The Bloom Is On This Wallflower

For a little-known small pharmaceutical company that's yet to make any money, Belmac has been a surprise winner recently. Its shares have jumped on the American Stock Exchange from 5 in mid-June to 8 5/8 on July 23--for no apparent reason. What's Belmac's secret?

"After 15 years of promises and delays, Belmac is finally making the transition from a development stage to a product-oriented and revenue-generating company," says Dennis Roth, an analyst at Chesapeake Securities Research in Towson, Md. He predicts that Belmac will be marketing two new-generation drugs shortly in Europe and in the U. S. by late 1992. One is called Biolid, a macrolide antibiotic for use against several common bacterial infections. The other drug is Alphanon, a transdermal treatment that Belmac says stops hemorrhoidal bleeding.

Roth estimates that Biolid and Alphanon will produce profits of $1.86 a share in fiscal 1993, based on projected sales of $64 million. Belmac has filed an application with the FDA to market Alphanon and Biolid in the U.S., and Roth expects approval in a year or so.

Mike Harshbarger, an analyst at HealthCare Capital Group in Chicago, estimates that Biolid alone, which was granted a European patent last month and is expected to be marketed in France in autumn, will generate sales of some $15 million in fiscal 1992, ending June 30. He expects Belmac still to be in the red in 1992 but sees Biolid's sales jumping to $30 million in 1993. "Biolid alone willproduce earnings of about $1 a share," he says.

One New York money manager says Belmac's prospects have prompted several U. S. and European financial groups to offer it equity investments, as well as joint ventures. One French company, he believes, will soon buy a 10% stake. Belmac declined comment.

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