Weekly thought on $AEMD, $DFFN, $IBIO, $LRAD, $MARK, $PI

Very interesting!

Last week, I mentioned about the broad market (DJ-30) having a parabolic run which could result in a correction sooner or later.  While I opted for the latter, the market wasted no time starting a correction in January 30 which effectively unseated 2018 at the 3rd highest percentage gain for January.  It is now at the fifth place at 5.79%.

Without a doubt, my port suffered as well but mainly because $MARK took a 20% tumble down for the week. Due to survival instinct, I peeled off shares of $MARK to stop the bleeding and reduce my risk.  I may add if the market bounces next week.  I also picked up some $PI simply for the “oversold” situation.  I’ve a close stop for $PI in case price continues to head south; but the risk/reward is looking pretty good at this low level.

This week, I accumulated a position in $DFFN (Diffusion Pharmaceuticals Inc.).  I considered myself lucky that I found out about $DFFN AFTER the dilution.  It would be pretty ugly if I’d found it before the dilution ’cause I would have bought it for the the science.  While I’m neither a medical doctor nor a scientist, I use logical deduction and common sense to determine my biotech picks.  If the science behind the biotech stock is too complicated for me to comprehend, I pass.  However, if the science is easy to understand at the general level, then it’s up to my logical deduction to determine the probability of success.

So what is so special about Diffusion Pharmaceuticals?

Here is the summary of my understanding: Diffusion Pharmaceuticals has a compound/agent known as trans sodium crocetinate (TSC) that can “diffuse” oxygen into the cells that have been deprived of oxygen (aka hypoxia) due to cancer, stroke, or whatever that cause the oxygen deprivation.  For scientific reason beyond my ability to explain in a sentence, cancer cells deprived of oxygen do not respond well to chemotherapy or radiation; therefore, by diffusing oxygen into cancer cells, it becomes responsive to chemotherapy and radiation. This is especially important when the tumor is inoperable for whatever reasons.

Below is a cut/paste from DFFN presentation:DFFN_HypoxiaThe above diagram shows the areas where TSC can reach which, if successful, would open numerous unmet medical needs in billion dollars markets.

As you can see, stroke is reflected in the diagram.  This make a lot of sense since the deadly effect of stroke is the dead of brain cells from lack of oxygen. TSC can come to the rescue by diffusing oxygen to the part of the brain deprived of oxygen after a stroke.  Imagine the first response medical team arriving on site where the patient had a stroke and immediately injected the stroke patient with TSC.  The level of damage may be minimized effectively with TSC; of course, assuming it will work as indicated.

Guess what, see below:DFFN_ClinicalPhase 2 Clinical Trial successfully completed!

Based on what I’ve read so far, I’m inclined to think that the probability of success for TSC is much better than 50/50 here.  When you think about it, TSC is not really a drug per se but more of a “conduit” for the drugs to travel. TSC doesn’t try to treat a disease so there is no major risk in drug efficacy. TSC only job is to diffuse oxygen to the cells; therefore, the major risk is in its ability to diffuse oxygen “successfully” to the cells.  Since Phase 2, as shown in above cut/paste, has already proven that TSC did successfully diffuse oxygen to the cells with no adverse effect, then the logical deduction is that there is no reason to believe it will fail on Phase 3 trial.  It’s like flipping a switch. You flipped it on, the light turned on. It worked!  You flipped Phase 2 switch, it worked! Now, flip the switch again on Phase 3 trial. All living cells love oxygen and if TSC can supply the oxygen where it is needed, all the better!  Oxygen is life.  We are ALL alive because of oxygen.  TSC diffuses oxygen, the cells welcomed it. End of story. Phase 3 will be successful!  Of course, it is my humble opinion only based on my logical deduction.  Right or wrong, it’s my own sword to swing.

Btw, the extent of the healing process after successful diffusion of oxygen from TSC will depend on the actual drug (chemotherapy, etc) itself; therefore, if the drug already has been proven to work in normal cancer cells (before hypoxia); then it should continue to be effective as before after administering TSC into patients. Phase 2 confirmed survival of “inoperable” patients increased by 380% at 2 years! So go figure.

Btw #2, since diluton already took place last month, the gate is wide open for good news to carry this stock higher.

That is how I feel about $DFFN.  We are talking about an unmet medical needs in a billion dollars market.  This mean $DFFN could become the pioneer in diffusing oxygen into cells.  And here’s the kicker, $DFFN current market cap is less than 20 million dollars. Now, picture TSC as the ONLY compound available in a billion dollars market and then picture how big Diffusion Pharmaceuticals Inc. can become when TSC proves itself once again on Phase 3 trial.

$IBIO definitely woke up on Friday. I think it might attributed to the current flu epidemic.Below is an excerpt from the article, “Flu pandemic: Are we ready for the ‘big one?’

“The way that the flu vaccine is created right now is in eggs, so that process is very slow. It takes about thirty weeks.”

Dr. Rachel Lee blames the long vaccine incubation time for the strain’s big impact in 2009.

“As soon as doctors could track the swine flu they were able to start making it in the eggs. But it took thirty weeks, and so we happened to miss the peak time when so many cases were occurring,” said Dr. Lee.

Did you see that? It takes 30 WEEKS to make vaccine in eggs! Imagine you’re running out of vaccine and you’ve no choice but to witness the impact of the epidemic for the next 30 weeks before vaccine will be available.  By then, more people will have died and more will be infected.  And the new batches of vaccine may not even be enough.

It saddens to see that it is going to take a major epidemic for the world to see the benefit of plant-based protein expression.  How quickly and cost effective it can be.  The strangle-hold of the old guards who spent hundred of millions building the old infrastructure to make vaccine will be losing its grip due to emergency crisis in pandemic attack.   Politic can only go so far when lives are at stake.

If iBIO can be recognized for what it could offer to the world in term of efficient and cost effective vaccine production, the company will become more relevant as time passed.  And we haven’t even talked about fibrosis yet. And there lies the challenge ahead which is hanging on to the shares while price continues higher in a roller coaster fashion.

$AEMD got an update from management during the earning conference call.  Below are what I think are important key points for future success per my logical deduction:

  1. in March we concluded our feasibility study and disclosed that we’ve successfully met our primary study objective which was to demonstrate safety in health compromised individuals infected with a viral pathogen.
  2. our Hemopurifier was awarded an expedited access pathway designation by the FDA, which has since been transitioned as the FDA’s breakthrough device program
  3. We also received a contractor from the National Cancer Institute related to our endeavors to diagnose, monitor and treat cancer.
  4. At present we maintained a cash position of approximately $6.5 million and in regards to market liquidity,
  5. we added two new directors Sabrina Martucci Johnson and Dr. Charles Fisher.
    1. Sabrina was previously involved in advancing the PROSORBA column on a clinical staged device to an FDA approved treatment for severe rheumatoid arthritis. That device was subsequently acquired by Fresenius.
    2. Chuck was also appointed to be our Non-Executive Chairman. He played an instrumental role in the advancement of Enbrel and Humira to market and also led the registration of the first therapy to treat sepsis.
  6. Under our breakthrough device designation the FDA allowed the following indication of use.
    1. The Hemopurifier was a single use device indicated for the treatment of life threatening highly glycosylated viruses that are not addressed with an approved treatment.
  7. Beyond viral pathogens tumor-derived exosomes, represent another life threatening glycosylated disease target that is not addressed with an approved therapy.
    1. Tumor-derived exosomes have also been reported to cause the functional arrest of T cells, which they may also inhibit the benefit of emerging immuno-oncology drugs and CAR-T therapies.
    2. Our team then demonstrated the ability to release captured exosomes for analysis and quantification purposes. We expect to complete our Phase 1 contract later this summer and then plan the pursuit with Phase II contract award.
  8. From Q&A:
    1. And we really had – we’ve always had success in inserting the gene working with different plant based protein producers that work in tobacco. Never had a problem in inserting the gene or isolating the GNA out it’s just that we never saw the affinity or the activity that we normally seen from the natural product until we started working with a group called iBio in Texas – in Bryan, Texas. And they have a remarkable facility down there and we’ve work through Michel feasibility study to demonstrate that we can get activity that equals or exceed the activity we see normally from GNA via from the natural source.

      So we think that that’s a solution that kind of can unlock large scale production in a manner where we can have a price point that makes – that gives us very favorable margins. And that’s something we are working through right now. At present, when we have been manufacturing cartridges they are usually in lots of 120 to 200 cartridges before the clinical study or some other type of research program. So manufacturing is something that we think about an awful lot in advancing our capabilities on multiple fronts. But that production in GNA is a key component.

In summary, AEMD has the cash (no dilution worry in the near future); they’ve the “right” directors to take the company to the next level; they’ve the interest of National Cancer Institute with the possibility of advancing to Phase 2 trial by summer; and finally, they’ve the support of $IBIO in providing them the key GNA component as cost-effective price that give them a “very favorable margins”.  Buy and hold!  Even if you’re a trader, you should have some core position for buy and hold.  That’s my 2 cents.

$LRAD, without a doubt in my mind, will become very relevant soon enough.  Per their recent presentation, the company are working with three of the potential prime contractors to provide communication capabilities for various “wall” programs.LRAD_BorderI see LRAD may have a chance to win bids for the border walls if it is to be built.  And this is on top of potential massive orders from the military for LRAD as well as civilian installation of their mass notification systems.  This little known company is finally becoming relevant in the current environmental and economic climates.  LRAD’s mass notification systems are going to replace those old bullhorns and legacy speakers in years to come.  That’s my take of it.

Despite correction to my port due to $MARK, $AEMD, $LRAD, I’m excited about the prospect of my port.

Current positions:

Main port: LRAD  IBIO  AEMD  DFFN  MARK  PI & cash (up 3.60% YTD)

Trading port: MENXF IBIO

My 2 cents

From my camera:008Btw: Wish you all have a fantastic SuperBowl Sunday!



Categories: Daily trading Journal, trading journal

Tags: , , , , , ,

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