RGEN posted a 52-week low on Friday and appears to be losing the hearts and minds of investors.  Could be a good time to invest!

Repligen Corporation (RGEN) is a biopharmaceutical company focused on the development of novel therapeutics for neurological disorders.  It is unique in the world of biopharma for several reasons…it has significant income already and it is sitting on a huge amount of cash.  Biopharma companies are traditionally very volatile.  Well, the pendulum for RGEN has been swinging the wrong way for quite a while.  I would not be surprised to see that pendulum swing back.

The news that “drove a stake in theheart” of RGEN’s stock price was the news that one of their drugs, a pancreas imaging agent designated RG1068, did not meet its main goal in a late-stage clinical study.  In an overreaction typical of the biopharma space, the stock tanked.  While the company tried to put a positive spin on it, it was clear that the drug has problems.  According to the company, they will determine the drug’s future after discussions with the FDA in early 2010.

What this news overshadowed, in my mind, is that RGEN is SO MUCH MORE than just this one drug.  Fiscal year end 2008 and 2009 (March 31st) showed a profit for the full year.  While the company is operating at a Quarter-over-Quarter loss this year, the company is on a run rate to book revenues of over $20MM.  The company has an absolutely ROCK SOLID balance sheet….cash and equivalents of over $42MM and NO LONG TERM DEBT.

RGEN’s recent news hasn’t been all bad either. Shortly after the RG1068 announcement, RGEN ann0unced the the Muscular Dystrophy Association (MDA) awarded them a grant for $731,000 for further research into new treatments for Friedreich’s ataxia.  This grant will support the completion of preclinical GLP toxicology testing and GMP manufacture of a drug candidate for human clinical trials.  The company believes that this funding is significant because it is evidence of support from the MDA not only provides important funding for Repligen’s research but it also provides access to a global network of scientists, physicians and patients.  This is the second research grant that RGEN has received from the MDA to support its Friedreich’s ataxia program.

To the Chart!

Clearly, RGEN is on a negative trend and no one call a bottom.  However, the stock bears watching.  It has the kind of balance sheet, revenue stream, position in the industry that makes me believe that this dip in stock price could only be temporary.  It has heavy insider and institution ownership, the short percentage is under 5% and is sitting on lots of cash.

Radar RGEN.…any good news will easily recover the lost value in the shares and the company has the financial wherewithal to “stay in the game” for a long, long time.

Good luck and good trading,

Jeffrey Dean, Editor

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