Biozone Pharmaceuticals, Inc. (OTCBB:BZNE) In the Red, Remains Mysterious

Biozone Pharmaceuticals, Inc. (OTCBB:BZNE) is continuing its odd behavior, sinking again by more than 16% to stand at $0.453. The ticker was traded on volumes above $866,000. Without a promotion or a PR, BZNE remains heavily driven by the influence of inside investors, and is yet to prove itself as an active mover that is carried by wide investor interest.

For BZNE, the behavior of investors who put large sums into the company speak of a potential for development. Dr. Phillip Frost, along with MusclePharm, underline the possible success of the QuSomes technology which BZNE has patented and currently uses in cosmetics. In the future, MusclePharm looks forward to harnessing this technology into its athletic supplement products.

In the shorter term, BZNE is finding its legs after trading as an exotic, rarely visited position among pharmaceutical stocks. Not even the involvement with consumer cosmetics and OTC medicines, a booming sector, has helped BZNE gain constant positions with a larger investor base. The company has just about 70 million shares outstanding, with about 25% into the holdings of Dr. Frost.

MusclePharm holds a convertible debt and warrants that would be a positive only in case BZNE achieves business success. The debt of $2 million, a substantial cash injection for the firm, is convertible at 20 cents per share, and there is an option to purchase 10 million shares at 40 cents within 10 years- something of a dilution, but not a thing that could sink BZNE.

BZNE shot up after presenting to an investors’ forum in San Francisco. The event lifted up another almost forgotten ticker, International Stem Cell Corp. (OTCMKTS:ISCO), a stem cell researcher that is currently only using animal models. Still, ISCO shot up from low activity and a drifting share price to a small peak at 18 cents on two consecutive days of buying.

No amount of success, not even the promise for a large subsidy, are enough to keep a biopharmaceutical stock afloat, if investors grow tired. Currently, Soligenix, Inc. (OTCBB:SNGX) is sinking below the $2 levels in a slow downward trend, as the good news effect is wearing out, and the question stands if the stock has power to find a bottom and restart the climb.

If you are still interested in the mystery of BZNE, keep in mind that the stock is weighed down by potential insider selling or divestment. Choose your time frame well, and avoid investing unless you can afford to wait or lose.