I spent a lot of time this spring learning about Stem Cell Technology. I now understand just enough to be completely uniformed and somewhat dangerous.
There are a couple of things I do understand about Stem Cells: 1. They represent a true potential “cure” for many very nasty diseases. 2. Stem Cells can literally “morph” diseased or damaged cells into healthy cells, and 3. The demand for effective Stem Cell therapies is going to go through the roof over the next 20 years.
I also understand there are two types of Stem Cells- Fetal and Adult. Fetal are far more robust and a bit schizophrenic. Adult are less potent, but a little more predictable.
Adult stem cells are completely non controversial. Fetal are controversial because there is a perception a future “potential life” must be lost in order to collect fetal stem cells. This is simply not the case.
Unless there is a major change in the current political climate, it would appear the recent gains made by conservatives are giving way to a more liberal approach to certain issues. This is not a political statement of postition- just an observation.
I have two offering in the Stem Cell arena- Advanced Cellular (OTC BB: ACTC), and Medistem (OTC BB: MDSM). Each offers different kinds of opportunity in the same space. Medistem, through a licensed clinic in Costa Rica, will be actually treating patients with adult Stem Cells in the near future.
Advanced Cellular, over the long term, has the more interesting science. They have demonstrated they can create Fetal Stem Cells from fertilized human eggs without harming the potential life. The fertilized egg can be taken to term.
They are going to be starting clinical trials for their therapies later this year and into 2007- they are focusing their intial energies on eye disease, dermal repair (burn victims and other maladies of the skin), and heart disease.
Their management team reads like a Who’s Who in the Stem Cell field. It’s a remarkable opporunity in microcap form. They have been mentioned twice in NY Times articles.
I believe this stock will trade beautifully at some point in the future- whenever the market turns its fickle attention back to Stem Cells. Late this year the $3 billion California initiative to fund Stem Cell companies should clear a bunch of legal hurdles- I believe that could be the catalyst that puts a charge back into Stem Cells stocks.
In the interim, if you want a microcap position in a high risk/high potential reward stem cell situation, ACTC fits the bill. Here’s a chart:
If you want a full explanation of the expected ups and downs in this stock, please go back and read the initial presentation- you will find it in the current profiles archive section.
In short, in the initial presentation I suggested the stock would be subject to monthly swings, and therefore should be accumulated on dips. The downdrafts are generated by $750,000 worth of free trading shares that are awarded to financiers with itchy trigger fingers every month.
Therefore, particularly in tough markets like this, we can expect this stock to swoon every month. It is a very predictable buying opportunity. Notice in the chart I have circled the two moves up and down in the two months I have been covering the company. This pattern should continue up until the time the market falls in love with Stem Cell stocks again.
If you are thinking long term, and want to own a piece of a wonderfully exciting microcap stock with very futuristic technology, accumulate this one on the dips.
Comments and questions are welcome.
are you aware that the stem cell companies are storing umbilical cords for families so that those stem cells may be used, if needed, at a later date for various diseases.
Editor: Yes, but I believe ACTC could make that old hat. Here’s why. Umbilical cords are adult stem cells, not fetal. ACTC has developed the technology to infuse a human egg with your dna. From that, they can actually create a stem cell line derived from your dna in fetal stem cells. I starts with only 8 cells. It was featured in a NY Times article when the performed the proceedure on a mouse embryo, and the mouse was then born healthy. This eliminates the moral objection. These stem cells are literally yours, and are far more robust than stem cells derived from an umbilical cord.
There’s lots of room for many companies and different technologies in the Stem Cell world. ACTC has some pretty unique stuff for a little, fairly unknown company.
Has the recient news played any role in the continuing drop in price?
Editor: No- I believe the current swoon is the result of the monthly stock issuance to their financiers (which I have covered exhaustively), and the horrendous sell off and climate of fear in the market right now. I also have written that this stock would have these monthly ups and downs as a result of the issuances. I believe it is very oversold and a great buy right now, even for a trade only. This current level is a bargain basement steal if you want a microcap in the Stem Cell sector with huge upside.
You wrote: “As covered exhaustively in past editions, the financiers of this company are awarded $750,000 worth of free trading shares every month, which leads to fairly predictable sell offs. This month’s “ration” has had an exaggerated effect on the stock price thanks to the drubbing the market has taken. A kind of “piling on” if you will.” So, that prompts my question, ‘Why in the world would an astute investor/financier give away their stake in the company for literally pennies?” If they are financiers, they are not stupid. Nobody who is able to be a financier makes that money making poor decisions. Thus, there must be something about this company that makes them sell their stock. And thus there must be an inordinately high degree of risk for this company. Ordinarily, one would want to hold stock of such a ‘promising company’ that might be only a year away from IND and then a couple of years from results. So, what are we not seeing that they are seeing that causes them to sell? BD
Editor: The financiers took a big upfront fee and hold millions of warrants at $2.55 as their upside in the company. If the technology proves out $2.55 could be a ten bagger a few years down the road.
looks like a downtrend in that chart to me. Wouldn’t you expect that if every month 750,000 shares were sold? I don’t like this one at all. I’m all for the stem cell technology, I just don’t think these guys are the ones to bet on.
Editor: Thanks for the comment. Hence- my SSL at $.75 and long term outlook. Their science is quite extraordinary. If the stock is trading well, 750k shares could be just a day or two of volume. If the market remains horrifying, it could be troubling.
Perhaps you should separate Advanced Cellular from Medistem on your blog. Now there is only Advanced Cellular and no blog for Medistem.
Editor: It would appear there simply isn’t a BLOG for MDSM- thanks for pointing that out. I will correct that oversight.Â
What’s happening at ACTC? They have had a change in management and their stock is around their all time low.
Editor: In my view, the $750k in free trading shares they issue every month have simply overwhelmed the stock in this low volume environment. I don’t know what is going to happen there. They have wonderful technology, and I’m sure the stock will have its day sooner or later. Stem Cells need to get hot on Wall Street again. My SSL on the stock was $.75, so if you are still in, you have to think long term at this point. It could struggle until that overhang is handled.
“Their management team reads like a Who’s Who in the Stem Cell field. It’s a remarkable opporunity in microcap form. They have been mentioned twice in NY Times articles”
Is that right?
Well, do they still have those two alien wannabes on the board of directors? You know the woman portraying Spock’s wife and the guy wearing the pyramid cap who held the press conference four years ago proclaiming they had successfully cloned a human being?
Just wondering.
Editor: I’m not sure why you are asking a sort of absurd, stupid question. The stock was up 357% yesterday. The biggest one day gain I have ever seen without a buy out. Their science was featured in Nature Magazine, and the stock took off like a Space Shuttle launch. Eddie, perhaps you should go back to watching reruns of Leave it To Beaver- clearly understanding an exciting opportunity in the microcap world might be out of your realm.Â
Any follow-up comments here? Now that the stock has retraced almost entirely last week’s huge gain, is it a buy or accumulate? I know it’s now below your initial SSL. Thanks in advance for your response.
Editor: Yes- the revelation has now drawn a tremendous amount of negative publicity. I don’t believe it is time to jump in. More on what’s going on in the weekend edition. Â
I am very interested in ACTC for de long term, and do yo know about the market potential for te company products?
Thanks for your article.
Editor: The very long term future for their products is about the biggest health related market you could possibly image. Here’s what they are working on: Stem Cell therapy to fix eye disease, heart disease, and skin burns. They are expected to start the process of going into clinical trials for their therapies in late 2007 to 2008. This is very long term stuff- many years before they will be a treatment that is FDA Approved. However, you shouldn’t have to wait that long for the stock to do well. As they continue to announce scientific achievements, the stock should do well.
I learning that only in the united states there are 165 million patients potential to be treated with stem cell therapies. I think that this number will increase in the coming years. What do you think about it?
And it could possible that the company to be listed in the nasdaq in the middle term?
Editor: A NASDAQ listing in the short to mid term is unlikely – the stock needs to be $4 to qualify, and have a lot more cash. AMEX would be the more likely mid term upgraded listing. There are 165 million potential patients for Stem Cell therapies. In the case of ACTC, it will be many years before any of the therapies will be available for doctors to prescribe in the US. However, as the company starts generating results that can be published, the stock could easily become much more valuable.
Hi. First of all thank you for answer mi questions.
Based on the technology platform of ACTC what do you think about the probability of succes in the clinical trials of their therapies?
I knowed that the clinical trials are succesfulled in the coming 5-10 years, the market cap of ACTC could increase more than any biotech stock because it targeted the biggest market. Is that possible?
I really like to talk about it, thanks.
Editor: Very early clinical data in animals suggest their eye disease therapy could be very effective. I don’t believe there is a lot of data on heart or skin at this time. However, this company could also be very instrumental in providing stem cell supplies to other biotech companies in this arena, which would require waiting for FDA approved products to start generating revenues.
Hi, would you think to make a diversified portafolio of many stem cell micro cap stocks like ACTC. What others stocks you recommend. Thank you.
Editor: ACTC is the only microcap stem cell I currently cover. It’s because of Dr. Lanza- despite being at a fairly obscure company in this arena, is acknowledged to be one of the foremost experts on stem cell research in the world. In the larger cap world, GERN and STEM are two of the leaders.