A Rare, De-Risked Break-Out Stock For Healthcare Investors

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By M.E.Garza   
Wednesday, 25 April 2012 04:30
Not only are shares of this healthcare sector stock just starting to break-out technically, fundamental indicators are also pointing to higher prices ahead.

Telling the story of Neptune Technologies and Bioresources (NASDAQ: NEPT) can be a complicated and drawn out process. When one first discovers the company, one has to peel back the layers to find that this is truly a rare healthcare play and that each layer is valuable on its own for multiple reasons.

First, Neptune is a well-established leader involved in the development and commercialization of Neptune Krill Oil (NKO®)-- a marine omega-3 phospholipid that exhibits high levels of excellence in omega-3 standards and that may be set to surprise Wall Street with strong revenues generated in part from their rapidly expanding manufacturing capacities and partnerships with major multi-national food and nutraceutical leaders.

NEPT: Investors Presentation

Krill Oil Based Drug Candidate Could Unseat Glaxo's Blockbuster Lovaza

Second, Neptune has considerable ownership stakes in two intriguing biotech spin-offs seeking to develop and exploit pharmaceutical applications for those Krill-based bioactive ingredients in huge multi-billion dollar markets, each with vast unmet needs. Neptune shareholders have their own stake in the subsidiaries,  Acasti Pharma (TSX:APO) and NeuroBioPharm-- each of which aim to demonstrate the therapeutic benefits for human conditions which include: Hyperlipidemia/ Cholesterol Management, Premenstrual Syndrome, Skin Cancer, Attention Deficit and Hyperactivity Disorder (ADHD), and more.

Not only is the Neptune proposition strong enough to consider holding as a core position in one's investment portfolio, but with several pending news and milestone developments, the company is also an attractive play for speculators who are seeking a company with near-term payoffs.

As the story of Neptune begins to spread and take hold, our sense is that you will see an increase in ownership from institutional investors and even more analyst coverage for the company in the days ahead.

Wael Massrieh, VP of Scientific Affairs at Neptune Technologies and Bioresources (NASDAQ: NEPT), discussed with us the reasons why his company is one of the most diverse and nearly de-risked investments in the healthcare sector.

"Going the pharmaceutical route has always been in the mission of Neptune," explains Massrieh. "When Neptune was created that was the long-term goal. We obviously didn’t think that it would be possible at that time to do it right away. So Neptune has created the dietary supplement business of selling Neptune Krill Oil-- as a steppingstone to the big, the homerun, as I like to call it, for selling the pharmaceutical grade of the krill oil.

"I want to just reemphasize that point you made is that the situation has been de-risked in several ways. The fact that the raw material that Neptune sells as Neptune Krill Oil already has a clinical study showing that there’s an improvement in the triglycerides, the LDL and the HDL. But even for the pharmaceutical grade, there are some preclinical studies that we’ve done going head to head with Lovaza where the CaPre, the pharmaceutical product that’s been going through Phase I, Phase III, has actually showed superiority over Lovaza in reducing triglyceride. So it is something that I always like to refer to as a de-risked for this situation. It’s not like your typical biotech that is hoping to demonstrate an effect in a phase II or phase III, we already have shown that in other models."

"I actually recently added a slide at the end of my presentation and I basically drew three circles. In one of the circles, I drew and I included in there the statin market with a $35B value. I drew another circle that had the Niaspan, which is the drug that Abbott sells and increases HDL and that’s $2B and then on the top I had Amarin and Lovaza on there that reduce triglycerides. Then, I have Neptune in there that overlaps all three circles and basically, I put a question mark on there and I leave it to the investors to see what they think the real value of it is if you get to touch a little bit of all those three circles."

Our informative and candid interview with Massrieh appears below:



Disclosure: None




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