Collins Stewart gives microRNA drug development company Rosetta Genomics Ltd. (Nasdaq:ROSG) a "Buy" recommendation. "Rosetta is on schedule to launch two of its diagnostic products in the first half of 2008."
The investment house notes, "The first diagnostic test will be used to differentiate between squamous and non-squamous lung cancer…We believe this non-invasive diagnostic test will be a useful tool for oncologists. The second diagnostic product expected to launch in the first half will aid physicians in distinguishing between mesothelioma and adenocarcinoma. Again, differentiating between the two will have important treatment implications. With the increasing number of treatment options, we believe being able to pinpoint specific cancer types will allow physicians to make informed decisions and optimize treatment programs."
Collins Stewart also points to the company's CUP assay, which allows physicians to identify the primary origin of a patient’s metastases and then treat that patient with the appropriate therapeutics, and is expected to launch in the second half of 2008. "We believe this non-invasive tool will prove to be extremely useful in the clinic," it says. Collaboration with Isis Pharmaceuticals Inc. (Nasdaq: ISIS) on in vivo assessments of Rosetta's antisense oligos is also due to begin soon.
Finally, Collins Stewarts notes that Rosetta continues to expand its intellectual property portfolio, and that the company now has the rights to the majority of human and viral microRNAs for product development. It is also developing proprietary protocols surrounding microRNA extraction and analysis. The investment house concludes, "We believe that as the microRNA field increases in popularity, Rosetta will be in a unique position to build a licensing and royalty franchise."
Rosetta posted a net loss of $2.2 million for the third quarter, the same as for the corresponding quarter of 2006. Third quarter R&D expenses were $1.4 million, also unchanged from the corresponding quarter. The company's only revenue was $424,000 from financing.
The company had $32 million in cash, cash equivalents, short-term bank deposits, marketable securities and long-term investments at the end of September, compared with $10.8 million at the end of 2006. The company said, "Due to recent developments in the credit market, we have reclassified some of our marketable securities, which are all rated AAA, as long term investments."
Rosetta closed at $6.27 on Friday, giving a market cap of $74 million.
Published by Globes [online], Israel business news - www.globes-online.com - on November 12, 2007
© Copyright of Globes Publisher Itonut (1983) Ltd. 2007