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Rafarma Pharmaceuticals Inc. (RAFA)

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Last Post: 11/24/2020 1:18:45 PM - Followers: 99 - Board type: Free - Posts Today: 3

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Merged has closed!:

Reverse Merger of Biocogency into Rafarma Pharmaceuticals Creates Substantial Unrealized Shareholder Value:

Biocogency with $73 million 2019 sales recently acquired majority control and merged all operations into Rafarma Pharmaceuticals

There was no dilution to Rafarma shareholders and all operations and assets of both companies will be combined and reported under the ticker RAFA

The merger increased Rafarma Pharmaceuticals 2019 revenues from $11.4 million to $84 million

Elite accounting firm, L. J. Soldinger is retained to perform audited financials

Wealthy international industrialist, Ilya Shpurov is now Chairman of the Board of Rafarma Pharmaceuticals

  • With 2019 combined sales of $84 million, current market cap of $131 million, extraordinary strong growth, and share price of $1.69, market comps point to share price valuation several multiples higher than current price

Many OTC stocks are easily overlooked because they don't get the coverage of peers traded on national exchanges and consequently very few investors have the opportunity to know about them. A perfect example is the recent closing of a reverse merger increasing sales by over 700% and adding sizable international operations of private Biocogency into Rafarma Pharmaceuticals (OTC: RAFA) where the RAFA share price has not yet reflected the new added value.


On October 19, 2020, the merger of Biocogency into Rafarma was announced and went unnoticed. Although important metrics to determine share valuations have soared as a result of the merger, the share price has not yet caught up reflecting the new increased valuations simply because nobody knows about it yet. As word is likely to spread soon, the share price is expected to begin climbing to more fair and reasonable market valuations that could exceed expectations.


About Rafarma Pharmaceuticals

Rafarma Pharmaceuticals, Inc., a multi-product pharmaceutical company, produces and sells cannabis health-related products and specialty pharmaceuticals. The company formerly known as Johnston Acquisition Corp. changed its name to Rafarma Pharmaceuticals, Inc. and is based in Sandy, Utah with a manufacturing and distribution facility in Russia.

About Biocogency

Biocogency owns PJSC "Krasfarma", the largest Russian chemical and pharmaceutical production company with more than 50 years of experience in the production of drugs that meet all national and international quality standards.

The Company helps meet the growing needs of health care for high-quality, effective and safe generic pharmaceuticals as well as development and production of innovative pharmaceutical products. Production systems with a strong emphasis on safety are carried out through a coordinated interaction of their quality control department, commercial department, logistics service, and scientific information department and pharmacovigilance services.

A rich history is not the most important thing in the modern pharmaceutical industry. To keep the quality of products on a permanently high level, a program of production modernization is being realized: investments in the company include new industrial lines, engineering systems and control systems, as well as new pharmaceutical products.

Safe and effective generic medicines of PJSC "Kraspharma", which are not inferior in clinical efficacy to the original, but sold at affordable prices, have won the trust of both doctors and patients.

Today PJSC "Kraspharma" is the Eastern Europe and Russia undisputed leader in the production of:

  • Antibiotics;
    tuberculosis drugs in injectable forms;
    Blood substitutes;
    infusion solutions;
    Preparations of other pharmacological groups.

Most of the drugs produced are included in Vital and Essential Drugs List (VED) approved by the Government of the Russian Federation.

The products of PJSC "Kraspharma" are sold in Russia, Eastern Europe, Central Asia and in the countries of the Asia-Pacific region.

What Biocogency Adds to Rafarma


This transformative merger starts by restating Rafarma 2019 sales from $11.4 million to $84 million and delivers impressive growth rates of close to 50%.


The Biocogency group includes Russia-based drug companies Bebig and PJSC Kraspharma and industrial firm Slavich. Bebig is focused on developing therapies and diagnostics for cancer care in the Russian markets, including supplying microsources for the treatment of prostate cancer using low-dose brachytherapy. Kraspharma, Russia's largest chemical and pharmaceutical production company (and crown jewel of the merger), and Slavich, a manufacturer of a variety of products including packaging goods, materials for microelectronics and photo materials, are both steeped in corporate history going back half a century or more in Russia.


Biocogency also brings leadership committed to growing value as measured by the fact the deal was structured to be non-dilutive to existing RAFA shareholders. To that point, Ilia Shpurov has assumed the position of Chairman of the Board, bringing decades of entrepreneurial – and biotech – success to RAFA.


What's in it for RAFA? An Immediate Spike in Revenue and Profits


The merger with Biocogency is a game changer for RAFA operations and the top and bottom lines. Consider that in 2019, RAFA generated revenue of approximately $11.4 million and gross profit of $3.4 million. In the latest quarter, ended July 31, 2020, Rafarma reported revenue of $5.3 million and gross profit of $3.1 million, according to filings with OTC Markets Group.


Those results are going to get an immediate shot of adrenaline.


During fiscal 2019, the Biocogency group reported unaudited consolidated earnings of $73 million and gross profits of $17 million. As a course of becoming fully reporting and planning to uplist, the financial results are being audited and adjusted to meet GAAP standards.


Using the results from 2019, it is easy to extrapolate pro forma revenue of $84.4 million and gross profit of $20.3 million for the combined company. It is those type of financials that will underpin a move to the Nasdaq or NYSE.


More on how the price to sales ratio stacks up to industry comps are discussed here. Several Pharmaceutical market comps point to Rafarma share prices that are many multiples higher than the current price of $1.69.


When it comes to value, it certainly bears mentioning the investments that Biocogency has put into its pipeline and platforms since 2012, which management pegs at more than $120.0 million. Much of this investment has been directed by Shpurov since he bought the Kraspharma during the outbreak of the global financial collapse in 2008 for the purpose of restoring and expanding production volumes post-recession while establishing a high-tech GMP pharmaceutical manufacturer in Krasnoyarsk.


That was accomplished. Today, Kraspharma is a leading producer of wide swath of generic drugs and pharma products spanning antibiotics, blood substitutes, infusion solutions, tuberculosis and preparations for other pharmacological groups. Sales channels extend throughout Russia, Eastern Europe and the Asia-Pacific region.


Widening the Footprint


The plan is for vertical growth by expanding the existing channels while leveraging RAFA relationships for horizontal growth through entering the lucrative North American markets.


In fairness, Russia alone can be a company maker. A huge net importer of medicine, the Russian government is pushing for national security in the supply chain as outlined in the Pharma 2030 Strategy. With that in mind, Statista forecasts the Russian pharmaceutical industry will grow 147% between 2017 and 2030.


During Q1, the Russian pharma market surged 125% year-over-year to about 320 billion Russian rubles (US$4.2 billion). Generic drugs typically dominate the prescription market, accounting for 64.5% of the category in 2017, meaning Kraspharma is in a strong position.


Given the sheer volume of people, Asia is another tremendous market. The Rx market in China alone is forecast to reach $160 billion by 2022, highlighting the market opportunity. With respect to the Asian drug development market, ResearchAndMarkets estimates 6.54% compound annual growth to reach $62.46 billion by 2026.


Still, the U.S. is the Holy Grail as the biggest pharmaceutical market in the world, weighing in at a whopping $484.4 billion in 2018.



With the reverse merger now closed, the newly created Rafarma Pharmaceuticals that now boasts fast-growing operations well in excess of $100 million for 2019 is decidedly undervalued when compared to industry valuations for similar companies. Management plans for uplisting and higher investor awareness programs are soon in the future which will help bring the Rafarma opportunity to the forefront resulting in substantially higher prices and trading volume.

The current price has not yet appreciated to reflect the newly increased sales and valuations and therefore presents an opportunity to astute investors who act now before the story becomes more commonly known.


The asia hemp market will be huge!

This analyst explains the company well:
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RAFA News: Reverse Merger of Biocogency into Rafarma Pharmaceuticals Creates Substantial Unrealized Shareholder Value 11/17/2020 10:56:59 AM
RAFA News: Imminent Reverse Merger Brings Windfall To Rafarma Pharmaceuticals Shareholders - RAFA Shares Could Surprise Big 09/28/2020 08:30:00 AM
#5275  Sticky Note GREAT UPDATE TODAY! The merger increased Rafarma TopKnotchTrades 11/17/20 11:39:44 AM
#5190  Sticky Note more birdman- honest report from the court snakess 10/26/20 10:09:12 PM
#5307   I would not doubt that at all !!!!!!!!! IB_ 11/24/20 01:18:45 PM
#5306   Bird man. he's probably the one unloading. Truth Dig It 11/24/20 01:10:01 PM
#5305   When will RAFA be over $3.00 ?????????????????????????????? IB_ 11/24/20 09:11:43 AM
#5304   thats not support. thats the birdman or his reverse_long 11/20/20 01:46:00 PM
#5303   RAFA looking nice a RED yet again today !!!!!!!!!!!!!!!!! IB_ 11/20/20 11:25:27 AM
#5302   ALOT higher than the .20 I paid for Supersonics 11/20/20 11:17:59 AM
#5301  Restored RAFA "may" turn out to be ok but IB_ 11/20/20 09:16:30 AM
#5300   https://seekingalpha.com/instablog/21922151-bioresearch-alert/5522417-reverse-me madtrader2132 11/20/20 09:07:14 AM
#5299   Looks great to me. Support holding firm as ScottRVA1 11/20/20 08:13:23 AM
#5298   WoW, RAFA looks dead !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! IB_ 11/20/20 12:16:12 AM
#5297   How is RAFA's share price looking ???????????????????????????? IB_ 11/20/20 12:14:03 AM
#5296   any order of 10k+ sells can get this reverse_long 11/19/20 06:48:27 PM
#5295   She held $1.55 again. I picked-up another 1k. :) ScottRVA1 11/19/20 02:35:20 PM
#5294   YEEET Tradeit1time 11/18/20 09:57:28 PM
#5293   LOl, you have it confused. i shorted the reverse_long 11/18/20 07:15:50 PM
#5291   Re the 2 merger updates today :) , ScottRVA1 11/18/20 12:52:46 PM
#5290   That makes over 2000 employees now if you TopKnotchTrades 11/18/20 12:52:21 PM
#5289   LOL be careful! RAFA dropped to 1.41 a reverse_long 11/18/20 12:05:47 PM
#5288   I’ll guess uplisting to be late Q1 if ScottRVA1 11/18/20 11:52:07 AM
#5287   Do you have an idea of when they Stallion4life38 11/18/20 11:42:34 AM
#5286   $RAFA Rafarma Pharmaceuticals welcomes SLAVICH TopKnotchTrades 11/18/20 10:59:52 AM
#5285   $RAFA - Rafarma Pharmaceuticals welcomes BEBIG per our TopKnotchTrades 11/18/20 10:57:45 AM
#5284   IMHO you have not missed anything yet at PEACHMAN 11/17/20 09:19:23 PM
#5283   Right on man, thanks for that! Stallion4life38 11/17/20 04:22:42 PM
#5282   Damn!! Just missed it then. What was the Stallion4life38 11/17/20 04:19:11 PM
#5281   Updated TopKnotchTrades 11/17/20 01:49:26 PM
#5280   Mods please update ibox with this great news. MG123 11/17/20 01:44:38 PM
#5279   The merger increased Rafarma Pharmaceuticals 2019 revenues from MG123 11/17/20 01:36:23 PM
#5278   Awesome update! MG123 11/17/20 01:33:55 PM
#5277   Merger Has Already Closed. TopKnotchTrades 11/17/20 01:06:04 PM
#5276   When is the merger suppose to happen? Stallion4life38 11/17/20 12:12:52 PM
#5275   GREAT UPDATE TODAY! The merger increased Rafarma TopKnotchTrades 11/17/20 11:39:44 AM
#5274   Someone delete my post? dr_praeses 11/17/20 10:00:40 AM
#5273   Everything about RAFA looks good but it's on SHEEPWOLF 11/17/20 08:41:49 AM
#5271   IMHO adding RAFA a smart move over the PEACHMAN 11/12/20 09:03:28 AM
#5270   Adding madtrader2132 11/11/20 11:15:25 PM
#5268   Adding madtrader2132 11/11/20 03:06:34 PM
#5267   RAFA acting like a winner lately. Tradeit1time 11/11/20 02:23:30 PM
#5266   ... meanwhile dump PRED and buy RAFA Tradeit1time 11/11/20 02:17:23 PM
#5264   Yea, great chance to sell off LOL. Wait reverse_long 11/09/20 09:43:00 PM
#5263   Great News on RAFA. PEACHMAN 11/09/20 10:29:15 AM
#5262   Big Rafa News! TopKnotchTrades 11/09/20 09:20:25 AM
#5261   Update from the CEO with reduced share count speedo94947 11/09/20 09:20:18 AM
#5260   READ MY LIPS. reverse_long 11/08/20 07:58:08 PM
#5255   RAFA hanging on to dear life here... that reverse_long 11/07/20 06:17:32 PM
#5253   RAFA is a dying stock and The Old IB_ 11/06/20 03:30:02 PM
#5252   RAFA is toast like all of the Old IB_ 11/06/20 03:28:11 PM
#5251   Double top around 2 1/2; now headed to......zero-ish? Tokugawa 11/06/20 01:56:57 PM
#5249   RAFA is trending downward !!!!!!!!!!!!!!!!!!!!!! IB_ 11/06/20 10:56:40 AM
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