Are shares of this company priced fairly and accurately? That is the emailed question from a reader regarding Biovest International (OTCBB: BVTI.PK):
Just a note regarding this company. The value associated with Biovest is unknown relative to Dendreon. Thought you might take a closer look and give me your opinion. I think it should trade closer to $2.50 a share.
The above reader from Seeking Alpha states that "the value associated with Biovest is unknown relative to Dendreon." This is an accurate statement, as there is no comparison to be made with Dendreon or Provenge, aside from the fact that both Provenge and Biovest's BiovaxID are a part of the new era of cancer vaccines.
BVTI has swiftly moved higher after the numerous press releases that reference the positive data from this trial, although each time the stock has retreated back to previously traded levels. With all those positive updates, however, we've never been briefed on a clear path for approval for BiovaxID, whether in the United States or overseas.
Recent published reports by the company have stated that talks are in place with both American and European regulators to develop a course of regulatory action where BiovaxID could be reviewed for approval.
Many suspect that the "positive" Phase III data trumped so often by the company is not strong enough to gain muster with the FDA or the EMEA, and that general feeling is partly to blame for the deflated share price.
A more thourough compilation of the past couple of years for Biovest is described in THIS POST from just over one year ago.
To be fair, 2010 was a relative wash for Biovest because the company had the vector of bankruptcy hanging over its head, and at the time, the priority was to emerge from that mess in tact, even if it meant delaying the much needed discussions with the oh-so-bureaucratic drug regulatory agencies.
There's certainly an argument to be made that any company with a Phase III cancer immunotherapy product should be trading for significantly higher than the current sub-$100 million market cap of BVTI, but as I said before, I think there's doubt that BiovaxID is on the path for approval without having to conduct another trial.
That said, the volatility that always accompanies this stock makes it an intriguing trade play as well as a longer term 'cancer immunotherapy' play.
I mentioned earlier today that I consider BVTI a luke-warm buy right now, and any positive developments could run this to a double in short time - with speculation and day trading possibly driving it higher - but it'll take a significant event to keep this share price anywhere near two bucks for a prolonged amount of time.
Of course, this is all just my opinion.
Each investor should conduct his or her own DD and invest accordingly.
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