Aethlon Medical, Inc. (OTCBB:AEMD) Surges To New 52 week High

AEMDchart.pngAethlon Medical, Inc. (OTCBB:AEMD) has been doing great since August started. The company has been gathering momentum and posting better and better results for five consecutive sessions. Yesterday the company rose by 41% and closed at $0.26 just shy of its HOD. Interest in the stock has also been increasing culminating in the near record traded volume of 2.8 million shares. AEMD hasn’t been able to revisit such high price levels since the start of 2011.

The medical company has a lot going on for them. They have a 5 year contract with The Defense Advanced Research Projects Agency (DARPA) for the creation of device that will reduce the occurrence of sepsis in soldiers injured during combat. Because of this contract AEMD have been able to generate revenues putting them ahead of the majority of other pennystock medical companies.

Also in July they were granted another contract by DARPA this time as part of the team consisting of AEDM, Battelle and NxStage Medical (NASDAQ:NXTM). Under the terms of the agreement it could run for as long as four years and reach $22.8 million.

A month earlier they received approval from the FDA to start human studies of the Aethlon Hemopurifier, their other product used to prevent life-threatening infections from circulation.

But looking at their fundamentals reveals some serious concerns. In the 10-K for the financial 2013 AEMD disclosed the following results:

  • $125 thousand cash
  • $364 thousand total current assets
  • $9.6 million total current liabilities
  • $1.2 million revenues
  • $4.8 million net loss

The working capital deficiency is getting almost to unmanageable levels and the accumulated deficit is above $61 million. But a much more pressing issue are all the overdue promissory notes in the amount of $2.2 million. AEMD are even undergoing a court trial filed by Gemini Master Fund, Ltd. They are alleging that the company is in default of a promissory note from 2010 and are seeking money damages and delivery of common shares.

SNTIchart.pngShareholders of AEMD are also threatened by massive dilution due to outstanding options and warrants for 96 million shares at a average price of $0.15 per share. Another 42 million shares could be issued for just $0.06 because of the numerous convertible notes. If all of them get exercised it will nearly double the currently outstanding 173 million shares. 

Another biotechnological company had a great session yesterday. Senesco Technologies, Inc. (OTCMKTS:SNTI) added 59% in value and are currently at $0.04.Today though things are not looking so good and in early trading SNTI are 20% down. OncoSec Medical Inc (OTCMKTS:ONCS) had a much more modest gain of 3% but the traded volume of 6.6 million shares was quite impressive.

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