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Neostem, Inc. Message Board

  • bob_flemings bob_flemings Oct 15, 2013 8:58 AM Flag

    Nichols nailed it with offering

    So, with this offering, NeoStem raised $40.25 million in gross proceeds after the over allotment was fulfilled. Therefore, if we take the $40.25 million raised, combine it with the near $20 million in cash that NeoStem has on its balance sheet, then NeoStem has roughly $60 million (counting grants). In the last year, NeoStem has posted a net loss of $39 million - during the costly enrollment period - thus NeoStem now has more than a year of operating cash, eliminating the overhang of future dilution.

    What's so good about the cushion, or wiggle room, provided with this offering is we will know so much more about NeoStem one year from today. NeoStem is expected to complete enrollment for its Phase 2 CD34+ cell therapy product, AMR-001, by year's end. This therapy repairs damaged heart muscles following an acute myocardial infarction (heart attack). The company's CEO, Dr. Robin Smith, has said that data following complete enrollment will be six-eight months later. Thus, we will know data before any future financing is needed.

    This fact is incredible for shareholders, as it will allow the anticipation following complete enrollment to push shares higher. So far, we have seen no negative data from AMR-001. Last year the company found that not one patient had a deterioration of heart muscle function when treated with 10 million cells, compared to 30-40% when treated with fewer cells. Moreover, AMR-001 mimics Baxter's (BAX) Phase 3 cell therapy, a product that also treats a cardiovascular condition, reaching endpoints never before met. These facts, along with other publications and research, support a positive outcome for NeoStem's study. With that said, conservative estimates for AMR-001 are for peak sales to exceed $1 billion annually with this one indication alone. Seeing as how many biotech companies are trading at one times peak sales potential after solidifying data, NeoStem could be transformed to a $1 billion company

    Sentiment: Strong Buy

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