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Sunday, October 31, 2010

Weekly Stock Watch: AVNR, SIRI, VVUS, BVTI, VNDA

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AVNR:  After announcing the FDA approval of Nuedexta on Friday evening, shares of Avanir Pharmaceuticals will be well worth watching entering the new trading week.

The stock doubled during after hours trading once the positive approval news hit the wires, although AVNR closed Friday down 14% after some high-volumed shady trading dropped the stock to lows of $1.31 just before 3PM - hours before the news was actually released.

The 'bear raid' - similar to the ones we've seen with Dendreon (DNDN) and SIGA Technologies, for example - undoubtedly took out a bunch of stop-loss orders and allowed some big players to pick up loads of shares on the cheap - as most of the nearly 20 million shares that traded hands on Friday did so during the last hour of trading. 

The volatility likely is not done with AVNR, as Nuedexta is still at least a couple of months away from a commercial launch, so it might be worth picking up a few shares on any dips in price.  However, since this product is a first-line treatment for its target indication - and since there is no FDA-approved competition on the market - Nuedexta should hit the ground running, and 2011 could be shaping up to be a monster year for this company and its stock.

Keep this one on the watch list for the week, as any dips in price could offer up some good buying opportunities for those with a mid to long term outlook.  The short term could also prove to be highly profitable for long shareholders, although after witnessing Friday's obvious shady trading, investors need to be aware that there just might be a few more short shares that need to be covered before they let this one run. 

No longer is AVNR a speculative play; the company now has an approved product and is not too far off from having that product on the market.  On top of all that, Avanir could be an attractive buyout candidate as well.

Definitely one to watch.

Disclosure:  No position.

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SIRI:  SiriusXM is set to release third quarter results on Thursday, November 4th at 8AM.  It's already been reported that the company added 334,727 subscriptions during the quarter, so attention will be paid more to cash flow and possible updates on negotiations with Howard Stern and the NFL regarding the expiring contracts. 

Shares of SIRI traded up another five percent on Friday to close the week at $1.50, a new 52-week high, well off the nickel lows that were seen when SiriusXM stood on the brink of bankruptcy last year.

Having already realized significant gains this year, especially over the past couple of months, SIRI will be a stock to watch over the coming months based on the solid subscription growth and potential for market-moving news (mainly an outcome on the Stern negotiations).

Most longs should already have positions built, so this is more of a HOLD stock right now - in my opinion. 

That said, I'm always a fan of taking some money off the table into any spikes, so enjoy the gains, SIRI shareholders.

Disclosure:  Long SIRI.

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VVUS:  Shares of Vivus, Inc. traded on huge volume Friday, as the stock jumped 27% on news that the FDA had requested additional information regarding the safety of Qnexa, Vivus' potential drug to aid in weight loss.

Generally shares of companies that receive an FDA delay do not rally on the news, but in the case of Qnexa, many investors saw the FDA's response as a positive indication that the product might actually pass muster with the regulatory agency - once the requested information is filed - since new trials were not requested.  It could be a quick fix, and it's quite possible that Qnexa could be on the market at some point in 2011. 

I'm a little more confident in this stock now than I was when a reader recently requested my opinion on the company, mostly due to the fact that it looks like Qnexa could be a winner, but I have to believe that there will be some retracement in price after Friday's significant news before the requested information is filed and the FDA rules again.

Vivus has a robust pipeline and loads of potential, and after a big move on big volume with encouraging news, it's definitely a stock to watch.

Disclosure:  No position.

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BVTI:  Biovest enjoyed a solid week of trading last week, closing up forty cents and reaching a high on Friday of $1.82. 
 
High-volumed days on Thursday and Friday followed news that the company's plan of reorganization was approved by a bankruptcy court and that Biovest would emerge from Chapter 11 as a fully restructured company by mid-November.
 
Biovest's parent company, Accentia Biopharmaceuticals (ABPIQ.pk) also announced similar news.
 
It's been a while since I last mentioned Biovest, but BVTI has realized some very significant gains over the past 18 months or so, and these gains could just be a start if the company's immunothereapeutic treatment for non-Hodgkin’s lymphoma and mantle cell lymphoma - BiovaxID - ever makes it to market.
 
With the bankruptcy plan now approved, Biovest can concentrate on the future - and so can shareholders.
Worth the watch, and maybe worth the accumulation on any dips.

Disclosure:  Long BVTI.

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VNDA:  Vanda Pharmaceuticals will release third quarter results on Wednesday, November 3rd.  It's already been announced by Titan Pharmaceuticals that Vanda's flagship product - Fanapt - showed some significant sales growth during the quarter, but Vanda is still one to watch because of the company's positioning as a potential buyout candidate.

I still believe that Titan is the better buy right now, not only because of the Fanapt royalties that are rolling in, but also because Titan's Phase III candidate Probuphine and the ProNeura drug delivery technology hold mroe potential that anything in the Vanda pipeline, in my opinion.

Since Vanda and Titan are joined at the hip thanks to Fanapt, any Titan shareholder should always keep an eye on VNDA.

Disclosure:  No position VNDA, long TTNP.

Readers Respond: AVNR, Readers Comment on Friday's Last Hour of Trading

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A comment in response to the Neudexta approval news:

I always thought claims of manipulation were mostly the imagination of miffed message board fools. However, I have watched Avanir closely over the last 2 years and saw the evidence for myself. Friday's bear raid was only a confirmation of a very clear pattern. In the future I will always be on the look out when investing in these low cap high volatility stocks.


From Tom:

Hi VFC, Look at AVNR!! Unbelievable this is happening in America. People/Companies short stocks and scare people out of their investments and make killing profit spreading fear. I was just watching the game played by Adam F. and others like him on AVNR. Ordinary investors have to go through so much emotional stress these days to invest in Biotech and usually end up as losers. Hard to believe this day light robbery is happening while SEC and the lawmakers are keeping quiet on this crime.



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VFC's Take:  As I've stated over the weekend, I think Friday's move in AVNR during the last hour of trading - still hours before a news released announced the approval of Neudexta - confirmed for many the fact that manipulation still does exist in today's market place.  Volume went crazy and the price took a huge dip, hitting a low of $1.31 while many a small investor undoubtedly lost out when their stop-loss orders were taken out.  This move was a good example of why I don't use stop loss orders, at least not in cases where I'm protecting against an event based trade.  Games like this are too often played. 
 
That said, the big boys are going to play their games without concern for laws, morals or ethics, so it's up to the small investor to be aware that the games will be played and play along accordingly.  Sometimes that means buying when they're telling you to sell and creating an environment of fear and doubt around your stock, and sometimes that means selling into spikes, even when you know that the big news hasn't hit yet. 
 
The small investor can make just as big percentage gains as the big boys - and the small investor can move in and out a heck of a lot quicker than they can, too. 
 
The games may be disheartening to watch when you're attached to a stock, but don't let emotion effect your judgement and keep in mind that one or two DNDN or TTNP-like hits in the biotech sector could more than make up for the ones that don't pay off; because its a fact of life that most biotechs don't ever bring anything to market.  That's why the likes of Feuerstein from TheStreet.com's biotech blog always preach to the negative.  It's the easy way out (easier than offering investors a good pick every now and then) since the percentages are on their side anyway. 
 
Speaking of TheStreet's biotech blog, just as Friday's AVNR action convinced many investors that manipulation does in fact exist, the fact that Feuerstein was once again involved in a coordinated attack to the short side just raises more eyebrows about that guy's true intentions. 
 
"Where there's smoke, there's usually fire."  Isn't that how the old saying goes?  And when your boss, in this case Jim Cramer, is all over the Internet talking about how easy it is to manipulate the market, then the eyebrows are raised even more. 
 
Shady trading or not, quite a few patient longs are due to make some nice retursn on AVNR moving forward, and that's always a good thing.
 
Accept the manipulation for what it is, because the truth is - it allows the small investor a good opportunity to make some significant gains over the long run. Ask anyone who bought SIRI for a nickel, DNDN for three bucks, or SIGA for under five - it ended up working out over time.
 
Good luck out there, and don't take the trading personal.
 

EPCT: A Plan for Ceplene in the US, NP-1 Results Due

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Epicept Corporation announced last week that an agreement had been reached with the US FDA on a regulatory path to bring Ceplene to market in the United States. Ceplene, Epicept's lead product for the remission and mainteneance and prevention of relapse for patients with acute myeloid leukemia (AML) in first remission, is already approved in Europe and being marketing by partner Meda AB.

News from the FDA in regards to a Ceplene path-for-approval in the United States looks encouraging after the company received a 'refuse to file' letter from the FDA earlier this year, but the regulatory agency did not waver on the fact that it feels Epicept should conduct an additional Phase III trial for Ceplene, with the primary endpoint being overall patient survival. Epicept will soon submit a detailed Phase III protocal and move forward with this initiative, according to a press release last week, although some investors may retain hope that the FDA will eventually turn course, as did the European medical regulators, with regards to the already conducted Phase III and allow Ceplene to enter the US market without the additional trial.  However, hope is not an investment strategy, and I think that there's as much chance that Wally Backman and Tim Teufel will platoon at second for the Mets next year as there is that the FDA will reverse course in this case.

In addition to conducting an additional trial, Epicept has requested that the FDA grant Ceplene fast track status, a process that should knock some time off of the wait for an approval decision once the New Drug Application (NDA) is filed.

This could have been a nice compromise between Epicept and the FDA - you conduct an additional trial and we'll grant you fast track - but the truth is that the FDA is so backlogged and inefficient these days that a fast
track designation means little in the big scheme of things.  Even with the new trial commencing as soon as the first half of next year, Ceplene is still far from market in the United States.

Additionally, in last week's press release, CEO Jack Talley stated that the company would now "determine the appropriate next steps for funding." That means that barring a new or expanded partnership where a larger pharma dishes out a nice up-front payment for US rights to Ceplene, then some dilutive funding might be in the works. 

As the Ceplene story unfolds in the US, investors will also await sales numbers from Europe.  Any significant gain in sales overseas could provide the company with enough of a revenue stream that would calm fears of deep dilutive financing, but Ceplene has been slow to gain steam thus far. 

The most immediate event that would cause a spike in price, in my opinion, would be the results of the NP-1 trial that has recently reached its enrollment target.  However, any spike in price would be as good a time as any for the company to raise money with dilution.  NP-1 is a topical cream treatment for chronic pain.

I still like EPCT as a mid to long term speculative pick based on the potential of Azixa, NP-1 and Ceplene - in that order - and will be watching closely for any dips on which to add shares; although I don't go crazy buying this one with significant amounts of free cash because I'm still not sold on management.

What Epicept needs right now is an Azixa update and positive NP-1 trial results.

Disclosure:  Long EPCT.

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Saturday, October 30, 2010

AVNR: NUEDEXTA Approved as Longs Celebrate



The good news is that longs of Avanir Pharmaceuticals can celebrate as the company announced the FDA approval of Nuedexta on Friday evening. Nuedexta is the first FDA-approved treatment for pseudobulbar affect (PBA), a neurological condition that leads to spontaneous episodes of laughing and/or crying.

It's been a long road to approval for Avanir and Nuedexta, with previous safety concerns causing the FDA to pause, but according to Friday's press release, Avanir expects to have the product on the market at some point during the first quarter of 2011.

With no other approved treatments on the market, Nuedexta could quickly start chipping away at the analyst estimates of $350-$500 million in annual sales.  If even a portion of those predicted numbers are reached, the AVNR stock is due for some serious price appreciation, and if after hours trading on Friday is any indication, a quick double could be in order.

However, the games may still be played.

On very significant volume at just before three o'clock on Friday, shares of AVNR plummeted to a low of $1.31, before quickly rebounding to close the day at $2.42.  Volume came in at just under twenty million shares traded for the day, with most of that coming during the last hour of trading. 

Does anyone out there believe that this move was a coincidence? 

I don't think so.

In that move to the downside, someone - or a group of someones - were able to cover their short positions, pick up a whole bunch of cheap shares and take out a bunch of stop-loss orders before the news hit the wires.

It's situations like this one that remind us why using stop-loss orders in the speculative market can be dangerous, because when the big boys want your shares, it's not too hard for them to move the stock down to your stop-loss price and take them away.

I'm not convinced that there won't be any more games played with the AVNR stock before Nuedexta hits the market, but since the product is a first-line (and only FDA approved product) for its treatment indication, the growth story should move fairly quickly and it'll be worth buying this one on any dips.

Congratulations to the patient longs of this stock, and for those out there who still say that price manipulation is a myth - just have a look at Friday's AVNR chart;  the big boys will play when they want to play. 

Congrats again, AVNR shareholders.  No longer speculative, this will be a growth story moving forward.
Disclosure:  No position

Friday, October 29, 2010

CELH Volume - Or Lack Of It



Five hundred shares.

That was the trading volume for stock of Celsius Holdings on Thursday.

The five hundred share trading day followed two of the previous three trading days that saw 50,000-plus CELH shares trade hands, not a significant number, but still well above the daily norm for this still low-traded stock.

On on of those days, October 25th, shares of CELH touched the $1.65 mark - a price not seen in more than a month. A burst of high volume quickly knocked the price back down and the stock has since traded lower.

The volatile week could be some longs and shorts taking positions before the expected release of 3rd quarter results on November 9th.

However, the recent trading action still tells me that CELH is still easily controlled and/or manipulated by the same large players who have been involved for well over a year now.

Until more oustside interest is drawn to Celsius, then volatility such as we saw this week is going to remain in play; and the only way that more interest will be brought to the stock is by increased awareness and solid sales numbers.

The awareness will come with sales, in my opinion, and I'm a believer that the sales numbers are coming, with emphasis put towards the Health & Fitness and Military Exchange markets for the near future.

We've certainly witnessed an interesting week - two days of near triple the trading volume with a five hundred share trading day mixed in.

Less than two weeks until earnings, that's the short term target date of interest.

Disclosure: Long CELH.

Titan Watch: Volume

Volatility and volume were both factors during Thursday's trading day for Titan Pharmaceuticals, as the stock bounced between a low of $1.05 and a high of $1.29 on volume of nearly 600,000.

The company filed and 8K announcing that on October 26, 2010, Joachim Friedrich Kapp had resigned from Titan's board of directors, in conjunction with his sale of 558,660 shares of the company's common stock.


The drop to $1.05 was a quick and bonus buying opportunity for investors following Titan's growth story following the approval of Vanda's Fanapt last year, of which Titan receives royalties of between 8-10%.

Titan's confirmatory Phase III Probuphine trial is also nearing completion, and the ProNeura drug delivery technology also holds big potential for the future, with the NIH awarding Titan a grant earlier this year to investigate its use in Parkinson's treatment.

It's long been my opinion that Titan will eventually be bought out by big pharma, and although I don't believe that the Kapp resignation has anything to do with that, the recent spike in volume could be an indication that positions are being taken in preparation for a budding event that we don't know about yet.

TTNP is always one to watch these days, and although the volume is not yet mind-boggling, it's enough to pique some increased interest.

Disclosure:  Long TTNP.








Thursday, October 28, 2010

Brief: AVNR, Decision Pending

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It's crunch time for shareholders of Avanir Pharmaceuticals, Inc., as the FDA is due to announce a decision regarding AVP-923 this weekend, on October 30th.  AVP-923 is a potential treatment of pseudobulbar affect (PBA).  The FDA had previously requested additional information before rendering a final approval decision after positive Phase III results were announced last year.

There were some safety questions regarding AVP-923, so there's an additional level of risk to this FDA approval trade than with some others - but all FDA trades come with inherent risk because you never how the agency will react to certain circumstances and we never know who holds the most leverage and influence behind closed doors. 

There's often a lack of consistency with regards to the FDA, so sometimes it seems like it comes down to a crapshoot.

That said, Avanir has provided the FDA with the requested information, so some could ascertain that AVP-923 has a decent shot at approval this weekend.  On the other hand, the shorts are making a strong case for the opposing opinion, and TheStreet.com's suspect biotech blog is involved with this one, making you wonder if the price is going to drop after the decision even if it is a positive one.  TheStreet's biotech blog seems to always be looking out for someone other than the readers.

I still  haven't jumped in and purchased any shares of AVNR, but I'd call it a 'wet your beack' stock if you're looking to play the approval trade.  'Wet your beak' with a small amount of shares so that you're along for any run that may materialize, but I'd keep most of the cash on the sidelines and add if the stock drops next week.  That's just my opinion, but I'm not a big fan of purchasing this stock at near the $3 level.

News of disapproval (which I don't see likely) or a delayed decisions (possible) could push the stock down to the two dollar mark or below to allow the shorts the opportunity to play their games and make their money.  I'm not convinced that a positive decision would lead to any impressive spikes due to the current trends in the sector, but each investor needs to devise his or her own opinions and strategies based on individual DD.

Entertain both sides - the long and short - of the story, and place your positions, because crunch time is now - and investors are hungry for news.

Disclosure:  No position.

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BDSI: Positive Phase II for BEMA Buprenorphine

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BioDelivery Sciences announced on Wednesday that a positive end-of-Phase II meeting had taken place last month with the FDA regarding BEMA Buprenorphine for chronic pain.  As a result of the meeting, the company plans to initiate a Phase III trial later this year.

Results from the Phase III trial are expected to be finalized during the last half of 2011 with a possible New Drug Application coming in early 2012.

Shares of BioDelivery have been on the uptick over the past couple of months, after bottoming out down near the two dollar mark, and some recent positive developments have renewed the confidence of many investors that BDSI could be a nice long term growth story. 

BEMA Fentanyl - known as Onsolis in the US - has been approved in Europe and a recent announcement of a meeting between BioDelivery, marketing partner Meda and the FDA indicates that the REMS issue regarding Onsolis in the US may be coming to an end.  It's been assumed by many that the REMS situation is what has kept Onsolis from reaching its full market potential. 

BioDelivery has a solid pipeline and loads of potential with its drug delivery technology, and it should only be a matter of time before the share price begins to match the future potential. 

Disclosure:  Long BDSI.

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Tuesday, October 26, 2010

KERX Spikes on Phase III Patient Enrollment, Just Warming Up?

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Shares of Keryx Biopharmaceuticals responded positively to news on Tuesday that patient enrollment had been completed for a Zerenex Phase 3 Short-Term Study for the treatment of hyperphosphatemia in patients with end-stage renal disease on dialysis.  Results from the trial should be announced by year-end 2010.

As the short term study is winding down, a Phase III long term study is still ongoing and will not be completed until sometime next year.  Upon completion of both trials, Keryx will file a New Drug Application for Zerenex for the treatment of hyyperphosphatemia, expected to take place in the first half of 2012.

Another of KERX's product candidates, Perifisone, is being investigated in Phase III trials for the treatment of refractory advanced colorectal cancer and multiple myeloma. 

The two products make KERX a potential huge longer term pick. 

Already the stock has risen from below the one dollar mark nearly 18 months ago when I started covering it,
and investors have had ample opportunities to sell into the various spikes and buy into some dips.  While still recognizing the potential long term gains to be had with KERX, I'm still more comfortable buying this one down closer to the three dollar range than I am up here in the mid fives. 

As promising as the Keryx story is right now, the company is still a couple of years away from bringing a product to market, and these days hype alone will not keep a biotech's share price inflated, no matter how promising the products may be.  I believe there will be some time and opportunity over the short to mid term to add shares of KERX for more attractive risk/reward prices.

On the other hand, Pharmacyclics, Inc. - another company that I started covering here while it traded for right around a buck - has enjoyed a sustained price increase while also having had quite a bit of time before bringing anything to market; so a sustained rise from a speculative biotech with nothing immediately close to market can still happen, even these days. 

Keep KERX on the watch list - as always - because the potential is huge, I'm just not a big fan of the risk/reward as a BUY while the stock is trading with a market cap of over 300 million.  Any Phase III setbacks for one of the products could lead to a significant dip.

I'm more of a fan of using some trading shares to stay ahead of the game with this one, and holding long with a core group of shares.

Disclosure:  No position.

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Monday, October 25, 2010

TTNP: Fanapt Realizes a Significant Increase in Q3 Sales

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Although shares of Titan Pharmaceuticals netted a decrease in value by five percent on Monday, the early-hours news release announcing an expected royalty payment of $395,000 was good news for the company and its shareholders.  Weekly prescriptions for Fanapt was announced to have grown from 1,200 prescriptions/week at the end of June to about 1,800 prescriptions/week by late September, an encouraging trend in itself, but also a good indication that the product is gaining market acceptance at a farily rapid rate after stalling immediately after the commercial launch earlier this year.

With Novartis pushing Fanapt to pharmacies, one would figure it was only a matter of time before the powerhouse pharmaceutical giant got the ball rolling.

While Q3 numbers are encouraging given the (perceived) slow roll-out of Fanapt, they're still not where many investors (including this one) expected at this point in the launch phase.  That said, the momentum is building at this point, and although some will still paint a negative spin on these numbers, the best is yet to come.  This is free money for Titan - no expenses attached to this revenue stream - and even maintaining the current momentum in sales increases will significantly boost Titan's bottome line as the Probuphine trial winds down. 

However, it may now be expected that the rate of growth will increase, as momentum tends to build on top of itself once sales get going.  It took Novartis a quarter or two to hit the ground running, but Fanapt is starting to look like the viable product that many expected it would be. 

The positive development behind the slow Fanapt rollout is that investors were able to load up on shares of TTNP for a buck again.  That, in my opinion, is going to end up looking like a steal in the long run, just not to the extent of a steal that the penny price was last year.

I still believe that we'll see a buyout of Titan before it's all said and done.

The Fanapt revenue stream looks like it's going to become a viable commodity, and Probuphine should be a product that gains quick worldwide acceptance.  Because opioid addiction funds terrorism throughout the globe, it's in the best interest of governments to pick up the pace of weeding their citizens off the drugs, and as that train of thought picks up steam internationally, Titan could be primed to benefit from the trend. 

Later on down the road, ProNeura - I believe - holds more value than either the Fanapt revenue stream or Probuphine alone.

It keeps getting interesting for Titan.

Disclosure:  Long TTNP.

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AGEN: Expansion of Glioma Trial, Based on Early, Encouraging Results

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Sunday, October 24, 2010

MHTX: Nanotitanium and Dental Implants Have Manhattan Scientifics Back in the Spotlight

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Shares of Manhattan Scientifics made a run to ten cents back in April when the company announced that its early cancer detection technology could detect breast cancer up to three months earlier than a mammogram.  As is usual for this company's trading pattern, the run was followed by a period of retracement, although some recent developments could put MHTX shareholders on the straight path the prosperity. 

The early-detection technology that led to the last price spike is just one of many technologies held by by this company that give it a fine chance at a bright future.  . 

Also in the 'pipeline', Manhattan holds patents for various fuel cell technologies and a 'touch and feel' application for computer technology - allowing users to realistically 'feel' any object that may appear on the computer screen.

However, it's the nanotitanium and 'super metal' technology that looks to hold the most short term potential, and recent developments are an indication of just how much long term growth potential this technology holds as well.

Two recent press releases have highlighted this nano-metal technology and its use in prosthetics and dental implants.  The implants are stronger and said to graft to human bone much easier than other metals, and are already approved by the US FDA.  A deal was reached with NanoMet of Russia to mass distribute the dental implants in Russia, a potentially lucrative agreement for Manhattan. The implants distributed in Russia will be manufactured by Albuquerque-based Basic Dental Inc., also Manhattan's manufacturer for US distribution.

As lucrative as the dental implant market may be, this is just a start. 

Manhattan received a one million dollar payment from Carpenter Technology Corporation due to the terms of a licensing agreement that has Carpenter developing super lightweight metals using the same technology.  This technology has potentially huge applications in the commercial production of aircraft and vehicles of the future, and that's without even speculating on the potential military applications.

The technology held by Manhattan is real, and it looks like the hoarding of patents is starting to pay off.  The nano-metal and nano-titanium technology is putting this company on the map.  If the dental implants are such a success for their ability to graft with bone so well, it's only a matter of time before other prosthetics using this technology will start rolling onto market.

Manhattan is now cash flow positive and could just be gearing up, although I'm not convinced that we won't see anothere pullback after this most recent run.

Long term, I think we have a real winner here, but I'd have to guess that these patents will eventually be purchased by a big player; maybe even Carpenter would find it worth the while to buy them up.

Definitely stay tuned to developments with MHTX.

Disclosure: Long MHTX. 




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Stock Watch: BIEL

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Shareholders of BioElectronics experienced quite the volatile week last week, and there's enough news still pending news to keep investors wondering if the recent volatility could be an indication that something is brewing.  An 18% upswing was accompanied by a volume boost late in the trading day Tuesday, although nothing came of the move as the week bore on. 

The company is making preparations to move the trading shares to the over-the-counter (OTC) boards from the pinks, according to an investor update posted on the website earlier this month, but it's still the FDA approval news that will dominate the near term attention paid to this stock.  That news could be released at any time, and I don't think it's arguable that any OTC clearance for the BioElectronics products will add significant near, mid and long term value to the company.

As mentioned here before, BioElectronics is still expanding into various international markets while waiting on the FDA news here in the US.  The Allay menstrual therapy patch is in full launch mode in the United Kingdom, with sixty and ninety second commercial spots taking to the British airwaves.  The television campaign is expected to generate nearly three million impressions, according to publicly released information, and may reach as many as 95% of all UK households.

Sales generated from this campaign will not be included in the next quarterly announcements, of course, but the focus on international growth should be viewed as a positive endevour while the FDA employees sit in Washington twiddling their thumbs while eating New York-wannabe dirty water dogs during their two and a half hour lunch breaks.

BIEL has been known to move every now and then on no news, recently reaching the two cent mark, but BioElectronics continues to be a waiting game for investors. 

It's not a waiting game for management, however, if the commercial launch of Allay in the UK is any indication.

Let's see if the recent volatility is telling us something, or is it a non-factor as the waiting game continues?

Disclosure:  Long BIEL.

Weekly Stock Watch: DDSS, ONTY, SIRI, TTNP

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DDSS:  Labopharm also headlined last week's Weekly Stock Watch, and after a seven percent close to the upside on Friday - on volume triple the normal trading average - DDSS will be a stock to watch heading into the new week as well.

This stock has often provided investors with soft teases in terms of temporary price spikes, but with the rate of encouraging news releases picking up over the past couple of months, there's no doubt that Labopharm has some pretty significant long term potential. 

As noted last week, Labopharm's twice-daily tramadol-acetaminophen product received a positive opinion by European health regulators and will be launched in multiple European Union countries by late 2011, if not earlier.  The company's treatment for major depressive disorder (MDD), OLEPTRO. is already on the US market, although still in the early stages of commercialization.  Also on the OLEPTRO front, news is still imminent regarding a regulatory approval in Canada.

Friday's move on triple the average volume could just have been investors lining up for a possible news release early in the week, but with positive developments picking up steam of late, DDSS could be gearing up for a definitive move to the upside, one that might stick this time.

There's still risk involved - as there is with all stocks - there's always the chance that OLEPTRO or the twice daily product in Europe won't catch on and that Labopharm will never become the solid growth story that many predict, but I like the chances of DDSS producing significant mid to long term returns for investors as the growth story unfolds.

Friday's trading action makes this a stock to watch, at least for another week.

Disclosure:  Long DDSS.

Got A Virus

ONTY:  Oncothyreon is another company whose shares traded on big volume Friday.  Robert Langreth of Forbes.com released an article just before noon discussing Dendreon's Provenge and the future of cancer vaccines.  According to Mr. Langreth, eyes should be turned towards lung cancer as the next big indication to be targeted by manufacturers of cancer vaccine therapies. 

Oncothyreon's Stimuvax, partnered with Merck KGaA (the same Merck with whom Generex recently signed on as a distribution partner), received honorable mention by Mr. Langreth as a "vaccine to watch," due to the product's ongoing late stage lung cancer trial.  The article did not delve into detail, but the mention was enough to spur a spike in interest, as volume picked up right after the article release on Forbes.com. 

Friday's volume and the mention in Forbes may turn out to mean nothing, but if this one starts receiving some headline attention by the mainstream media as a possible 'next Dendreon', then things could get interesting in a hurry for this stock.  ONTY, which was trading for under a dollar less than two years ago when VFC's Stock House started following the stock, has already realized very significant returns for investors, and if Stimuvax turns out to be for real, then another Dendreon-like jump could be in the works.

Always keep in mind that investments in cancer vaccines are highly risky, as many never see the light of day with the FDA, but DNDN is all you need to look at to see the potential returns that one good hit could bring for investors.  The biggest returns, however, are the benefits experienced by the patients who will enjoy a better quality-of-life treatment while potentially not having to battle the vicious side effects of chemo and radiation treatments.

Disclosure:  Long ONTY

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SIRI:  It's hard to believe that this stock traded for under a dime just a year and a half ago, when the global economic system stood on the verge of collapse and everyone from Jim Cramer to Warren Buffet told us to sell everything we owned.
It just goes to show you how far a good-looking risk/reward play can bring enough returns to have you playing on house money for a long time, at very minimal risk.  Some saw a buy of SIRI at six cents at that time as nuts, but the ones that loaded the boat while the company was on the verge of bankruptcy are laughing all the way to Cabo.

I've said it often - all you need is one big, speculative hit to be set; one TTNP, one SIRI or one DNDN. 

As we know, SIRI has rebounded - in a big way - from the six cent lows and the company looks to be on the up and up.  Subscriptions are growing, popularity is growing, and the content offered is also growing in quality.

Of interest on the content front, Howard Stern's contract with Sirius is due to expire in the not-so-distant future, and although speculation has it that he will remain, there's no telling how his departure would effect the subscription base.  I'm inclined to believe that the impact would be minimal, as SiriusXM has a lot more appealing content to offer than just Stern, especially on the sports front. 

With car sales on the rebound and the quality of programming on the upswing, subscribership is growing and the stock has reacted accordingly, trading for roughly $1.30 as of Friday's close.  The buck-thirty trading price is a far cry from the nickel lows seen when doom and gloom ruled the day.

SIRI is due to release third quarter results on November 4th, and investors will be watching closely to see if the recent rise can be sustained, or if there will be a tail-off in new subscriptions that may justify a downturn. 

With the economy on the rebound, SIRI once again looks like a nice longer term play.   

Stay tuned for the quarterly results.

Disclosure:  Long SIRI.

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TTNP:  Titan is pretty much worth adding to the permanent watch list for the next few months as the Probuphine trial nears an, but next week will be especially interesting after TTNP rated a mention in TheStreet.com's biotech blog

The timing of the mention - shortly after a nice rise in price - and the fact that the stock closed up for the day even after the negative mention makes one wonder if bigger news could be close for Titan.  It's always been my speculation that Titan would be bought out before Probuphine ever made it to market.

In Feuerstein's blog, he tends to follow-up his mentions with all-out hack jobs - especially when his first attempt to drop a stock fails - so it's likely we could see more from him regarding Titan Pharmaceuticals.

The general consensus has his post being off-base and unreasonably pessimistic regarding the potential of both Probuphine and Fanapt, so it could be that AF is a non-factor regarding this stock.

He doesn't seem to have it out for this company on a personal level than he does some others.

Worth watching. 

Disclosure:  Long TTNP

Saturday, October 23, 2010

Titan Pharmaceuticals - Rates a Mention on the Biotech Blog

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TheStreet.com's biotech blog turned a negative spin on the recent positive developments at Titan Pharmaceuticals, yet shares still closed the day higher by three percent. Granted, the blog guy didn't come after Titan like he has some other companies, but the fact that Titan gets a mention on the biotech blog just reaffirms my position that the company looks ready to rub elbows with the big boys. It also inclines me to believe that there might be more attention on Titan than we think, because I'm not one to believe that TheStreet.com's biotech blogger spends time on a company unless there is an ulterior motive involved.

Sometimes it looks like Feuerstein - TheStreet.com's biotech blog guy - is a last-resort hired gun, foreither Jim Cramer or some of his hedge fund cronies. When they need a stock to drop so they can short or buy-in at a discount, then they order their favorite lackey to publish a negatively tuned blog posting to coincide with their attack on the share price. It's the attack on the share price that I believe causes the stock to drop - not his blogging - because I find it hard to believe that the average Joe who reads his stuff would sell just because he doesn't like a stock. With that logic, no one would even invest because Feuerstein doesn't like anything.

To carry out his orders of negativity, Feuerstein employs tactics such as resounding bias, half-truths and subtle deception - if not ignorance - while penning his postings. In the case of Titan, he doesn't like the potential of Fanapt and Probuphine has no market. Great, no surprises there from this guy.

However, since TTNP just enjoyed a more than thirty percent price increase over the past couple of months or so, it was only a matter of time before he chimed in. I'm willing to bet that he first read about Titan on VFC's Stock House or BioMedReports, the places where I suspect this guy gets his tips.

The coming months will be enticing for Titan, with or without TheStreet.com's biotech blog.

We had enough time at the dollar level to re-load the shares sold in the mid-$2 ranger following the run from a penny, so I'm in HOLD mode, unless we dip back down to a buck.

Disclosure: Long TTNP.

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Friday, October 22, 2010

Readers Respond: Generex, the Diabetic Use Of Needles and Preventative Medicine

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A follow-up from Clancy in response to comments made after the latest news from Generex:

Hello Vinny,

Some further thoughts on GNBT:

The only reason I mentioned about diabetics "used" to needles comes from a friend's wife who is a severely obese diabetic. She said the needles are very thin and she barely feels it. Furthermore, she still would have to poke her finger for blood samples with a lancet and that hurts her more than the thin needles for the insulin. Again, this is ONLY a sample of one but I would assume she is not the only severely obese diabetic with this view. I doubt a newly diagnosed diabetic without experience with needles would opt for a needle. Perhaps there are three categories: diabetics who are content with the needles, those who long for a technology change, and the newly diagnosed who wouldn't consider a needle if a viable alternative was available. I think to categorically say all diabetics would switch is not necessarily true.

Also, there is the question of insurance reimbursement. It depends on the quality of the diabetic's plan. A certain proportion of the population who are prediabetic crosses into full diabetes from improper diet often associated with, but not only attributable to, low income. Many of these people are minorities with either no insurance or minimal insurance. Their plans may not initially cover Oral-lyn. I suspect, however, that if insurance companies don't initially cover Oral-lyn eventually they will when it is show to lower long term medical costs with greater compliance.

Clancy

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VFC's Take:  Clancy, thanks for clarifying your comments regarding diabetics being "used to" the needles and would not switch to Oral-lyn, should it be proven to be an effective alternative.  This issue has been discussed on VFC's Stock House at length in the past and I have to admit, that your comment is the first that indicated that diabetics may be more apt to remain with the needle than make the switch.  I'm not denouncing the fact that some would prefer the needle, but based on conversations we've had here and based on conversations I've had on a personal basis, I'm inclined to believe that most diabetics would jump at a needle-free alternative, especially parents who are having to inject diabetic children with the needle-delivered insulin. 

I've also found through my discussions that people who are obese tend to not feel a needle injection at the same scale of those who are only have a thinner layer of fat.  That difference may also have something to do with the preference for a needle, and this argument would corraborate your case since the woman's fingertip undoubtedly does not have the thick layer of obesity as the injection site would.

Any additional opinions or personal takes on this issue are welcome.

I agree with the statements of reimbursement, and I think that you bring up an interesting point - the fact that prediabetics often become diabetic based on diet.  Prevention is the best medicine - although one that is rarely addressed in the American Health Care system because all the money is in treatment. 

Health care should be geared towards prevention, but as Clancy states, there are other factors involved, such as income levels. For some, the availability of a garbage, processed hamburger for a buck may seem like the best option at the time.

Education is also a factor - if you don't recognize the threat of eating garbage and sugar all the time at an early age, then the health problems that arise later in life come as a surprise.

Laziness is another factor - how many parents out there fill their kids with fast food day after day because it's more convenient than cooking some chicken and fresh vegetables? 

Not to digress from the issue at hand, but this is a broad problem that needs to be addressed in society as a whole, BEFORE we go bankrupt through the current knee-jerk health care bill shoved down our throats by Washington.

VFC's News House:  The Pre-Existing Condition in Health Care, Health Care Comments, Controlling the Cost of Health Care.

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CELH: An Expanded Move Into the Health & Fitness Market

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Celsius Holdings, maker of the growing-in-popularity, calorie burning pre-workout drink announced after the market close on Thursday that Celsius had significantly broadened distribution into the health and fitness channel. 

Of note, new authorizations include Gold's Gym, Smoothie Kings and expanded distribution within a premier athletic facility chain whose cafes and vending machines operate in over 85 large sports, athletic, fitness and family recreation centers across 19 states. 

The recent push into this market is one that has been awaited by shareholders for quite some time, and the new sales locations are looking like an early payoff to the Europa deal that was consumated not too long ago.

After a somewhat quiet summer, it could be argued that the Celsius brand is facing a rejuvenation with significant pushes into the military exchange and health & fitness markets well under way.  I'm also a fan of the new flavors, Lemon Iced Tea and Strawberry Kiwi.

Quarter three results are just weeks away, and if those results come in line with expectations set after the second quarter results, then the solid bargain prices that shareholders have seen to accumulate of late could quickly become a distant memory. 


Here's a company that has slowly and methodically built a brand from the bottom up, brick by brick, and the long held vision of CEO Steve Haley and others from the management team could be on the verge of being fully realized.

CELH is once again a stock to watch, and we could be nearing another significant run - although probably not to the extent of the last real run that included percentage gains in the thousands. 

Keep an eye out for pending developments.

Disclosure:  Long CELH

Infection Prevention Week: The Fight Against HAIs

It may be safe to say that everyone knows someone who has suffered from a Healthcare-Associated Infection (HAI), and these infections could not only be very dangerous to a patient's health, but could also lead to serious illness or death. 

Kimberly-Clark Health Care is leading the fight agains HAIs, and since I spend a lot of time covering and throwing my opinions around about the health care sector, I thought it was relevant to mention the Kimberly-Clark initiatives.

Please take note of the following from Barbara Dunn:

Hi

As you may be aware, this week is International Infection Prevention Week, the largest annual initiative to promote safe, hygienic hospital practices and stop Healthcare-Associated Infections (HAIs) before they happen. Although all HAIs can lead to dangerous outcomes, what you may not know is that Ventilator-Associated Pneumonia (VAP) is the HAI most likely to cause death.

Leading the fight against HAIs, Kimberly-Clark Health Care is dedicated to preventing VAP through its new VAP Solutions website and social media networks. The sites are accessible to all clinicians, making it easy for them to share information and successful strategies with each other and—most importantly—to help each other protect vulnerable, ventilated patients.

I've created a microsite which explains everything:
http://vap-news.com

For readers that my be looking for more information, or looking to become more involved with this initiative, please read the following and visit the below website:

Kimberly-Clark has launched a new online program - the HAI WATCHDOG* Community - where healthcare providers can discuss best practices for defeating HAIs. The goal is to help eliminate these often preventable infections through discussion and education.

The HAI WATCHDOG* Community allows members to start discussions, post photos, videos and even enter the 2010 HAI WATCHDOG* Awards. Entering the awards program not only allows healthcare providers to share and learn from each other, but also gives contest participants the opportunity to be rewarded for their efforts with an educational grant.

I've created a microsite which explains everything:
http://haiwatchnews.com

I appreciate Kimberly-Clark allowing VFC's Stock House - a website based mainly on opinions and stocks - to share this information with readers.

The following advertisements are unrelated to Kimberly-Clark:

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Thursday, October 21, 2010

GNBT: Readers Respond to the Reverse Split That Never Was

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A few readers responded to the news of GNBT moving to the OTCQB upon opening bell Thursday:

From Ives:

Hi Vinny,


Why was there such a backlash against Generex Biotechnology's management? Would those who voted 'no' rather the company get involved in another nasty financing as in 2008, causing even more dillution then was feared with this proposal? I think many 'scareholders' shot themselves in the foot. I wonder how many of them are flippers vs. true investors. I think management had good intentions despite what was said on various boards. As Kaelyn said, "Where do we go from here with Generex?".

Regards,

Ives

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VFC's Take:  The backlash against management stems from years of perceived mismanagement.  If Oral-lyn is so good, investors will ask, then how could a management team fail so miserably at bringing in partners and/or keeping the share price above a dollar? 

There is some validity to that question.

The reverse split may not have been received with such backlash had it not been dropped on investors at the seemingly last minute looking like an attempt to shove something down the throat of investors in a manner that ensured the insiders were protected, but not the common shareholders.  The shakeups and the drama over the past few months made the company look like an out-of-touch group of amateurs and many investors lost confidence that they could bring even a potentially blockbuster product like Oral-lyn to market.

I changed my vote to 'yes' for the RS, but I certainly am not afraid of the OTCQB.  If Oral-lyn truly is the revolutionary product that it has been proclaimed to be, then GNBT will be well north of a dollar before too long.

Where do we go from here?  The company needs to move forward and concentrate on bringing Oral-lyn to market.  Period.

Investors need to weigh the information that's out there and devise a plan accordingly.  I'm sticking to my strategies, which include buying on any dips and selling some trading shares into any spikes.

Also, Ives brings up a good point - a large portion of the investors in these speculative stocks usually don't have the best interests of the company or the patients that would benefit from a developing drug or product at heart; they've got themselves and their own finacial interests at heart.  Some become so consumed by greed and the desire to make that extra couple of bucks, that they lose touch with any reality aside from their own - there's plenty of hedge funds out there that have reached that point, and is there anyone out there more greedy than Jim Cramer, the epitome of the hedge fund manager? 

The consequences of the recent economic demise should be a pretty good indication of where greed actually gets people.  Some get rich, but a whole lot of people lose their jobs, and then - ironically enough - it's those that are losing their jobs that have to bail out the guys that put us in this position in the first place.

Thanks for the comment.

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From Kaelyn:

Where do we go from here with Generex?


Kaelyn


VFC's Take:  Generex is - and always has been, at least recently - an investment in Oral-lyn.  Absolutely nothing has changed on that front, so we move forward with following the development of Oral-lyn.  If Oral-lyn is deemed a success, then GNBT shares will significantly rise - again, nothing has changed on that front. 

The only new issue at hand is whether an investor wants to buy now into any dips, hold for news, or sell until he or she is more comfortable with the stability of the company.

That's for each investor to decide.  I'm still following the Oral-lyn story closely.

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From Clancy:

How long do you think it will take Generex to recover? Is this now dead money pending an announcement on Oral-lyn? Why do you think this will ultimately be big if it passes testing? Aren't most diabetics used to shots even though they certainly are not pleasant? Lotto play or shrewd mid to long term play? If nothing else, it gives entertainment!


Clancy


VFC's Take:   How quickly GNBT recovers depends on how quickly good news is released.  The quicker the Oral-lyn results are made public the better, although if they are not positive, then the stock may never recover. 

I don't consider GNBT dead money, because there is so much pending for the future.  I still expect volatility and opportunities to acquire a few more shares - hopefully we see twenty seven cents again, I liked that yesterday - and there just might be a spike or two into which we could sell some trading shares along the way.

I must say, Clancy, I cannot speak for most diabetics, but I have to question your logic with your statement that diabetics will not move away from shots because they are "used to" them;  only a diabetic can address that issue, but I think that common sense would dictate that any person with a sound mind would rather NOT stick themself with a needle if they didn't have to. 

Thanks for the comment.

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Another approach to the news, this one not concerning Oral-lyn, but the rest of the pipeline:

WE need news about AE37!!!

VFC's Take:  Here's a new appraoch, let's see news on the cancer vaccine front.  While this pipeline is rich in possibilities, I think that AE37 is more valuable to the company as a sale than as a future product candidate, at least for the time being.

I like what the CEO of Cel-Sci Corp had to say in a recent webcast; a developing company should dedicate the large majority of its resources to advancing the flagship product to market before worrying about the rest of the pipeline or back-up plans.

AE37 certainly has potential, but I think that Generex should be 100% dedicated to Oral-lyn right now, and I believe that current management feels the same way, judging by the statement Mr. Fletcher made in a recent conference call regarding Generex returning to its 'core business.'

Let's see what happens. 

I think a partnership for that product is more likely than one for Oral-lyn, but maybe not as lucrative.

Disclosure:  Long GNBT.

Readers Respond: A Reader Questions VFC's Stock Picking Ability

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From an anonymous (of course) reader regarding VFC's stock picks:

VFC is the worst stock analyst I had ever seen. Most of his recommended stocks go down at least 50%, some even down over 90%. Look at BIEL, GNBT, CSUH, CBAI aand many more. Beware of this dangerous guy!!!

VFC's Take:  I'm not going to take too much time on this one, because every reader has the option of using the Google bar posted at the top of my blog to type in a stock symbol and find my previous posts - there's nothing hidden here.

First I'll address this anonymous reader's proclamation that I am a stock analyst.  I appreciate the respectful title, those guys get paid pretty good (especially when they analyze stocks for unscrupulous motives), but alas VFC is just a guy with an opinion - as is noted in the first seven words on the top of this page.

Addressing the aforementioned stocks, each of the above is highly speculative and highly volatile.  It's easy to take various points in time for any particular stock to paint a picture in a negative or positive light, but more often than not, figures taken out of context and presented to make the case could be easily argued. 

For instance, CBAI quickly doubled soon after my initial coverage of the stock, and I mentioned to readers that I sold into the spike while holding onto a handful of 'just in case shares.'  In the case of the "Ten for 2010" article that I believe the reader is referring to, the stock nearly doubled just weeks after I wrote that article before dropping back down.  Because stocks such as that one are so volatile, I always advise to take profits when you can. 

BIEL more than tripled and nearly quadrupled shortly after I started covering that stock.  Granted, it's fallen quite a bit since then, but if you're going to argue one side of the story, you need to at least present the other.  We're in a re-load phase right now and I think that in the long run, BIEL is going to realize investors a lot of money, especially those who have been loading the boat at a penny. 

'Nuff said on BIEL.

CSUH - This stock traded for under three cents when I called it a 'load the boat' stock.  The stock rocketed thousands of percentage points after that time.  Do I like it again as a 'load the boat' stock?  Yes.  have I stated that I've been all for adding a few shares here or there on the way down?  Yes.  That's the life of a speculative player - find your buy price, your sell price and your load the boat price and stick to a strategy.  This stock in particular made for some big Dom Perignon nights, so it's highly comical when the haters keep brining it up. 

If you want stability, invest in MSFT.  If you want big gains, go speculative.  There's risk there, as this reader mentioned - speculative stocks rise and drop with great volatility.  The speculative investor has to be willing to sell into spikes and re-load on the dips.  It's that simple.

Additionally, each of these stocks mentioned by the anonymous poster is still developing their respective plans for growth; by reading this post one would believe that the stories are over - dead in the water, which is certainly not the case for either one.  Such is the viewpoint of the closed minded anonymous message board poster.

Always appreciate the input, thanks for writing.








CVM: Multikine Phase III Approved in India, and a CEO Webcast



Cel-Sci Corp announced on Wednesday that seven hospital Institutional Review Boards (“IRB”) in India will begin enrollment for the pending world wide Phase III Multikine trial.  India looks to be a big player in the trial, with Cel-Sci expecting fifteen clinical centers out of an expected forty-eight clinical centers world-wide to be located in that country.  Slowly, but surely, the Phase III approvals are rolling in, but as I've stated before - it's news of the trial commencement that investors and followers of Multikine's progression are waiting for.  The site approvals are nice, but the slow tease is quickly becoming mundane.  Let us know when the first patient has received the treatment and then we'll pop the Dom Perignon.

In the meantime, CEO Geert Kersten presented at a recent Precision IR virtual conference.  Nothing very noteworthy came from this presentation, but Geert did reiterate quite a few key points regarding Multikine.  He emphasized the fact that Multikine is intended to be a first line standard of care, different from any other cancer immunotherapy in what he called the "first generation" of immunotherapies. 

Of note, Geert lumped Dendreon's Provenge in with that first generation.

The difference between the first generation immunotherapies and Multikine - which he considered to be a "second generation" treatment - is that Multikine is an "off the shelf product."  No samples are needed from the patient, as is the case with Provenge. 

Multikine will also be administered before the patient receives chemotherapy or radiation treatments.  That goes in line with what I consider to be common sense - an immunotherapeutic treatment will work better when the treatment has an immune system that is still in tact to work with.  Chemo and radiation kill the immune system, so I've never quite understood why the new breed of cancer vaccines were only being tested in patients who have already received those treatments.  If successful, Multikine could set the standard.

Mr. Kersten also mentioned the manufacturing facility located near Baltimore, Maryland, which currently has the capicity to produce 20,000 doses in a year.  Within a year and a half, that number could triple.

This is all information that we've all heard before, but I think it's good to be reminded of the true potential of Multikine if this product makes it to market.  Ignore the investing standpoint for a moment and consider the impact that Multikine - like Provenge - could have on the way that the human race treats cancer.  For decades cancer patients have had to fight not only the cancer that succumbs their bodies, but also the very treatments that heal them. 

Treatments such as Provenge and Multikine could be game changers, and could mark a shift in cancer treatment for the ages.

That said, it's yet to be seen if Multikine works as advertised, hence the Phase III trial.

Slowly the site approvals are being announced, and it's only a matter of time before this trial starts.  It should be fun, not just from an investing standpoint, but for the very fact that Multikine could make history.

The risk in a CVM investment is well worth the rewards, in my opinion, although it's worth noting that aside from Provenge, cancer immunotherapies have been highly unsuccessful in coming to market.

Disclosure:  Long CVM.






Wednesday, October 20, 2010

MHAN: Could 2011 Be The Year?

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About a week ago I mentioned that Mannhattan Pharmaceuticals would participate in the Precision IR biotech virtual conference, and sure enough the presentation took place, although nothing significant came from the presentation - aside from the fact that we actually now have confirmation that someone in the company has a heartbeat.  The proof of a heartbeat came from Dr. Malcolm Morville, President and CEO of Ariston Pharmaceuticals, with whom Manhattan merged earlier this year.

Dr. Morville's presentation, while quite monotone and painful to listen to, gave speculative investors a look at recent developments and future expectations of the company, but did not answer the question as to what is taking so long to advance the pipeline.  It seems like forever that we've been listening to the potential that the insecticide-free head lice treatment Hedrin would have in the US and Canadian markets, but the story has remained the same for the better part of a year - still in discussions with the FDA to commence a Phase III trial. 

According to Morville, the FDA had some non-clinical and manufacturing concerns with the Hedrin plan that needed to be addressed before Manhattan could move forward with the trial.  Those concerns are being addressed, so we could only assume that this trial might take place by early next year - if it ever takes place.  Since Manhattan and joint venture partner Nordic are engaged in a dispute about ownership of the JV and share count, the Hedrin plan could disintegrate before it ever gets off the ground.  Should these entities get their acts together and advance Hedrin to market, then significant revenue could be generated for both the JV and for shareholders. 

On that potential alone, I still think that MHAN is a great risk/reward pick while trading for mere pennies.

The second Manhattan/Ariston product that shouldn't be too far away from market is AST-726, a nasally delivered form of hydroxocobalamin for the treatment of Vitamin B12 deficiency.  I learned way more than I cared to about this product during the webcast - and almost fell asleep a few times - but according to the good Doctor, AST-726 is a superior alternative to the current treatments already on market to treat this condition.  A Phase III trial is planned for early in 2011 and - if successful - the path to commercial launch should be fairly quick.
Also on the cooker is AST-915, a treatment of essential tremor, and a topical GEL product which Manhattan plans to commercialize as an OTC treatment for mild psoriasis.

The webcast was encouraging enough to justify the current two cent buy, in my opinion, with the risk being minimal and the potential rewards being very significant.  It's been a while sitting on this one since the last run to twelve cents, but if any of these trials get off the ground, then we could see another run.

These guys are a little too shady for my liking to not sell into any spikes, but you can't argue with risk/reward.

I even added a couple for two cents.

Disclosure:  Long MHAN.




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