Source: Roger Yu , The Dallas Morning News
Positive test results, revenues boost investor optimism
Optimism over its developing drug injection technology and a return to profitability are sending shares of Carrington Laboratories Inc. to new highs.
The Irving-based biomedical research company saw its shares jump nearly 13 percent Wednesday even though it released no formal news. They rose 59 cents to finish at $5.29, a 52-week high. That's a far cry from $1.60, where the stock was trading as recently as May 27.
Chief financial officer Robert Schnitzius said the company has "two types of investors looking at us" – ones interested in its nascent research and development efforts and others keen on the revenue of its more established products.
Last week, Carrington announced that animal testing of its injection technology rendered favorable results. The company is aiming to develop a method in which a liquid medicine can be injected and become gelatinous once it comes into contact with the body's cellular fluids.
Certain types of medicines are best distributed over a period of time, rather than all at once. And injecting in the gelatinous format is an effective distribution method for such drugs, Mr. Schnitzius said.
The tests showed that the injected substance was distributed in a period of seven days and the polymer that becomes the gel substance was absorbed into the body after delivery, he said. "People are starting to get interested in drug delivery technology," he said.
Still, the company has a long way to go before commercializing the product. The animal testing phase precedes Phase I of the Food and Drug Administration approval process, which requires three rigorous testing phases.
For the quarter ended June 30, Carrington's revenue rose 83 percent to $7.96 million, largely due to increased sales at its Caraloe Inc. division that sells aloe vera related raw materials and other cosmetic products. Caraloe's revenue skyrocketed 181.2 percent in the second quarter. Carrington posted net income of $339,000 in the quarter, compared with a net loss of $858,000 a year ago.