Notes from B Riley 13th Annual Investor Conference: CEMI,VRML

There were some excellent small cap companies presenting at the B. Riley Investor Conference in Santa Monica this week. Five tracks covered companies in buy priligy australia healthcare, technology and energy, consumer/telecom, software and services and internet and media. Our focus within healthcare is biotechnology, tools and clinical diagnostics. Micro-Cap Plays in Clinical Diagnostics

Chembio (CEMI.PK  $0.52)  Market Cap $34M   Cash $2.95M

Chembio is an emerging growth player in point-of-care (POC) diagnostics with a focus in infectious disease with rapid tests for HIV 1&2, tuberculosis and syphilis with 2011 revenues of $19.4M. Total revenues for Q1 2012 of $6.65 M are on track for growth with operating income of $720k compared to a loss last year of $139k. Forecasted revenues for 2012 are $24.4M. A new “dual path” test platform called the DPP HIV 1&2 has begun a 3000 patient clinical trials that can be used with finger stick, oral whole blood or plasma. The market potential for HIV POC testing is $200M WW.Alere (ALR $18.50) is their marketing partner with revenues of $7.2M and Alere also holds an 8% equity position in the Company.Recently a competitive product from Orasure (OSUR $10.55) made headlines when the FDA recommended that their OraQuik HIV In-Home test  based on a moth swab be approved. A big opportunity for the future is an HCV test with a POC potential of $250M. Over a one year period the shares are stable up 7.28%. Management holds 12.3% of the shares.

Vermillion (VRML $2.49)   Market Cap $33.42   Cash $15.5M

VRML stock soared 36% today on high volume after yesterday’s B. Riley presentation with no apparent news except a lot of ” mentions” from small cap newsletters. Gail Page the ex-CEO presented an update of the Company with a focus on the OVA-1 FDA approved clinical biomarker test (multimarker IVDMIA) for ovarian masses that would replace a very old CA-125 test. 3952 OVA-1 tests were sold in Q1 2012  with a forecast of 4300 for Q2. The Company has a revenue sharing agreement with Quest (DGX $57) but has 10 reps of their own supporting the  Quest sales effort. A second product is under development called Vasclir Ova-2 a biomarker for identifying high risk populations for PAD (peripheral arterial diseases) utilizing beta-2 microglobulin with preliminary data expected in June.

see Face-off BGMD vs VRML

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