Premier Biomedical Inc (OTCMKTS:BIEI) Announces Positive Results
tags: BIEI
On Tuesday the stock of Premier Biomedical Inc (OTCMKTS:BIEI) got devastated – in just six and a half hours it wiped more than 41% of its value dropping all the way down to a close at $0.014. Yesterday, however, the sentiment displayed by investors changed drastically. Thanks to an intense buying that brought the daily volume to 11.5 million shares, the biggest daily volume seen by BIEI since the very first days of the year, the stock was able to bounce right back up and to close 50% in the green. Will this turn into a more prolonged recovery, though?
Yesterday’s positive performance was sparked by a new PR that was issued by BIEI before the start of the trading session. In it the company announced that its patent pending anti-cancer antibody, PBI-5D3H5, had demonstrated superiority based on tumor volume and mouse survivability in a multy-faceted mouse test compared to a commercially available competitive drugs. The announcement is indeed encouraging but jumping in without doing the required due diligence could be quite dangerous.
Let’s start with the financial state of the company at the end of the first quarter of the year. According to the quarterly report as of March 31, 2016, BIEI had:
• $39 thousand cash
• $55 thousand total current assets
• $360 thousand total current liabilities
• ZERO revenues
• $415 thousand net loss
The balance sheet can hardly inspire any confidence but thanks to a stock purchase agreement BIEI can raise up to $2 million through the sale of shares to Redwood Management, LLC. Investors should note, however, that these shares will be priced at a 20% discount to the lowest sale price of the company’s stock during the 5 previous business days. If you open the S-1 registration statement that was filed on June 24 you will see that a total of 50 million shares are being registered for sale by Redwood. Of that amount 16.9 million shares cover the conversion of a note issued on May 27 with a face value of $105 thousand while the rest are included specifically for sale pursuant to the purchase agreement.
In early trading today BIEI is falling down currently trading 14.29% in the red at $0.0180.
