Biospherics Inc.'s temporary rise to glory has focused attentiononce again on potential competitors to Nutrasweet, whichcomes off patent in December 1992.
Beltsville, Md.-based Biospherics (NASDAQ: BINC) closedTuesday at $9 a share after a week of trading in which itrocketed from $4 to close at $23.25 last Friday. Enthusiasticinvestors flocked to the stock on news that the company hadobtained a patent covering the production of the sugarsubstitute D-tagatose. D-tagatose, a galactose sugar derivative,reportedly does not cause weight gain in animals and, unlikeNutrasweet, can be used in baking.
Biospherics began tumbling Monday after a Barron's articlepointed out that the price for tagatose ($1.60 per pound) is notcompetitive, that the product has a long regulatory road aheadof it, and that several competitors are aiming at the $1 billionNutrasweet (aspartame) market.
Monsanto spokesman Richard Nelson on Tuesday said thecompany expects Nutrasweet to remain the most widely soldalternative sweetener throughout the decade. If anything canreplace Nutrasweet, it will be Monsanto's Sweetener 2000, headded.
Sweetener 2000, currently in safety testing, can be producedfor less than 1 cent per pound equivalent, said Nelson. This willchange the economics of sugar production, he predicted. Theworldwide price for sugar is 5 cents per pound. Sweetener2000 also can be used in baked goods.
Cowen & Co. analyst David Stone said the Biosphericsphenomenon was created by individual and institutionalinvestors who are trying to find the next Amgen Inc. while it isstill is valued at $6 a share. He said the most popularcompanies are those with low-priced stocks and that areperceived to be developing "big deal" products such as sugarsubstitutes or AIDS drugs.
For example, said Stone, Agouron Pharmaceuticals Inc.'s stockdoubled over a report that it found the crystal structure of aportion of an AIDS viral protein even though the company is along way from having an AIDS drug.
-- Carol Talkington Verser, Ph.D. Special to BioWorld
(c) 1997 American Health Consultants. All rights reserved.