Q BioMed Inc (OTCMKTS:QBIO) Closes the Year With a Bang

Q BioMed Inc (OTCMKTS:QBIO) Closes the Year With a Bang

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Q BioMed Inc (OTCMKTS:QBIO) is a micro-cap name in the biotech space that we have held in high regard during the second half of the year. In our September piece on the company, we noted that “there could be a ton of opportunity here”. The stock has launched higher since that time, and continues to break out anew. In fact, on the last trading day of 2016, the stock made a new closing high for the year and major two-day run.

In all, traders will note 75% piled on for shareholders of the stock during the trailing month. This is emblematic of the stock. QBIO has a track record that includes a number of dramatic bounces. Furthermore, the name has witnessed a pop in interest, as transaction volume levels have recently pushed 81% over what the stock has registered over the longer term. It pays to take note of this fact with a float in play that’s very limited — not even 6M shares. It’s something the veterans know to key on: a restricted trading float and a jump in trading volume can crimp supply and push share prices higher.

Q BioMed Inc (OTCMKTS:QBIO) bills itself as a biomedical acceleration and development company in the United States. The company focuses on licensing, acquiring, and providing resources to life sciences and healthcare companies. Its primary target indication is for a therapeutic eye-drop for the treatment of glaucoma in adults. The company’s lead candidate is MAN-01.

The company was formerly known as ISMO Tech Solutions, Inc. and changed its name to Q BioMed Inc. in July 2015. Q BioMed Inc. was founded in 2013 and is based in New York, New York. QBIO is a biomedical acceleration and development company. The Company is focused on licensing and acquiring biomedical assets across the healthcare spectrum. QBIO is dedicated to providing these target assets the strategic resources, developmental support, and expansion capital the need to ensure they meet their developmental potential, enabling them to provide products to patients in need.

According to company materials, QBIO “is a biomedical acceleration and development company. We are focused on licensing and acquiring biomedical assets across the healthcare spectrum. Q is dedicated to providing these target assets the strategic resources, developmental support, and expansion capital the need to ensure they meet their developmental potential, enabling them to provide products to patients in need.”

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Right now, there are two primary stories for this stock: new capital and a licensed radiopharmaceutical agent indicated for the treatment of pain associated with metastatic bone cancer.

In the first case, the company recently entered into a definitive agreement with Yorkville Advisors Global for up to $4,000,000 of convertible debentures. The company has already closed on the initial tranche of $1,500,000 and expects to close on the balance pending the effective registration of the underlying shares. That represents access to cash on good terms. In a small float biotech, that generally leads to breakouts, like what we are seeing here.

In the second case, SR89 provides long lasting relief for patients suffering from bone pain due to metastatic cancer, typically caused by advanced-stage breast, prostate or lung cancer. The drug is preferentially absorbed in bone metastases, it has been proven to provide a long-term effect resulting in non-narcotic cancer pain relief and enhanced quality of life. This palliative drug is expected to start generating revenue in less than 12 months. We felt the deal looked promising, and it would appear the rest of the marketplace is starting to agree with that view.

The license agreement finalizes an announcement made by the company in June 2016. A completed agreement would expand current and future revenue estimates and legitimize management and operational expectations. That also plays into the running action stemming from their initial program with MAN-01, a small molecule designed to treat glaucoma, an eye disease which affects 60mn people globally, and is expected to affect over 100mn people by 2020.

The glaucoma market is a $5 billion annual market opportunity, for which no new drugs have been approved in approximately 20 years. The company acquired an exclusive license to MAN-01 from Mannin Research, Inc.

At this time, carrying a capital value in the market of $54.5M, QBIO has virtually no cash on the books, which is balanced by about $2.7M in total current liabilities.

QBIO is pulling in trailing 12-month revenues of $1.3M. However, the company is seeing declines on the top line on a quarterly y/y basis, with revenues falling at -62%. This is an exciting story, and we look forward to a follow-up chapter as events transpire. For continuing coverage on shares of $QBIO stock, as well as our other hot stock picks, sign up for our free newsletter today and get our next hot stock pick! For continuing coverage on shares of $QBIO stock, as well as our other hot stock picks, sign up for our free newsletter today and get our next hot stock pick!

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