AndrewGreenBull's Blog : A Hot Stock to Watch: ANPI

HSKA already has a 100% gain since last December after my introduction, but those real value investors will realize that there is still more room for it to grow, because the current price can not reflect the real vale of HSKA yet. For more details, please find my last post No.1 Pick in 2010 in my blog.

ANPI has a high possibility to be the next HSKA.
Angiotech Pharmaceuticals, Inc. (ANPI) is a global specialty pharmaceutical and medical device company that discovers, develops, and markets innovative technologies and medical products primarily for local diseases or for complications associated with medical device implants, surgical interventions and acute injury.

APPROVED PRODUCTS
•Drug-Eluting coronary stents - Partnered with Boston Scientific Corporation
•ePTFE synthetic vascular grafts - Acquired from Edwards Lifesciences in 2005
•VITAGEL surgical hemostat - Partnered with Orthovita
•CoSeal surgical sealant - Partnered with Baxter
•Medical Device Products - Angiotech has over 5,000 SKUs (or specific products) in its inventory of medical devices, including various biopsy devices, guidewires, hemostasis pads, specialty surgical knives, sutures, microsutures.

CLINICAL TRIALS
•Bio-Seal™ Biopsy Tract Plug
•Option™ Vena Cava Filter
•5-FU-Eluting Central Venous Catheter
•MultiStem® Stem Cell Therapy

Last October ANPI received a reply from the FDA regarding its 510(k) submission for Bio-Seal, stating that Bio-Seal is a class III device that requires Pre-Market Approval (PMA) for FDA marketing clearance .Bio-Seal is a novel technology designed to prevent air leaks in patients having lung biopsies by plugging the biopsy track with an expanding hydrogel plug.
Although the market is very positive on the potential of Bio-Seal, it takes time for PMA application. As a result, the stock price of ANPI was suffered from the gradual departure of the short-term speculators. The current stock price $0.97 has down about 67% from 52 weeks high $2.94.

This price is obviously oversold, but the market is waiting for a catalyst to re-attract investors’ attention and re-evaluate the real value of ANPI. Now this catalyst is only one day ahead.

Let’s go over the fundamentals of ANPI first:

*There are 51 million dollars cash and equivalents, more than 120 millions total current assets on balance sheet and the market capital of ANPI is only 82 million dollars!

*For the first nine month of 2009, ANPI recorded $142.0 million in direct sales and $74.1 million in royalties and license fees; for the full year 2009, ANPI expected 268 million dollars in revenue with a 50% gross margin.

Several catalysts which I believe that will lift ANPI’s stock price in both short-run and long-rum:

*New product TAXUS Element (coronary stents) launched by partner Boston Scientific Corporation in selected market worldwide in last May, ZILVER PTX stent (Drug-Eluting Stent) launched by partner Cook Medical in Europe last August, another new product 5-FU-Eluting Central Venous Catheter is expecting to commercialize during the first half of this year.

These new products will not only enrich the ANPI product pipeline, but also will bring new revenue streams to the company.

*ANPI and partner Athersys announced completion of patient enrollment for its phase I clinical trial of MultiStem(R), its allogeneic stem cell therapy product last month. Top line results of the trial are expected to be announced midyear. This will be another incentive for ANPI’s stock price.

*ANPI is now working with its partner to discuss the next step of its lead product candidate Bio-Seal, and news from grapevine said that ANPI is seeking appeals for FDA’s decision .Once succeeds, we expect that ANPI will at least double its current price. Even ANPI needs to file PMA, in the worst case, I believe that Bio-Seal will eventually get a nod from FDA according to the previously positive data. This makes ANPI a good choice for those real value investors.

*ANPI will report 4th quarter and the year 2009 earning on March 4, and it is expected to swing from last year’s loss to a profit. The whole market has been waiting a long time for this moment. We may see a potential 50% jump in share price if ANPI simply reports a earning in line with estimates.

Will ANPI be the next HSKA? The riddle will be answered soon.

*Disclaimer: The author of this post is not a licensed analyst and the purpose of it is for information sharing and discussion only, not recommendation for any stock buying and selling activity. Please do your own decent research before making any trading decision