Generex Biotechnology Corp. (OTC:GNBT) Recovers Lost Ground

Most biotechnological companies run a race against time, with a long development period and uncertainty until the therapies or products achieve lasting marketing success. This is the case of Generex Biotechnology Corp. (OTC:GNBT), a company that claims it is viable for NASDAQ listing, but still has too many products in preliminary trial.

The ticker is relatively cheap at 3 cents and in the past month went through a small rebound despite the lack of official paid or free promotion. Instead, GNBT was featured in several press releases, showing its promise for the next year. The latest piece of news stated that the company presented its developing breast-cancer vaccine to a specialized penny stock expert, the Micro Cap Review.

While the company has not suffered from lack of publicity, its financial data are weighed down from the long development period:

• $367,031 cash

• $3.68 million total assets

• $12.5 million total liabilities

• Zero revenues

$758,496 net loss for latest quarter
The experimental vaccine may be slow to arrive to market, since it just finished Phase II, is facing another stage and perhaps years of waiting before final FDA approval. So far, the stock has slipped slowly over a period of three years and only forward-looking data help to boost it from time to time. And only the future will show if Generex manages to improve its bottom line and list on the more active and respected NASDAQ.

The company’s plans for the next year include significant restructuring, by spinning off the subsidiary Antigen Express that deals explicitly with the vaccines. The current shareholders of Generex will receive a portion of the Antigen Express stock, while Generex seeks a reverse merger that could help launch it on a regular stock exchange.

The graph for GNBT resembles that of Amarantus Biosciences, Inc (OTC:AMBS), another pharmaceutical developer with great promise but still little marketing success. The ticker was mentioned several times in CashMoneyPlay mailings, with a $7500 budget, and it has the December spike to show for the pump. Afterwards, left to its own devices and promises of future success, AMBS slumped down by about 50%.

In the case of pharmaceutical companies, it is best to check well their risk factors and keep in mind that some of the hype surrounding them has little to do with the success of their discoveries.