written by reader Seven Reasons to Be in Flex Pharma ($FLKS)

By DrKSSMDPhD, February 23, 2015

[Ed. Note: This bonus note is by Dr. KSS, who writes about medicine and biotech stocks for our Irregulars. As with all our contributors, he chooses his own topics, and his words and opinions are his own. He has agreed to our trade restrictions. Discussion of this topic will continue under Dr. KSS’s latest full article, “The Zed Files“. Enjoy!]

(1) Recently in the biotech threads, I examined $FLKS and was pretty disparaging. Using the critical utensils of biotech analysis, the company seemed heinously overvalued (present market capitalization about $250M), with murky science and no looming clinical trials. Increasingly it appears that $FLKS should not be assessed as a biotech play. It is a sports beverage play.

The company has a proprietary formula for a beverage for athletes that it has shown can limit or control muscle cramping associated with extreme exertion and recovery from that exertion. The drink is rumored to have extracts of ginger, capsicum and cinnamon, which may place it squarely into the”natural” and ”nutraceutical” camps, ever a hot area for US consumers. The company is now adjusting the taste of the beverage for maximum appeal and plans to launch it in early 2016.

Sales of carbonated beverages have been flattening for years, and beverage makers like Coca-Cola and Pepsi are hungry for new products and ideas. The FDA will view the beverage as a nutritional supplement, which slackens the exactitude for clinical proof needed to make advertising claims of muscle relaxation.

(2) Co-founder Roderick MacKinnnon, MD, is a Nobel laureate. His area of expertise is the potassium channel, widespread and in many varieties in nature. What’s special about potassium channels is that they have a way of letting through only potassium, and not sodium, this despite the fact that potassium atoms are quite larger than sodium atoms. How nature accomplishes this is what MacKinnon has studied throughout his career in the Howard Hughes Medical Institute.

MacKinnon’s work has also led into studies of neuromuscular regulation. An old theory was that muscle spasm owed to inappropriate autonomous muscle self-excitation. Flex Pharma has data, however, that muscle spasm, which can vex athletes, older people, those afflicted with multiple sclerosis and other neurological diseases, owes to inappropriate ”noisy” transmission inadvertently from the spine. MacKinnon has methodology that can quell these transmissions and this is invoked in the sports beverage. The company states it eventually aims to develop a prescription ...

This is a discussion topic or guest posting submitted by a Stock Gumshoe reader. The content has not been edited or reviewed by Stock Gumshoe, and any opinions expressed are those of the author alone.

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