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What Do Medivation And AtheroNova Have In Common?

|Includes: AHRO, Medivation, Inc. (MDVN)

What Do Medivation And AtheroNova Have In Common?

Medivation Inc. (NASDAQ: MDVN) is a classic Wall Street success story. Founded by a group of experienced professionals, the company acquired early stage pharmaceuticals and medical devices that had promising clinical, intellectual property and commercial prospects and grew from just $5.00 per share in 2010 to nearly $60.00 per share three years later. The majority of this growth happened in late 2011/early 2012, when the stock appreciated nearly 500% after successful clinical trials unlocked significant value in its product pipeline. [1]

Behind the scenes of this success, was biotech investment fund manager Fred Knoll, via his firm Knoll Capital Management, as a key investor. The fund began building a stake in the company in early 2006, where it acquired about $7.2 million worth of stock, according to regulatory filings. By the same time in 2007, the fund had increased its share ownership and the $66 million position became the largest in its portfolio. And, according to the fund's most recent regulatory filings, the stake is now worth more than $130 million today. [2]

Taking a New Biotech Under the Wing

Fred Knoll may be interested in another unique biotech play, based on his involvement in a fund called Europa International Inc. With Knoll Capital Management as an advisor, Europa International acquired a shell holding company that reverse merged with a biotech company called AtheroNova Inc. (OTCQB: AHRO) to take it public. The stock has since been quietly trading - much like Medivation - whilst pursuing clinical trials. If Mr. Knoll is right about this company, as he was with Medivation, the stock could see significant upside from these levels. [2]

AtheroNova's most advanced candidate, AHRO-001, is a proprietary compound administered via tablet that dissolves plaque within arterial walls, through a process known as delipidization, and then safely remove it from the body using a natural metabolic process. With the statin industry producing many blockbuster drugs - including Pfizer Inc.'s (NYSE: PFE) Lipitor® as the best selling drug in history - there's clear potential in a safer and more efficacious solution that gets to the root of the problem rather than simply addressing a symptom like LDL cholesterol levels. [3]

To see early anecdotal evidence of efficacy, check out the following video:


Bumping Up the Stakes in Recent Months

Fred Knoll has steadily been bumping up Europa International's stake in AtheroNova over the past few months, judging by recent regulatory filings made with the SEC. On March 12, 2013, Mr. Knoll purchased some 1.4 million shares at $0.24 a piece on behalf of Europa International, bringing the fund's total ownership stake up to 1,867,511 shares. While this may not seem like a large stake, the same could be said of Mr. Knoll's initial stake in Medivation back in 2006. [2]

In addition to the financial stakes being bumped up, Fred Knoll himself joined AtheroNova's Board of Directors in November of 2012. As a leading investment manger, Mr. Knoll brings a wealth of knowledge to the company as it transitions to the next phase of its development. The move also represents confidence in the company's management team and technology on the part of Mr. Knoll, which is significant given his experience in the industry as an investor. [3]

Takeaway Message for Investors

Fred Knoll has become a legend among biotech investors by growing his stake in Medivation from $7.2 million in early 2006 to more than $130 million today. With his involvement in AtheroNova on the ground floor, investors may want to take a look at building a stake of their own, especially given recent purchases by Europa International on the open market. The ability to disrupt the statin market could represent a multi-billion dollar product opportunity, capable of generating significant shareholder value over the long-term.

Request more information on AtheroNova (OTCQB:AHRO) here:



Disclosure: I am long OTCQB:AHRO.

Additional disclosure: I have purchased 250,000 shares of AHRO.