Gene Marcial, Business Week’s Inside Wall Street columnist, likes BioSante Parmaceuticals (BPAX):

a. Developing products aimed at restoring the loss of sexual desire in women. LibiGel, is what’s attracting investor attention. LibiGel is a testosterone gel aimed at sexual dysfunction in menopausal women. BioSante recently initiated its second of two Phase III clinical trials after the Food & Drug Administration awarded it a “special protocol assessment” approval to test the product for safety. Data from that study are expected to be released in 2009.

b..  If all goes well, BioSante could file for a new-drug application with the FDA by late 2009.

c. The big question is, does LibiGel work? If LibiGel completes the safety clinical trial with success, the product will address a multibillion-dollar market.

d. BioSante could end up being acquired by a Big Pharma concern in the not-too-distant future. That’s because BioSante has hired Deutsche Bank Securities to review strategic alternatives, including selling the company. Without any deal, whether a sale or at least a partner, BioSante would have to raise capital for the clinical trials and eventual production of LibiGel.

e. Some analysts figure BioSante could be acquired for about $11 a share.

f. BioSante has other drugs in its pipeline: Pill Plus, a hormone contraceptive for women in Phase II trials, a facial line filler in aesthetic medicine, and CaP, a patented calcium phosphate technology for use as a vaccine adjuvant and for drug delivery.

g. BioSante has one FDA-approved product already on the market: Elestrin, to reduce hot flashes in menopausal women. Its marketing partner for Elestrin is Nycomed, which has paid BioSante $14 million in up-front and milestone payments. BioSante has rights to receive more milestone payments of up to $40 million, plus royalties from sales of Elestrin, launched in June, 2007.

g. But it’s optimism about LibiGel that is driving analysts to recommend BioSante’s stock.

CONCLUSION:

Huge potential market value of LibiGel and its other products—plus a possible takeover, to boot. If any Big Pharma names come calling, BioSante will soar.

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