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Why NeoStem, Inc. Shares Popped

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of NeoStem, Inc. (NASDAQ: CLBS  ) closed the trading day with a gain of roughly 9% after peaking in the morning at a 10% pop. The small biotech company is enjoying a wave of positive sentiment after announcing that it has been granted two new patents for its CD34 cell program.

So what: NeoStem's patents cover "Compositions and Methods of Vascular Injury Repair," according to the company's press release, and will protect a broader range of serum concentrations for CD34 cell delivery than did earlier patents. CD34, which is developing treatments for ischemia (a restriction of oxygenated blood) now boasts 16 patents, and the latest two cover AMR-001, which is the most promising treatment in the CD34 program. AMR-001 is a stem cell product derived from bone marrow that is designed to increase blood flow by aiding the development of new blood vessels, and its Phase 2 study wrapped up at the end of last year, with full data expected in the latter half of 2014.

Now what: NeoStem investors have been waiting years to see genuine good news about its pipeline, and the lack of such news has contributed to a 10-year loss of 94%, and a five-year loss of 63%, of the stock's value. A couple of patents aren't much to cheer, especially when they cover a treatment that hasn't begun phase 3 trials yet -- it's standard practice in the industry to patent newly developed treatments, and such events matter far less than the treatment's eventual approval. I wouldn't read anything into today's patent news -- Neostem is the same company today that it was yesterday, except with two more patents in its hands.

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Read/Post Comments (4) | Recommend This Article (4)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On May 27, 2014, at 5:54 PM, mariocuturic wrote:

    You really have no clue as to what is going on with NBS. Try to talk to fellow FOOL Brian Nichols who also writes for Motley Fool. He wrote some really good articles on NBS while he was with Seeking Alpha. This stock will double or triple between now and November.

  • Report this Comment On May 27, 2014, at 8:01 PM, MCF00 wrote:

    Let's make a more informed supposition and say that the upward pps movement had little or nothing to do with the patent thing. What a novel thought, indeed!

  • Report this Comment On May 27, 2014, at 8:22 PM, brandonchen wrote:

    "I wouldn't read anything into today's patent news -- Neostem is the same company today that it was yesterday, except with two more patents in its hands."

    How can the company be THE SAME, when they now have two more patents ? Have you quantified the value of the patents ?

  • Report this Comment On March 13, 2015, at 8:23 PM, rsdl wrote:

    I bought NBS stocks for pennies, and I see it has gone to $4+ dollars. I think it will eventually reach a higher price. It's one of my SPECULATION stocks.

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Alex Planes

Alex Planes specializes in the deep analysis of tech, energy, and retail companies, with a particular focus on the ways new or proposed technologies can (and will) shape the future. He is also a dedicated student of financial and business history, often drawing on major events from the past to help readers better understand what's happening today and what might happen tomorrow.

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Related Tickers

8/28/2015 4:00 PM
CLBS $1.44 Up +0.08 +5.88%
Neostem, Inc. CAPS Rating: ***