4 picks for the biotech boom in 2011

I believe some of our listed biotech companies is finally be showing the inevitable signs that this sector is indeed entering the next boom era

If you also have an interest in the Biotechnology sector please share your favorite(s) choices with a brief summary, ie shares outstanding / MC / & product/technology update.

Welcome to the golden era of Biotechnology

The last 6 Month share price movements

MSB - + 246.64%
CBZ - + 241.18%
CZD - + 212.00%
PRR - + 188.46%
BOD - + 126.92%
QRX - + 125.00%
NRT - + 116.00%
PAB - + 105.13%

SPL - + 101.52%
PBT - + 88.00%
CDY - + 57.89%
MVP - + 55.17%
PNO - + 50.00%
VLA - + 50.00%
PYC - + 48.00%
PAA - + 47.06%

BIT - + 42.86%
ADO - + 42.00%
AVH - + 35.00%
TIS - + 35.00%
POH - + 31.82%
ACL - + 30.00%
OBJ - + 30.00%
PGL - + 29.03%

BDM - + 28.57%
RHT - + 22.22%
ACR - + 21.07%
AVX - + 19.05%
PXS - + 08.93%
ANP - - 07.14%
SIP - - 19.57%
EMS - - 45.00%
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4 picks in my portfolio

OBJ Ltd

MC - $30,012,095
Issue: 1,154,311,333 (+ approx 100mil Options - OBJOA)

OBJ is the leading developer of magnetic , magnetic micro-array and powerless drug delivery technologies and works with partners in the design and development of drug patches, applicators, brushes and devices for the pharmaceutical, healthcare, cosmetic and homecare product sectors

OBJ remains my first choice for the big multi-bagger in 2011 and imo it's clearly evident in their most recent announcements that something quite explosive is in the air.

Surrounded by secrecy and strict confidentiality agreements OBJ have just completed a very successful consumer acceptance testing program with a major FMCG company for a multi-billion dollar product currently sold world-wide. OBJ's most recent announcement confirmed that this development program has now been moved to being reviewed by FMCG's international marketing department.

When this imminent license agreement is announced the market will quickly calculate what a multi-billion dollar product @ 5% royalties will do to a 2.6c share price. I have a 9c target on this license agreement alone and I remain very confident that we'll see more than one agreement this year.

In October 2010, the Company reported the commencement of discussions regarding the next steps in a development program for an undisclosed but important area in Consumer Healthcare products.

These discussions were in response to a series of earlier statistically significant evaluations by GSK's UK based Consumer Healthcare Division.

The Company reported that the relationship between the two Companies is progressing well with plans for first-in-man studies being finalised.

Further details will be provided once negotiations regarding the study programs, protocols and agreements have
been concluded.

OBJ announced in August 2010 that other programs continue with a number of major pharmaceutical companies across this market sector as well as working closely with two of the world's foremost cosmetic brands, five of the world's largest companies across a variety of applications in consumer healthcare and discussions were also underway with leading international groups within the industrial sector to further explore suitable applications with their FIM Technology.
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BioMD Ltd

MC - $7,819,560
Issue: 132,534,911

The company operates in two segments: the development and commercialization of medical therapy products, and the development of bioimplants, and also recently announced a (reverse) T/O of Andrew (Twiggy) Forresters, unlisted Allied Medical Ltd - A spin-off from Fortescue Metals Group. The Final bidders statement due before May 5.

One can only assume that this is Mr FMG's quick way of getting his spin-off biotech firm listed however subject to the imminent approval of s/holders on both sides this appears to be a win/win for both companies imo.

Mr Forrester and his billionaire BRW rich list mates are not too familiar with failure either so imo this very tightly held stock will have legs on arrival of good announcements. Click here for The Australian article - Mining Magnate invests in Biotech.

News expected for BioMD soon:

* Final bidders stmt for Allied Medical (reverse) Take-over

* Australian TGA, and European CE regulatory applications filed ~ Q1,2011

* FDA application to follow TGA/CE ~ Q2, 2011

* Global Heart Valve Project Completed ~ Q2,2011

* Commercial product Cardiocel ready for AUST & ASIAN markets ~ Q2,2011

* Cardiocel patch distribution agreement for Europe ~ Q3.2011

R&D continuing for emerging growth opportunities utilizing the ADAPT biomaterial mesh for the growth of stem cells, chrondocytes (cartilage) and keratinocytes (skin)*

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Prima Biomed Ltd - (PRR):

MC - $300,876,387
Issue: 802,337,032 (+ approx 110m options - PRRO)

Prima BioMed is focused on technologies in the new exciting fields of cancer immunotherapy and immunology.
Prima is developing Cvac as the world's first vaccine therapy for ovarian cancer.

"I have sourced the following information from New York's ProActive Capital Resources who have summed it all up nicely imo:"

* Depth and experience in management for drug approval --- as well as an scientific advisory team including Prof Ian Frazer, co-inventor of Merck/CSLs ($MRK) cervical cancer vaccine, Gardasil.

* Targeted cancer therapies are a hotbed of licensing and M&A activity (See Healthcare Megatrends --- Targeted Cancer Drugs) so the future progress of Prima BioMedical is likely to attract a lot of Big Pharma scrutiny and interest.

* Only 20-30% of patients with cervical cancer with late diagnosis survive for 5 years, so a treatment so that a safe and effective treatment would seem to have a tactical advantage in the FDA approval process. The global market size for ovarian cancer approximates $3.6B.

* Cvac has been granted "orphan status" by the FDA, which allows it seven years of exclusivity from commercial launch. It also receives priority review by the FDA, which waives its fees for orphan drugs.

* CVac is based on the same cellular technology as Provenge from Dendreon Corp. ($DNDN). The recent approval of Provenge for asymptomatic or minimally symptomatic metastatic hormone-refractory prostate cancer would seem to validate the underlying concept. Like Provenge, CVac utilizes activates dendritic cells to stimulate a cellular immune response, rather than just an antibody response.

* Prima has completed Phase IIa clinical trials with CVac in Australia in 28 patients with advanced disease, and the company has filed with the FDA for an "investigational new drug" application to start a Phase IIB clinical trial in the U.S

* CVac has broad potential because it is directed toward the mucin-1 antigen and thus may be effective against other cancers that overexpress mucin-1 such such as ovarian, breast, lung, colon and pancreatic cancer.

* Phase IIa trial results showed that 21% of patients responded to therapy in patients with incurable ovarian cancer (life expectancy at least 6 months). This is not dissimilar to the response times of some of the most successful cancer therapies when they were at this stage of development incuding Avastin (Roche $ROG.VX), Aromasin (Pfizer $PFE), Iressa (AstraZeneca $AZN), and Provenge (Dendreon $DNDN).

* Prima is hedging its bets with respect to the FDA approval process by pursuing fast-track commercialization in other jurisdictions with a registration study planned for Europe, with patient recruitment commencing by Q3 2011.

* Prima is well funded; $40M committed for current work.

They are currently awaiting approval for NASDAQ listing which will attract broad institutional investor interest in the stock.
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Prana Technologies - (PBT):

MC - $63,283,668
Issue: 269,292,203

Prana Biotechnology Ltd. (PBT) is an Australian biotechnology company, which is at an early stage in the development of pharmaceutical products designed to treat the underlying causes of degeneration of the brain and the eye as the aging process progresses Potential applications for PBT's MPAC (Metal-Protein Attenuating Compound) technology include Alzheimer's, Parkinson's and Huntington's diseases and brain cancer.

Harvard Medical School:
"PBT2 has the best chance of all currently available potential competitors to be the first effective disease modifying treatment for Alzheimers Disease.

Director - Alzheimer Disease Research Center - UCLA:
"Very few drugs in clinical development have been able to bring these benefits to Alzheimers Disease patients. I am very encouraged by these findings."

Professor Colin Masters - Mental Health Research Institute and internationally acknowledged leader in Alzheimers Disease research:
"These results are very exciting given that they were achieved in mild Alzheimers Disease sufferers in a relatively short period of time. Based on clinical trial outcomes to date, Pranas therapeutic strategy stands up as one of the safest and most effective means of treating the disease.

"Pranas PBT2 research has won strong praise from leading scientists including Sir Gustav Nossal, a world renowned research biologist and former winner of the Albert Einstein World Award for Science."

Gustav Nossal's world-renowned work helped build the foundations of modern immunology - an exacting field of science that he helped define for more than 30 years.

Up until 1989 he was President of the International Union of Immunological Societies. He has been in the front lines in the global battle against disease through his direct involvement with the World Health Organisation since 1967.

He is President of the Australian Academy of Science, Chairman of the Strategic Advisory Council for the Bill and Melinda Gates Children's Vaccine Program, USA & Deputy Chairman of the Advisory Council of The Global Foundation

It was noted in Prana's Nov Ann that Mr Nossal or should I say Sir Gustav described Pranas research as "one of the iconic discoveries in Australian medical and health research".

With 80% of only 242,037,203 shares held by top 20 s/holders and small daily volumes it would suggest imo that the remaining 48mil are also tightly held.
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What's driving this Biotechnology Boom?

The Golden Age of Biotech

Randal J. Kirk, Chairman and CEO of Third Security, LLC, believes the biotech industry is on the threshold of a golden era, filled with valuable discoveries that will forever revolutionize the sector's foundation.

The industry finds itself in a similar position to the semiconductor and software industries of the yearly 1980s: on the verge of identifying the technologies and motifs that will be the bases of the tremendous growth to come.

Among the life science sectors, Kirk says, the most promising include molecular biology, cellular biology and genetics, as well as the intersection of the three. This space is accruing intellectual capital at such a fast rate that, by his estimation, the quantum of what is known currently doubles every two to three years.

In its first thirty years, the biotech industry focused on genes, their modification, and the processing of their output. Today, the focus is shifting to the non-transcribed portions of DNA - researchers now understand that regulatory domains act as logical controllers, which is precisely the role DNA plays in nature.

Despite some short-term challenges, the next ten years will be an exciting time with a series of major advancements poised to unfold.

Biotech is entering its golden era, where tremendous growth in technological applications will create a bounty of meaningful clinical tools to address the majority of known cancers and degenerative diseases. Source - Life Science Magazine

Emerging Markets

"Emerging markets provide a critical growth opportunity and companies will need to develop strategies that ensure success in fast-growing countries. Consider that in both Brazil and China, healthcare expenditures have more than doubled in the last 5 years. In addition, 75 percent of the population is now covered by public health systems, and the goal in China is to have 90 percent covered by 2011 - a total of almost 1.2 billion people in China alone! In addition, while China currently represents the 6th largest pharmaceutical market, it is expected to become the 3rd largest market by 2011 according to IMS Health. Emerging markets now contribute 36% of global patient enrollment compared to 20% in 2001 according to Ernst & Young.

Patent Expirations on the Horizon

"S&P Equity Research estimate that by 2013, big pharma drug makers will face patent expiration issues on drugs that currently generate more than $100 billion in sales. Among the high-profile names:

Eli Lilly & Co. (NYSE: LLY) will lose its anti-psychotic drug Zyprexa next year. Bristol-Myers Squibb Co. (NYSE: BMY) lost its heart attack/stroke treatment drug Plavix in 2010. Pfizer Inc. (NYSE: PFE) lost its huge anti-cholesterol drug, Lipitor in 2010.

Wyeth's two biggest selling drugs, Effexor for depression and Protonix for heartburn, will lose patent protection in 2010 and 2011.

Other companies with patents set to run out on major drugs by 2010 include Ratiopharm, Sandoz, Merck KgaA, Actavis, Apotex, Barr, GSK and Watson.

Companies With the Biggest Cash Reserves for M&A:

Novartis $15 billion
Roche $13.5 billion
Johnson & Johnson $13 billion
Merck & Co. $10 billion
GlaxoSmithKline $9.5 billion

The era of personalized medicine is set to revolutionize the healthcare industry

"With the expansion of our knowledge of genetics and molecular biology, personalized approach to medical care is increasingly becoming important. While still in the early stages, personalized medicine is steadily emerging as the new healthcare paradigm. In fact, this paradigm not only promises the improvement of an individual's treatment outcome and reduces healthcare expenditure; but is set to transform the biopharmaceutical and molecular diagnostics markets in the coming years." Click here

Click here to listen to representatives of International Mergers & Acquisitions firm Baker & Mckenzie's Ben Mclaughlin & Laurent Barabara discussion with brr on Life Sciences Global Trends - March, 2011

Click here to read this article "Biotechnology-boom from a Global perspective"

The Headings say it all imo!

Click here - "Australia lags behind Asia's bio-boom"

Click here - "How to profit from the next Biotech-boom"

Investing in a bio spec stock comes with an intrinsic risk and always requires thorough research. The most important parameter while investing in a bio spec should be to ensure that you have understood the fundamentals of the company.