Calypte Biomedical Corp (fka CYPT)

[scion]

• We believe, however, that the single biggest product risk facing Calypte is the lack of a rapid test product. Although the Company has recently filed an IDE in the US for a rapid blood test, and expects to file an IDE for the rapid urine test, data submission and the review process typically takes from 12-24 months before US marketing approval.Although foreign market approvals may be secured on a shorter timeline, there are several rapid tests already on both the domestic and international markets. Calypte’s late entry in this category may prove to be a significant marketing challenge.

• Finally, Calypte historically has engaged in an unusually large number of financial transactions over a very short period of time. This has resulted in a highly complex capital structure, wide swings in the number of outstanding shares and large non-cash expenses and charges. During the third quarter, management acted to simplify the Company’s capital structure and thus stabilize the outstanding share count by negotiating the conversion of most of the Company’s convertible debt to equity. However, we anticipate there will be additional quarterly non-cash expense and compensation charges and variances in the outstanding shares for at least the next several quarters,thus making the Company’s financial position both on an absolute basis and a comparable peer basis difficult.

Some investors may shy away from Calypte due to these issues.


Sherry Grisewood, CFA
[e-mail]
Calypte Biomedical Corporation Report