Manzo Pharmaceutical (OTCMKTS:MNZO) Breaks the Silence

Manzo Pharmaceutical (OTCMKTS:MNZO) announced yesterday that they have started testing their Lacto-Freedom lactose intolerance treatment on humans. This, apparently, is the last major step before commercialization which, the management team have said numerous times in the past, is not dependent on an FDA approval.

The market’s reaction was instantaneous. 136 million traded shares pushed the stock 133% in the green which resulted in a close of $0.0007 per share and a dollar volume of nearly $105 thousand. Clearly, investors see yesterday’s press release as a reason to put their money on the line. Apparently, however, they reckon that it’s the only one.

Prior to the news, MNZO had some serious problems both with volume and with price. Trading was hideously slow and the ticker was slowly but surely sinking towards the bottom. We for one, aren’t particularly shocked by this.

In fact, in light of the financials, it is a bit of a surprise that MNZO managed to avoid hitting the absolute bottom of $0.0001. Here’s what the latest quarterly report looks like:

• total assets: $13,612 in cash
• total liabilities: $220,112
• revenue: $61
• net loss: $247,012

As you can see the Lacto-Freedom isn’t MNZO‘s only product. They also have a couple of sleeping aid pills and a treatment for colic pains for babies that are already on the market. In March, the management team proudly announced that they will try to push the company forward by launching their Tummy Relief in retail stores. As you can see, their efforts resulted in revenues of exactly $0.67 per day during Q2.

There is a bit of a gap between what the management team, led by Kenneth Manzo, say and reality. Unfortunately, if you dig deeper, you’ll see that this might be something of a trend.

Several years ago, Mr. Manzo wasn’t part of MNZO, but he was still trying to commercialize his lactose intolerance ailment. He said that he was going to do it with the help of a public company called MedGen, Inc f/k/a Northstar Global Services, Inc. (OTCMKTS:MDIN). As you might have guessed already, instead of making them rich, MDIN left investors quite disappointed.

More recently, Mr. Manzo signed the latest quarterly report which says that MNZO is authorized to issue up to 950 million shares. According to Wyoming’s Secretary of State, however, the A/S count is pegged at 1.9 billion. Even if we disregard all these mistakes, we’re still finding it hard to believe in the outstanding potential of a company that uses a PO box as the address of its corporate headquarters.

Then again, that’s just us. You might be feeling more optimistic about MNZO‘s future and you might be willing to take the risk. Before you do anything, however, you should definitely be aware of the fact that at the end of Q2, there was about $45 thousand worth of debt convertible at a 45% discount to the market price. If the note holders convert the amount, they will end up with a big number of cheap shares and an even bigger profit opportunity.