Cytosorbents Corp (CTSO) warrants an analyst rating of 'Buy', according to Brean Murray who initiated coverage this week on CTSO as the company undertakes the commercial launch of its potentially breakthrough blood purification product, CytoSorb. Cytosorb shars were up by over twelve percent on Tuesday following the announcement of the new coverage.
Cytosorbents has consistently been building momentum for its potentially breakthrough treatment for severe sepsis and other indications of high cytokines and the productis already approved in Europe for those unmet medical needs. CytoSorb was formally launched onto the commercial market in Germany recently and is slowly and methodically building a customer base of firm believers in the technology. Given that the company is small in size and resources are limited, CEO Chan has taken a methodical approach in rolling out the launch, but should CytoSorb demonstrate the commercial successes that were proven in trials, the potential for growth is unlimited as there is currently no effective treatment on the market to combat severe sepsis and indications where high cytokines are present.
With that being the case, the product is currently going through a period of "I'll believe it when I see it" with medical professionals. While European authorities were compelled to approve CytoSorb before the European trial was even completed, based on the encouraging results, many still want to see results from a larger trial - or commercial success stories - before giving CytoSorb widespread acceptance.
Cytosorbents is currently in preparations to conduct a larger trial in the United States, with FDA approval as the ultimate goal.
Given the potential of this company's blood purification technology, CTSO shares could be heavily discounted right now, based on the potential of the product. As events develop, it's likely that the company will eventually seek to trade on a larger exchange, a move that would allow for a more committed investor base. Many investors shy away from OTC stocks altogether, while many others only consider such companies as speculative 'trading plays.'
The new analyst coverage, however, for a smaller company could be viewed as a significant event. As more interest is drawn to this company and its technology, the possibilities of growth could increase. Often a nice play for the trading opportunites, there's reason to believe this one could be a very solid long term winner, too.
Another hot one to watch.
Disclosure: Long CTSO.
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