SOURCE: Generex Biotechnology

December 18, 2006 09:47 ET

Torc Investments and Research Reiterates Buy Rating for Generex Biotechnology 12-Month Price Target of $3.00-$3.50

TORONTO -- (MARKET WIRE) -- December 18, 2006 -- Generex Biotechnology Corporation (NASDAQ: GNBT) announced today that Torc Investments and Research LLC, a NASD-registered broker-dealer, reiterated its Buy rating on the Company today and 12-month price target of $3-$3.50.

In reiterating her Buy rating, Torc Director of Research Amanda McNamara, noted, "The Company is well on its way toward creating brand awareness for its main product-line that is centered on diabetes. Education and promotion are crucial as diabetes is a chronic disease where Type 2 diabetics (that represent roughly 90% of all cases) bear a lot of the responsibility of treating their disease. Generex Oral-lyn has been launched in Ecuador, a very crucial market since it serves as the first platform for the company to receive feedback about all aspects of the product. In just a short period of time, the marketing portion has progressed significantly as Generex Biotechnology Corporation is establishing relationships with worldwide Diabetes Associations to become the ambassadors of its products, which will play a large role in educating the consumer at limited costs to the company. This lead product is also ready to go into late-stage trials in Canada and potentially additional Latin American countries. Glucose RapidSpray is quickly penetrating the market since its introduction in August 2006, further strengthening brand awareness as it contributes to the company's top line."

The Report noted, "GNBT has a very strong balance sheet with nearly $49 million of cash and short-term investments as of October 31, 2006, providing GNBT with very sufficient working capital for the next three years if the burn rate were to remain the same. The reduction of interest expense to $257,000 versus $6.7 million for the same period a year ago is significant and should not be overlooked as it creates a huge value added for shareholders going forward. In addition to its strong diabetic product portfolio, GNBT's Antigen Express subsidiary continues to forge ahead with its impressive clinical advancement of its novel cancer and avian flu vaccines while representing a small part of the company's overall burn-rate. The subsidiary now has three vaccines either already being tested in humans or about to go into human trials that target large, potential markets."

The Report concluded, "Although the company has more than one product in its pipeline, we still continue to value the stock on its leading candidate Oral-lyn and continue to compare and discount Generex's market capitalization to MannKind Corp. since both companies target the alternative insulin delivery market and both are reliant on one main product to significantly drive sales. We believe a fair price target range for Generex Biotechnology Corporation over the next 12 months is $3.00 to $3.50... This range is less than half of MannKind's current market capitalization of $884 million but is not unreasonable due to the comparison of targeted markets. The company faces some risks that may prevent the achievement of our expected price range which include difficulty in receiving market approval in larger, more established markets or difficulty competing with larger companies with more cash reserves, but management continues to effectively implement its stated goals, which is good news for shareholders."

"Since Torc, an independent research firm, initiated coverage of the Company, Generex has made significant progress in developing its key products," said Anna Gluskin, President and Chief Executive Officer of Generex Biotechnology. "We remain highly focused on expanding the market for Generex Oral-Lyn, achieving key clinical objectives for Antigen Express and entering new markets with our Glucose RapidSpray product."

The entire report is available at

About Torc Investments and Research LLC

Torc Investments & Research LLC is a NASD-registered broker-dealer that offers a multitude of specialized services. The firm acts as an introducing broker to Merrill Lynch for hedge funds, institutional and high-net-worth retail accounts. It offers execution services through TradeSpeed technology which provides clients with direct market access with an emphasis on celerity. The company's research department provides in-depth, fundamental research analysis for equities with its core focus on the micro-cap and small-cap sector. Industry experience, coupled with superb technology and customer service, allow TORC Investments & Research to offer their clients advantageous and valuable resources in the financial sector.

About Generex

Generex is engaged in the research and development of drug delivery systems and technologies. Generex has developed a proprietary platform technology for the delivery of drugs into the human body through the oral cavity (with no deposit in the lungs). The Company's proprietary liquid formulations allow drugs typically administered by injection to be absorbed into the body by the lining of the inner mouth using the Company's proprietary RapidMist™ device. The Company's flagship product, oral insulin (Generex Oral-lyn™), which is available for sale in Ecuador for the treatment of patients with Type-1 and Type-2 diabetes, is in various stages of clinical trials around the world. For more information, visit the Generex Web site at

Safe Harbor Statement: This release and oral statements made from time to time by Generex representatives concerning the same subject matter may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by introductory words such as "expects," "plans," "intends," "believes," "will," "estimates," "forecasts," "projects" or words of similar meaning, and by the fact that they do not relate strictly to historical or current facts. Forward-looking statements frequently are used in discussing potential product applications, potential collaborations, product development activities, clinical studies, regulatory submissions and approvals, and similar operating matters. Many factors may cause actual results to differ from forward-looking statements, including inaccurate assumptions and a broad variety of risks and uncertainties, some of which are known and others of which are not. Known risks and uncertainties include those identified from time to time in the reports filed by Generex with the Securities and Exchange Commission, which should be considered together with any forward-looking statement. No forward-looking statement is a guarantee of future results or events, and one should avoid placing undue reliance on such statements. Generex cannot be sure when or if it will be permitted by regulatory agencies to undertake additional clinical trials or to commence any particular phase of clinical trials. Because of this, statements regarding the expected timing of clinical trials cannot be regarded as actual predictions of when Generex will obtain regulatory approval for any "phase" of clinical trials. Generex claims the protection of the safe harbor for forward-looking statements that is contained in the Private Securities Litigation Reform Act. Torc Investments and Research has received a fee of twenty-five thousand dollars for one year of research coverage of Generex.

Contact Information

  • Contact:
    Amanda McNamara
    Torc Investments & Research, LLC
    Phone: 212-897-7317