By Brad Sorensen, CFA
OTCQB:BSEM
READ THE FULL BSEM RESEARCH REPORT
BioStem Technologies, Inc. (OTCQB:BSEM) is a leading innovator focused on harnessing the natural properties of perinatal tissue in the development, manufacture, and commercialization of allografts for regenerative therapies. The company states its mission is “to discover, develop and produce the most effective regenerative medicine products in the world,” and we believe that the company is well on its way to achieving that goal—providing to investors what we believe is an opportunity to invest in a company that is both providing a vital service to the human population and providing economic value to shareholders when doing so.
We have written before how the market for products BioStem has developed and is continuing to develop is extensive and this cutting-edge technology can prove to be a game-changer to many patients suffering from painful and slow recoveries. An increasing number of entities are recognizing the superiority of the BioStem products, and a string of recent announcements confirms our long-held belief that demand for those products would increase at a rapid rate as word got out. The company recently announced that:
• Lovell Government Services, which describes itself as a “highly reliable government partner that has a proven track record of successfully connecting suppliers with government markets,” is now listing BioStem products on key government contract systems.
o We have long believed that the military is one of the key areas that could benefit from the BioStem technology, and this relationship is one that we believe will greatly bolster the demand for BioStem products.
• The company announced that NovaBay Pharmaceuticals (NYSE:NBY) has come to an agreement to commercialize BioStem’s Amniotic Tissue Allograft, which is intended to be used as a protective cover during repair done to ocular (eye) surfaces.
o These are the types of deals that we believed were coming and that similar deals will continue to be announced. Having partnerships with already-established health care providers bolsters visibility and demand for BioStem products.
• As an example, shortly after the company announced the above deal, BioStem announced that Venture Medical, which is a leading distributor of various medical devices including biologics, will be distributing the new AmnioWrap 2 product. This product is described as “an advanced biologic skin substitute that is meticulously processed to offer an extensive range of wound healing and wound care solutions.”
o Another example of BioStem expanding its product line and market size that bodes well for future revenues.
Summary
We reiterate our belief the BSEM is still underpriced even after its recent move higher and continues to represent a good opportunity at recent prices for investors to get in before what we believe will be a more aggressive move higher in the not-too-distant future. The vision management has for the company’s product and the focus they are using to deliver results are encouraging and are now being rewarded by increased demand. As such, we suggest investors with a modestly higher risk tolerance take a look at BSEM.
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