CAPS Rating: No stars


Player Avatar zzlangerhans (99.86) Submitted: 2/2/2010 12:06:31 PM : Outperform Start Price: $3.80 PBTH.DL Score: +7.64

OK, let's see if this run has any gas left in it. When considering green thumbing an OB like Prolor, I feel like the main task is identifying the problem with the stock. The underlying science seems justified. The company is developing protein therapeutics that have been modified with the naturally-occurring CTP amino acid sequence to extend in vivo half-life. They are targeting large markets for growth hormone, interferon, erythropoietin and other compounds that currently require frequent injections. New formulations that are equally effective but dramatically reduce the frequency of injections would likely replace the current standard of care. The recent upward run was due to EMEA approval of Merck's FSH-CTP, which independently validated Prolor's reason for existence. The company recently completed their first phase I safety trial, but has not yet generated any efficacy data from clinical trials.

What I don't particularly like is that the company went public earlier this year through a shell merger with a previously busted company that I can't find any info about. Philip Frost seems to be the main financial backer and I'm not a fan of the opacity and gyrations of the other stocks he has been involved with. I can't determine from the company's financial statements what their cash position is, but it seems to be low.

Ultimately this is a CAPS-only bet that the financial condition of the company is sufficiently stable to allow some further inflation in share price before the inevitable first crash occurs.

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