1) No Revenue. MelaFind was approved in November 2011 and it's now June 2013 and despite all the spin by Management, they have amassed less than $500k of revenue. That is PATHETIC.
2) Lost Leadership - MELA had a two-year head start against Verisante's Aura system being developed up in Canada and blew their first-to-market lead, as Aura generated more revenue in Canada and Europe in the past quarter than MELA has generated in any quarter to date. Again PATHETIC
3) No Salesforce: MELA has had very little salesforce as they were ill prepared to go it alone. Given the training involved, it is just taking way too long to sign up doctors
4) No Incentive for Dermatologists - Dermatologists make too much money doing biopsies...it is a substantial amount of any practice. They have no incentive to use MelaFind. They would rather biopsy and get paid a lot more. The only way they would want to switch this behavior is if they started losing patients to other competing dermatologists who used MelaFind. That is not happening anytime soon.
5) Capital - MelaFind is going through $6-7 million of negative free cash flow per quarter...as of March 30th, with $21 million of cash, they have 3 quarters of cash left. They will continue to need to raise significant amounts of money given there minuscule quarterly revenue ramp.
6) Management - completely unprepared for launching MelaFind on their own...no salesforce, no financing, no plan, and incredibly slow to market. Generating $150k of revenue per quarter is not going to cut it. No matter how much insider buying is going on, this stock is not going up until MELA shows that it can generate revenue. And, right now, it's got a competitor up North who has a nicer system tha can do different types of procedures. MELA needs a next generation, less cumbersome design rolled out ASAP, and it needs massive sales which requires more marketing and more distribution.
Shareholders deserve better, but right now, it is bleak!