SeeThruEquity, an independent small cap and microcap focused equity research firm started covering M Pharmaceutical (CSE: MQ) (OTCQB:MPHMF) on Monday with a price target of US$0.65/CAD$0.79 per share, implying an upside of 315.8% from a June high of $0.19.
SeeThruEquity is an approved equity research contributor on Thomson First Call, Capital IQ, FactSet, and Zack's.
Vancouver based M Pharma is pursuing an ambitious brand development strategy as it builds on a successful round of biotech acquisitions focused on the treatment of diabetes and obesity.
Over the past three months, M Pharmaceutical Inc. has acquired three biomedical technologies addressing obesity and diabetes in a less invasive manner than its market competitors. This process started with M Diagnostics, as announced last February 19, which held the right to eMosquito.
The eMosquito Wearable Blood Monitor, deploys mosquito technology for automatic and autonomous monitoring of blood glucose by diabetics.
Typically, diabetics prick their fingers to monitor their blood glucose levels, which can be painful. The eMosquito, however, is designed to be worn like a patch, with small needles to puncture the skin just deep enough to draw blood without damaging any nerves, causing little or no pain at all.
The other key technologies are TriMeo Weight Loss Capsules, a drug free, individually controllable solution that induces a feeling of early satiety and the TriMtec Gastric Stimulation System, an innovative and minimally invasive surgical solution for significant weight loss.
"The company has recently completed several key strategic actions in its corporate structure, including the appointment of industry pioneer Dr. Martin Mintchev as CEO, , three strategic acquisitions to fuel growth and development, and several impressive additions to its Board of Directors and Scientific Advisory Board," stated Ajay Tandon, SeeThruEquity's CEO.
The analyst suggests M Pharma can draw tremendous potential when it gets regulatory clearance for its promising family of biomedical technologies addressing the multi-billion dollar obesity and diabetes sector. This market should grow 6.9% per year, rising from C$148.1 billion in 2014 to an estimated C$206.4 billion in 2019.
Indeed, the International Diabetes Federation (IDF) expects the number of people living with diabetes to rise from 387 million in 2014 to 592 million by 2035, which will dramatically increase global demand for treatment and control of the disease. The market research firm Frost & Sullivan has estimated the global market for blood glucose products to be US$8.67 billion a year.
M Pharma first listed on the market after merging with an existing public company in February 2015. Over the past few weeks, M Pharma completed a 10:1 share consolidation to bring shares outstanding more in line with peers.
On June 15, M Pharma was recently approved to trade on the OTCQB under the ticker MPHMF. The analysts see this as favorable development on the way to expanding its institutional shareholder base. Moreover, the company is building highly competent leadership, which, as a development stage enterprise targeting a large market, is essential.
One of the leadership keys is Dr. Martin Mintchev, a medical technology pioneer. He became president and CEO on April 15, 2015. Dr. Mintchev was the primary developer of the medical technologies held by M Pharma.
In May, Douglas Janzen, who co-founded Northview Ventures, joined M Pharma's Scientific Advisory Board. Janzen is uniquely qualified to understand the investment dynamics of the biotech sector, having been an investment banker with Cormark Securities, specializing in life sciences before taking on sector leadership roles. He has completed over $1 billion in equity financing for Canadian bio-tech companies and has previously served as chair of LifeSciences BC and as a director with Biotech Canada. Notably, he serves as CEO and Director of Aequus Pharmaceuticals (TSXV:AQS), a director of Neovasc Inc. (NASDAQ:NVCN) and former CEO of Cardiome (CRME).
M Pharma is pursuing a diverse development strategy as it builds on a successful round of biotech acquisitions focused on the treatment of diabetes and obesity.