Small cap stocks Derma Sciences Inc (NASDAQ: DSCI), Oculus Innovative Sciences, Inc (NASDAQ: OCLS) and Arch Therapeutics Inc (OTCBB: ARTH) specialize or have a focus on wound care – a medical problem that has plagued mankind since the dawn of time. After all and think back to our Civil War when disease along with infections resulting from improper wound care probably killed more soldiers than actual battles. Even today, infection after surgery or after receiving a wound or injury of any kind is still a constant threat. And then there is the scaring that can result from any sort of invasive surgery or injury. With those thoughts in mind, here are three small cap wound care stocks trying address these problems:
Derma Sciences Inc. A specialty medical device / pharmaceutical company focused on wound care, small cap Derma Sciences is a fully integrated manufacturer, marketer and supplier of a complete line of products for wound and skin care in the following categories: Advanced Wound Care, Traditional Wound Care, Burn Care, Skin Care and Bathing, Specialty Securement and Closure Devices, and First Aid. The company has two wholly owned and operated manufacturing facilities in Toronto and China plus it offers contract manufacturing services for OEM or private label products. Back in early June, Derma Sciences reported positive results from a Phase 1 diabetic foot ulcer study. Otherwise and back in May, Derma Sciences reported that revenue rose to $18.8 million from $15.3 million while its net loss grew from $2.5 million to $6.3 million year over year as sales of traditional and advanced wound care products improved, but the company spent more to promote its advanced wound care products while research costs grew because it started treating patients in two late-stage trials of a treatment for diabetic foot ulcers. On Wednesday, Derma Sciences rose 7.22% on unusually high trading volume to $15 (DSCI has a 52 week trading range of $9.10 to $15.45 a share) for a market cap of $254.65 million plus the stock is up 39.5% since the start of the year, up 50.7% over the past year and up 158.6% over the past five years.
Oculus Innovative Sciences, Inc. A global healthcare company that designs, manufactures and markets prescription and non-prescription products in over 20 countries, small cap Oculus Innovative Sciences has over 100 SKUs commercialized worldwide that are used to treat patients in surgical/advanced wound management, dermatology, women's health and animal health. Back in June, Oculus Innovative Sciences reported $15.5 million in revenue for the twelve months ended March 31, 2013 verses $12.7 million for the same period in the prior year while the company's operating loss minus non-cash expenses (EBITDAS) was $1.5 million verses $3.3 million. However, the Oculus Innovative Sciences is focused on an intended IPO for subsidiary Ruthigen, Inc, but the number of shares to be offered and the price range for the offering have not yet been determined. According to the plan, Oculus Innovative Sciences will retain all Microcyn drug and device indications while Ruthigen will focus on RUT58-60, a drug candidate intended for the prevention of infection in trauma and surgical procedures that still needs more funding. Oculus Innovative Sciences itself is aiming to reduce its operating expenses while targeting EBITDAS breakeven with the spinoff. On Wednesday, Oculus Innovative Sciences rose 0.37% to $2.68 (OCLS has a 52 week trading range of $2.34 to $7.00 a share) for a market cap of $14.31 million plus the stock is down 37.3% since the start of the year, down 48.3% over the past year and down 85.9% over the past five years.
Arch Therapeutics Inc. A medical device company, small cap Arch Therapeutics offers an innovative and superior approach to the rapid cessation of bleeding (hemostasis) and control of fluid leakage (sealant) during surgery and trauma care – meaning its value proposition is based on the premise of faster and safer surgery. In addition, Arch Therapeutics has noted on its website that last year, the global market for hemostatic agents saw over $2.8 billion in sales and nearly $1.3 billion in sales for fibrin and other sealants. All told, combined sales of over $7 billion are predicted in 2017. As for Arch Therapeutics' product, its AC5™ is a synthetic peptide comprising of naturally occurring amino acids that stops bleeding promptly when its squirted or sprayed onto a wound. Moreover and unlike many competitive products, AC5™ conforms to irregular wound geometry to allow for normal healing plus it helps to maintain a clear field of vision. However and while Arch Therapeutics' products are not yet in human clinical trials, the company is progressing in preclinical development. On Wednesday, Arch Therapeutics rose 5.66% to $0.560 for a market cap of $24.6 million.
The Bottom Line. If you have overlooked wound care as an area to invest in, you may want to take a closer look at small cap wound care stocks like Derma Sciences Inc, Oculus Innovative Sciences and Arch Therapeutics.
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