I almost never buy stocks in something I fundamentally don't understand. Bio-Pharma is exactly what I am talking about with the above statement and I avoid those stocks like the plague.However, all rules are eventually meant to be broken. I nibbled at some Aspen BioPharma today (APPY). This speculative pharma play comes highly rated by my brother-in-law, who is a major broker at a large investment bank. A senior analyst that works for his company that he really respects believes that APPY may have a blockbuster test that is soon to be approved by the FDA.
APPY is this analyst's #1 recommendation for 2008 (the analyst is an M.D.) and I am attracted by the fact that they just performed a secondary placement of $18 million of new common stock at $7.28, basically putting a floor on the stock price at around $7.50.
Hedge funds are picking up this stock and it is starting to get noticed. They have a number of products focused on veterinary medicine, but they may have a major home run with an appendicitis blood test (a first of its kind) that will help doctors screen for this condition. The company is looking for final approval from the FDA and this test could become a staple requirement for every doctor that encounter patients with appendicitis-like symptoms.
This is speculative play and I am looking for an exit point around $12.00.
2 comments:
Agree that this test would be speculative.
If you are 100% correct every time a surgeon does an appendectomy, then he is not doing enough since there must be some that are defying diagnosis.
If one has to act on being sued on an act of omission or commission in this clinical setting, if I were a surgeon, I would prefer to be guilty of the act of commission.
HOTWINGS78
Thanks for the comment Hotwings. Lets hope that the FDA approves this thing!
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