Analysis - BPH - Biopharmica

Analysis - BPH - Biopharmica

FREE SHARES

But wait ... let's look at this company first

Price($) 0.08
NTA ($) 0.07
P/NTA 1.26
Team 1.9
BurnPeriod 6.46
ProductPipe 8
ForeignMarket 0.5
Cash:Debt 3.62

The analysis shows great strength in some areas yet poor in others.

Debt: Unlike many early stage biotechs, BPH already has debt - while others typically have zero debt. Yet a cash:debt ratio of 3.62 should not be too risky. Projecting the previous cash burn rate forward, BPH can survive another 6.5 quarters or over 1.5 years if the burn rate remains the same. Not shown here is the fact that the operational expense for BPH is between $200k to $300k recently. This can be viewed positively as slow cash burn or viewed negatively as a lack of activity for the company.

Market: Though not many of its products are on the market, it has not shown any indication of targeting foreign markets on any scale. It does have collaboration with GE Healthcare and patents targeting foreign markets.

People: It has a small team with an even smaller number of scientifically qualified people at management level. It is not certain to what extent can BPH rely on its partners or collaborators on scientific knowledge including Universities.

Products: The product pipeline is one of the strong factors of BPH. Its lung disease chip is in the market while the Brain Monitor is in the process of gaining market approval. A tumor suppresor gene is also being developed but in the pre-clinical stage.

Price: Looking at the P/NTA ratio shows that it is one of the most undervalued startup biotechs. With a P/NTA value of 1.26 combined with 6 quarters of survival left, BPH looks very attractive despite other shortcomings.

Now for the FREE SHARES ....
as of this evening of 13 June 2007, after the close of the ASX, BPH announced that its subsidiary responsible for the Brain Monitor will be spun off. The terms is that each BPH holder on July 15 2007, will receive the same number of shares for free. The shares of the new company will be $0.20. BPH will likely shoot up at the open of tomorrow's trading.

Recommendation: Without Spinoff and Free Shares -> BUY up to 12c. With the knowledge of free shares -> Buy up to 22c.

Disclaimer: I do not own BPH shares yet - but likely to order.