Sarasota, FL 3/28/2008 7:33:37 PM
Blood is Thicker Than Water
Pennycents Magazine Reports on HemoBioTech Inc (HMBT: OTCBB)
Pennycents Magazine, the market’s most valuable research tool covering micro-cap, penny stocks and otcbb equities, issued the following daily column by Priya Nigam.
There is a terrific shortage of blood not only in the US, but across the globe. While the demand for blood rises, low donation rates are frequently resulting in surgeries being delayed. The blood shortage scenario is aggravated by the lack of the right blood type and with blood contamination due to the presence of diseases like HIV. Billions of dollars have already been spent to develop artificial blood, or blood substitutes.
HemoBioTech Inc (OTCBB: HMBT) is a development stage biopharmaceutical company that is developing an artificial blood product called HemoTech™. It has obtained an exclusive worldwide license from Texas Tech University Health Science Center (TTUHSC), which covers all intellectual property (IP) associated with the human blood substitute technology. HemoTech has undergone a very small clinical study in Zaire, Africa. Clinical testing here indicated non-toxicity in humans and additional studies are currently being carried out in the US. If everything proceeds according to plan, HemoBioTech expects to obtain FDA approval of HemoTech by mid-2011.
Clinical testing has also been initiated in India. “HemoBioTech considers India a key component of our global strategy to commercialize HemoTech,” said Arthur P. Bollon, Chairman and CEO of HemoBioTech, in a press release in June. “With a population of 1.1 billion people, a significant middle class, and a good infrastructure for clinical studies, HemoBioTech considers India as a potential standalone market for HemoTech.” The company has appointed Paragon Biomedical Inc to carry out trials in India and the US. HemoBioTech is now seeking partners to produce HemoTech. If it fails to do so, it would have to create its own production facility that adheres to the FDA’s standards for product testing, at an estimated cost of $100 million.
HemoBioTech’s shares have plunged by nearly 40% from their 52-week high of $2.30. Shares traded above $2 over the first three months of 2007. Since then, they have declined steadily to reach the current level of close to $1.10. The initial results demonstrated by HemoTech are encouraging and the product faces a global market opportunity of more than $25 billion annually, of which the domestic market alone represents $7-$14 billion. The company estimates the Indian market at $2 billion annually. HemoTech has the potential of not only being the first viable blood substitute, but would also overcome the problem of blood contamination and blood typing (would be compatible with all blood types). While the potential is immense, the journey to an FDA approval is a long one, dotted with huge costs.
The writer does not own shares in the above stocks.
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