With today’s Americans becoming larger and larger, it seems that many are beginning to take various medication for their obesity caused afflictions.
Many go to paranormals to seek traditional healing to treat their diseases, while others take traditional drugs, including herbal medicines, to cure their pain. The better off still visit hospitals or doctors and can afford expensive conventional drugs.
But many are trying the herbal medicines. From weight loss pills to brain stimulators, the number of applications these medications have supposedly is endless. There are even herbal remedies for HIV and cancer. But in most cases, these companies stick to just a few relevant purposes that attract the most interest. Sports supplements, type II diabetes, and weight loss are the commonalities these companies possess.
There are a number of small cap names that are involved in this area, and many have performed very well over the last few weeks. Pacific Health Laboratories Inc. (OTCBB: PHLI), GeoPharma Inc. (Nasdaq: GORX), Natrol Inc. (Nasdaq: NTOL), Integrated BioPharma Inc (Nasdaq: INBP), Bactolac Pharmaceuticals Inc. (Pink Sheets: BTCP), Schiff Nutrition International Inc. (NYSE: WNI), Cyanotech Corporation (Nasdaq: CYAN), Nutracea (OTCBB: NTRZ), and Nutrition 21 Inc. (Nasdaq: NXXI) are just a few of the companies involved in this sector.
One company that is also involved in this arena though across the Pacific is American Oriental Bioengineering Inc. (NYSE: AOB). The company is engaged in the development and production of pharmaceutical and health supplemental products and traditional Chinese medicinal products that combine modern bio-technology and traditional Chinese medical technology. The company’s series of products are marketed in China. Some of the products include: Soybean Peptide, MilkPeptide, PancreaMate, SoyPeptide Powder, SoyChew Peptide, Biyanling Tablet and others.
The company recently reported first quarter earnings that displayed some impressive growth. The bottom line number came in at 10 cents vs. 8 cents on revenue of $25.7 million vs. $19.1 million. This increase reflects $6.4 million in revenue from the company’s Jinji product portfolio, as well as year over year growth in the company’s core Plant-based Pharmaceutical (PBP) and Plant-based Nutraceutical (PBN) products. Revenue from PBP products increased 52.4 percent to $18.6 million from $12.2 million in the prior year’s first quarter, driven primarily by the Jinji products series, including the company’s newly launched Yi Mu Cao product for the relief of pre-menstrual symptoms, and by the Cease Enuresis Patch. Revenue from PBN products increased 3.7 percent to $7.2 million from $6.9 million from the first quarter of 2006, due to increased demand for the company’s soy peptide products.
Commenting on the first quarter of 2007, Tony Liu, Chairman and CEO of AOB, said, “We are pleased to report another quarter of continued growth in our business. Our major plant-based pharmaceutical and nutraceutical categories contributed to our revenue growth in the first quarter with the biggest contribution coming from our over the counter (OTC) products. Our newly launched Jinji Yi Mu Cau product contributed to our results in the quarter and we are satisfied with the momentum of this product as we move into the second quarter.”
In any event, with many quality products (though they certainly do not sound very enticing to Americans) and a market place the size of China, investors must realize that this name has the ability to become the next USANA Health Sciences Inc. (Nasdaq: USNA). With continued expansion of sales in the Chinese market, the name could warrant some serious consideration.