I am willing to bet that more than a few readers have
experienced the painful medical condition that I suffered about a
It started soon after the birth of my son. I was awakened in
the middle of the night with a searing pain in my abdomen that
radiated up into my chest. At first, I was terrified, thinking I
was having a heart attack.
Fortunately, the hospital was less than a mile away from our
home. I decided to drive myself to the emergency room to avoid
waking my family.
The emergency room personnel determined that the source of the
pain wasn't my heart and that there was nothing wrong with my
gastrointestinal region. By that time, the pain had faded, and
the hospital gave me a clean bill of health, along with a
prescription for painkillers.
Several days later, the debilitating pain returned. It lasted
a few hours and then began to fade again.
This began to occur at least once a week, and I visited
several medical facilities to determine the cause. No one was
able to diagnose the cause, and painkillers remained the only
solution to help me stay functional when the pain
Finally, I visited a specialist who diagnosed me with an
impacted kidney stone in my urinary tract. The stone was very
small, but it periodically caused built-up scar tissue to break
away, resulting in my excruciating condition. I underwent
surgery, and the condition has never recurred.
This problem made me realize that, despite all the
technological advances of modern medicine, medical diagnostics is
still in the dark ages. Even something as common as kidney stones
can go undiagnosed for months while the victim continues to
suffer both mentally and physically until the problem is
correctly diagnosed. I can only imagine the confusion and pain
that come with undiagnosed issues far more severe than the common
Fortunately, diagnostic issues may soon be a thing of the
past. Several publicly traded companies are currently making
great strides in the field of medical diagnostics, and my
favorite company right now in that arena is
TrovaGene (Nasdaq: TROV)
Not only is this company involved in revolutionary cancer
molecular monitoring diagnostics, but the technical picture has
"buy now" written all over it. Let's take a deeper look.
Diagnostic issues may soon be a thing of the
past. Several companies are currently making great
strides in the field of medical diagnostics, and my
favorite company right now in that arena is
TrovaGene's proprietary technology enables medical
professionals to analyze a patient's DNA to determine the best
course of colon cancer treatment. This is usually done with a
biopsy of the diseased areas, but TrovaGene is developing a
method that analyzes the patient's urine. Because its method
isn't invasive or painful, TrovaGene's approach could lead to
more people getting tested and therefore treated for cancer. The
company expects this technology to hit the market shortly. In
addition, TrovaGene's DNA/RNA diagnostics are used to monitor and
diagnose hereditary and infectious diseases.
TrovaGene isn't just a pie-in-the-sky theory. In March, the
company launched its urine-based human papillomavirus (HPV) test,
which screens for 15 high-risk strains of the papilloma virus. It
also expects the previously mentioned colon cancer technology, as
well as a test for mutations, to be launched by the end of the
In other bullish news, TrovaGene entered into a material
agreement with multibillion-dollar diagnostics technology leader
to jointly develop a test to determine a person's risk of
developing hepatocellular carcinoma (
). The terms have not been disclosed, but PerkinElmer will make
milestone payments to TrovaGene.
TrovaGene boasts a market cap of $125 million but has a tiny
revenue stream of just under an average $90,000 per quarter. The
vast majority of the revenue is from royalty agreements.
This company has substantial development costs, but I think it
will soon turn the corner to profits. PerkinElmer may be the
start of other large pharmaceuticals joining forces. In addition,
the market for the diversified pending products is huge with
TrovaGene, which is well positioned to capture it in stages as
the tests are approved and launched.
In the technical picture, shares have dropped from a high of
more than $10 to find support at the 200-day simple moving
average. As the bullish catalysts start to happen, the price
could easily bounce into the $15 range within the next 18 months.
Buying now with stops just below $6 and a 12-month target of $10
and an 18-month target of $15 creates a strong risk-to-reward
ratio for investors.
Risks to Consider:
Despite the potential, investors need to be fully aware that
this company is not yet profitable. Although it has enough cash
to survive awhile, it has a high burn rate and risks the
possibility of another company creating better products before
TrovaGene can exploit the market. This type of investment can
produce huge rewards, but it remains highly speculative at this
Action to Take -->
I think right now is the perfect time to buy into this diagnostic
company. The convergence of the pending diversified launches
combined with the technical picture creates a bullish environment
from the current level.
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