pink sheets? Will MNKD have any effect on GNBT's price if/when MNKD gets approved? Have I asked enought GNBT questions?

VFC's Take: Shares of Generex recently spiked from the mid forties after the journal Diabetes, Obesity and Metabolism published an independent review of Oral-lyn trial results, although it is unclear from the article which trial and/or which data were used for the review. However, it is safe to assume that the data used was not from the ongoing Phase III trial or we would have seen a PR by now announcing interim data.

I expect to hear about the interim data in the first quarter of next year, although that is purely my speculation. Depending on any additional news or updates around the same time, the news may be enough to propel the stock to over the one dollar level for ten days - in which case the listing requirement will have been met, but that scenario is far from a guarantee.

Yes, I think that a MNKD approval would offer a minor, but possibly short lived spike to GNBT; essentially, I see Generex of having to support its own stock price through its own merits.

To answer the de-listing question, if the company loses the Nasdaq, then Generex would apply to be listed on either the OTC BB or PK boards.

I wouldn't rule out a quick spike to over a dollar on the right news, however; with over four million shares still short, good news could call for a bit of a short squeeze that would make this stock move quick - if good news were to be released.

In my opinion, that good news would have to revolve around interim data from Phase III.

Disclosure: VFC is long GNBT.

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Readers Respond: SPNG, AVXT

SPNG.pk:

VFC,

Do you have an updated opinion on SPNG considering they still have not filed the required financials. I am getting very suspicious and am considering selling my position.

Thanks,

Mark


VFC's Take: My opinion on SpongeTech Delivery Systems, Inc. has not changed; still highly speculative and still could go either way. The fact that we're still waiting on updated financials doesn't have me any more sceptical than I was before because I've been highly sceptical from the start anyway.

I think that it's a good sign that SpongeTech is still operating as a company and the products are still selling while the recent flurry of PRs is not a sign of a company on the way out, in my opinion.

That being said, the risk is still there that 'accounting irregularities' will haunt investors in the near future, so no one should have any more invested in this company than 'night on the town' money, in my opinion.

If you're in a position where you need your night on the town money to actually go out on the town or are getting antsy with the long wait for financials, then I would definitely sell and move on. It's my opinion that no investor should ever hold onto a stock that they're not comfortable with.

I'm still holding my SPNG shares and we'll see what happens.

Disclosure: VFC is long SPNG.



AVXT.pk: An anonymous comment regarding Avax Technologies, Inc.:

Vinny - I've done very well with your and Biomedreports' recommendations. I see a lot of action with stocks that have only one FDA application/one product that are in very early stages, even pre Stage I trials. About a month ago, Biomed had some info on Avax Technologies (AVXT) and it looked pretty good. They have one vaccine in Stage III and a pipeline of at least three other vaccines in I & II. It's trading at 8 cents on low volume. What are your thoughts on this company.

Disclosure: long on AVXT


VFC's Take: At first glance, it looks like AVXT is trading pretty well below the radar, in part because it looks like the company forgot how to release PRs, and the stock (not the company) reminds me a bit of ELTP, another one that was trading under the radar for quite some time before recently doubling on approval news. For eight cents, I think that AVXT makes for a nice, speculative, 'night on the town' play.

For those that may be new to VFC's Stock House, a 'night on the town' stock is one that is highly speculative and bought with money that would otherwise be spent on Grey Goose martinis and/or whatever other activities a potential investor would partake in during a night on the town. If your 'night on the town' stock pays off, then that's great, and if it doesn't - then at least you saved yourself a hangover.

The most advanced product in the Avax pipeline is the Phase III MVAX - a potential melanoma treatment that utilizes Avax's Autologous Cell (AC) Therapeutic Vaccine technology. The company has not released any updates on the trial, but the clinicaltrials.gov website lists the trial as still recruiting, although the MVAX trial page has not been updated in about a year.

Additionally, the company has two other supposed ongoing trials for OVax and LungVax, potential treatments for (you guessed it) Ovarian cancer and non-small cell lung cancer, respectively.

On one hand the lack of information from the company is alarming, but at the same time the lack of news allows for the stock to trade under the radar long enough to make it a potentially decent buy with night on the town money. Any positive news regarding trial updates could send the stock to a quick double, at least, but that's not to say that the potential downside should be ignored.

I definitely support a 'night on the town' AVXT buy, but I'd stagger my entrance into this stock - buy enough to not miss out on any run, but keep enough on the sidelines to add more in case the stock drops on no news offering investors a good opportunity to average down.

This is one stock that could possibly pay off sooner, rather than later.

Disclosure: No position.

Netflix, Inc.

Readers Respond: Trading Pink Sheet Stocks

An anonymous comment:

VFC,

Here is a tip for all your readers. Though I know there is money to be made on penny stocks, the pink markets are shady and underhanded. Other people are controlling YOUR money for THEIR interests. For example, the daily PPS on SPNG has been .04 - .05 for weeks now. But try to sell? No way! My orders are not being executed even when way below the last trade. There is no listed bid/ask on the pinks. Someone is making $$$ on our hard earned money. Stay away from the pinks!




VFC's Take: I agree to a point - before investing and trading stocks listed on the pink sheets, investors need to fully understand the risks and consequences of trading the pinks and also have a game plan that involves, because of the intense volatility, being able to buy and sell on the drop of a dime.

In my opinion, the pinks are definitely not a place for the 'buy and hold' investment strategy, rather investors should always be ready to trade some trading shares in order to protect profits; if for no other than reason than that there is little transparency into most companies that trade on the pinks.

That being said, I don't think that investors who have a high risk tolerance and some 'night on the town' money to spare should ignore the pink sheets; there's simply too much money to be made if you happen to be in the right place at the right time with a pink. Additionally, because a good hit on the pink sheets could turn into a gain measured by the thousands of percent, one good pink sheet hit can set you up pretty good and cover most, if not all, of your other pink sheet bets and thensome.

Don't get me wrong, it's a risky proposition and chances are that you'll never hit on the pinks, but take Titan Pharmaceuticals (TTNP) for instance - that stock went on the pinks and dropped to a cent because of a Spheramine Phase II failure and an FDA denial for Fanapt.

However, Probuphine was not dead, so I thought that a buy of TTNP for a few pennies was well worth some 'night on the town' money. That bet easily became my biggest winner. BIEL and BVTI have also been good winners.

As for the poster's statement that "Other people are controlling YOUR money for THEIR interests", I think that pretty much sums up life in a nutshell; everyone wants YOUR money to do what THEY want with it - that's why I don't like handing my money over to money managers, financial advisers, funds or Bernie Madoffs.

Additionally, while the pinks are certainly very risky, let's not get lulled into a false sense of security and think that the same games aren't played on the big boards. How often do those using stop-loss orders see their stop-loss disappear on a tree shake?

The sharks are out to get you everywhere and this poster's warnings should be heeded - but if an investor can stay on top of the game and understands the additional risk, there's no reason to ignore the pink sheets. Since using Zecco for my pinks sheet trades I've never encountered any of the trading problems that this poster has, so I cannot speak to that issue.

As always, I'm speaking from my own experiences, each investor should judge for themselves whether or not they can dabble in the pinks based on their own stomach for risk, comfort level and availability of 'night on the town' money.

Most importantly, the fact that pink sheet investing is highly volatile and highly speculative makes it fun; and if you're not having fun while you're investing, then you're not doing it right.

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Sunday, December 6, 2009

Readers Respond: SIGA

SIGA: From Lenny regarding SIGA call options:

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Hi Vinny,

Thanks for the info ...

In your opinion are the SIGA March $12.50 contracts too far out of the money?

Lenny


VFC's Take: That's a tough question that depends a lot on how SIGA trades early next week - assuming that no news is released, of course.

As I've stated here before, it's my opinion that SIGA could trade up to between $15-$20 if/when a BARDA contract is announced, although I have seen other estimates that go much higher and some that fall below that mark. In reality, the financials of the deal will dictate how high the stock can soar and no one is privvy to that information right now except for those that may be working the deal.

The rest of us are left to speculate and it all comes down to how high one thinks that the SIGA stock will go post-news. At Friday's market close, the $12.50 strikes were trading for $1.35, so I think that they could turn out to be pretty good investments if news were to send the SIGA share price to the high teens - but I also can't rule out the chance that SIGA might not even reach the mid teens; that's just the nature of the market right now when manipulation tends to rule the day more than news and potential.

The good thing about the March calls, however, is that regardless of where the SIGA stock trades right after news hits, March and June allows enough time for additional news to hit driving the stock price higher; time that the December contracts don't allow for.

Again, it's tough to make a call before seeing what happens during trading next week, but if those one hundred share trades continue to take the SIGA stock price down, the price of the options contracts will also drop and it may be offer up a nice opportunity to buy the March and June calls.

If the price drops during early week trading, I may even follow the same strategy as an insurance against my December calls - I'm hesitant to jump into December $12.50 calls, but I could support a purchase of March $12.50 calls.

Good luck with whatever you decide to do. I think that news is close.

Disclosure: VFC is long SIGA calls.

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Saturday, December 5, 2009

Readers Respond: SIGA, NVD, EPCT, SNSS



SIGA: A comment from Lenny regarding Siga Technologies, Inc.:

Hi Vinny,

For the Siga calls, can you tell me if you bought 'in the money' or 'out of the money' calls? June 2010 expirations?

Let me know if you get a chance,

Tks!

Lenny


VFC's Take: Lenny, contrary to my normal options trading, I went for the short term options this time (DEC Calls), because the prices were attractive considering rumor had it that an announcement regarding BARDA was forthcoming.

When I purchased my contracts, they were all out-of-the-money at the time, but the $7.50 contracts are now in-the-money, of course. Because I like to try and keep myself grounded and I'm well aware of the fact that news may not come before the options expire this month, I've already flipped the majority of my $7.50 calls into the recent volatility in order to make sure that I come out of my SIGA investment with a profit; however, I'll ride the ten dollar strikes in anticipation of news.

Judging by the recent volatility in the stock price last week when the stock was dropped and raised again multiple times on average volume, I've got to believe that investors and traders feel that news is imminent.

For those that don't believe news is pending this month, I like the March 2010 ten dollar strikes better than the June ten dollars; but any investors should base their investment on DD and speculation as to when the contracts will be announced.

I still think that it's close.

Disclosure: VFC is long SIGA call options.

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NVD: A comment from Steve regarding NovaDel Pharma Inc.:

hi vfc just would like you opinion on nvd its really been beatin down today im it for .40 and not realy sure what to do
tks steve in vancouver b.c. canada


VFC's Take: I've been sour on NovaDel for some time now and I am hardly tempted to buy back in even at these low prices.

Considering the fact that the company had finally found a licensing partner for each of its approved drugs - NitroMist and ZolpiMist - the future was supposed to have started looking brighter for the company and its stock, but the recent news regarding the delisting from the AMEX crushed any bit of positive speculation that an NVD stock price recovery was imminent.

The fact that the stock failed to hold any post-licensing-news gains also gives an indication, in my opinion, that investors have little faith in the market potential of NovaDel's approved products.

As always, any investment should be based largely on your own DD and if you're a believer that the products have market potential, then NVD trading with a market cap of nine million may be a decent time to buy in or double down, but if you're a believer that the company is going south, then I wouldn't hesitate to sell for a loss - I did just that, only the stock was trading for about a quarter when I sold.

In my opinion, I think that NVD is low enough at these levels to consider either buying or adding more - especially with the milestone payments due from the licensing deals. If the stock price dips to below ten cents, then I'd definitely consider it a good speculative buy.

If you're already a shareholder and are willing to hold in anticipation of a recovery, then I'd have to think that you'd also be willing to average down at these levels.

All just my opinion, any investment should be based on your own DD.

Disclosure: No positions.

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EPCT: A comment regarding my decision to bail out on EPCT:

Regarding Epicept! Sorry to hear! Things are going forward, but sadly not the share price. But it will!

For example; Not A.Collier SMythe nor Bernard Tyrell was chosen by Epicept. THEY chosed EPCT, and they probably don't want to finish their career with a failure.

EpiCept Corporation (Nasdaq and OMX Nordic Exchange: EPCT) today announced that it has appointed Bernard R. Tyrrell as the Company's Senior Vice President, Sales and Marketing, a newly created position. Mr. Tyrrell joins EpiCept with a wealth of experience in pharmaceutical marketing and business development, both in the U.S. and internationally. Most recently, he led the Oncology Division of Otsuka America Pharmaceutical, Inc.


VFC's Take: While I always stress patience in investing - especially for long term investors - I thought that there were too many other speculative stocks out there (SIGA for one) that were getting ready to move to keep my EPCT money remaining stagnant for any longer.

It very well may be that Epicept lands a European partner for Ceplene and benefits from Myriad's advancement of Azixa to Phase III trials - and I may buy back in at a future date based on that potential - but the management team has left enough of a bad taste in my mouth to keep me away for the time being.

I'll keep this one on my watch list and I wish all the best to those that still hold the stock.

Dislosure: No position.

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SNSS: An anonymous comment regarding Sunesis Pharmaceuticals, Inc.:

Hi VFC,
What are your thoughts on SNSS? Possibly an undiscovered KERX?

Thanks.


VFC's Take: I think that SNSS is a decent early to mid stage speculative pick - and we may have a better indication of just how much short, mid and long term potential this stock has after the company holds its conference all this upcoming Tuesday.

Tuesday's call is intended to discuss the new clinical data from the Phase 2 voreloxin data that was presented at the 51st Annual American Society of Hematology (ASH) Meeting in New Orleans. Voreloxin is currently being tested in clinical trials to measure its effectiveness in treating both acute myeloid leukemia (AML) and platinum-resistant ovarian cancer.

SNS-314, a treatment for solid tumors, is being evaluated in Phase I trials.

I like SNSS and its market cap of only fourteen million as a decent speculative play and all eyes will be watching this week to see if the conference call will be accompanied by significant news.

The recent run has attracted a lot of interest of late, so a small pullback could be in order as a period of consolidation while profit-takers exit the stock, but any good news released by the company during the upcoming week could re-ignite the run.

To answer the question, yes - I like SNSS as a decent, mid to long term speculative play.

Disclosure: VFC is long SNSS.

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