b. andrews in usa

I believe he is in the US finalising further distribution deals to be in place so when FDA approval occurs they are ready to roll out the product immediately. I am sure HGR already has several deals of this nature in place but now with Mexico deal and iminent FDA approval it gives them new leverage with a whole range of big US workplaces and law enforcement agencies. As soon as FDA approval is given expect a raft of contracts with major US companies relating to provision of devices for workplace drug testing. Having a 510K will provide substantial multiples as it is a barrier for people to switch to saliva as employers are always seeking to mitigate their risk from litigating employees. The profit margins as a result of this barrier to entry would be very good for the US. Once the approval is given, all workplace saliva testing by major US companies will by done using oraline. They won't risk carrying out saliva tests using devices that are not FDA approved. I really don't think the market understands the significance of FDA approval with relation to workplace saliva tests.

With regard to over the counter sales, HGR already have deals in place with Rite Aide, Walgreens and CVS which between them sell 3 million tests per year. Once FDA approval is given, the otc sales in these stores alone would deliver close to $10 mill USD.

If HGR gets this FDA approval within next few months, and it is highly likely now because of FDA's permission to sell to Mexico, I really dont think the market understands the potential for saliva test deals to be done with the big US companies. Again I belive Brian has already stitched up several deals in advance, and the reality of the FDA approval will mean instant revenue streams in the tens of millions of dollars in the short term- 6 -12 months and hundreds of millions in the mid to long term - 2-3 years


ANY announcement of a positive nature within the next few months (and I expect quite a few) will send this SP soaring. The reasons are as follows-

1. tightly held by top 20 shareholders who own 50% of company, low number of shares- around 380 million,

2. market potential is huge,

3. they are at the right place at the right time to take advantage of the huge market,

4. they have good people at the helm, major shareholder is a gun businessman, he has re-bought in the last few weeks as has the CFO Andrew Paice ($40k of his own money) - do not underestimate the significance of an accountant who works for the company putting in $40 k of his hard earned money backing this company. He is not a high roller just a working bloke and a smart one at that- for him to recently risk $40k of his own money in this puppy says a lot for what might be in store for this business)

5. Drugs are a huge problem in society worldwide,

6 Finally they HAVE the technology already, it is far superior to any other saliva test device on the market and it is not a work in progress but already available and tested.

This stock will be close to 50 cents by the end of this year, if not more, for all the above reasons. Again, I have held, researced and followed this stock for 18 months, and believe the next 6 months will be incredible for this company

Remember I told you this on 4th September 2007