Shares of the pharmaceutical company Biomed – Is it worth it?

The pharmaceutical industry is one of the sectors that can be without any doubt counted among the winners of the coronavirus pandemic. This is due to the virtually lightning-fast development of an effective and safe vaccine against SARS-CoV-2, as well as drugs against the Covid-19 coronavirus disease.
Among the relatively successful pharmaceutical companies is the Polish company Biomed-Lublin, which also made its mark in the wider world during the covid crisis.

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Biomed Lublin – introduction of the company

Biomed Lublin is a Polish pharmaceutical and now biotechnology company focused on the development, production and commercialization of highly innovative medicines. The company’s know-how is based on technologies developed by Biomed Lublin itself.
The history of one of the most important Polish pharmaceutical companies dates back to 1944, when it started its activity. At that time, however, under the umbrella of the National Institute of Hygiene in Lublin. Biomed is still based in this Polish city today. Among its first products were vaccines against typhus. Later they added vaccines against rabies, dysentery and polio.
Biomed Lublin coped well with the fall of the communist regime in Poland and continued to develop in the market economy. In 2011, it entered the Warsaw Stock Exchange’s secondary floor and became a publicly traded company. It then made its debut on the main market of the Warsaw Stock Exchange at the end of January 2015.

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Currently, Biomed Lublin focuses on the development of innovative drugs that find application in oncology or gynaecology. Biomed Lublin was also one of the first to develop a drug for covida. It contained a specific immunoglobulin derived from the blood plasma of patients already cured of covidu. The first batch of this drug was produced in September 2020.

Biomed shares and their latest development

Biomed Lublin’s shares have had a dull track record most of the time during its relatively short history. When Biomed went public 12 years ago, it was possible to buy one share for five zlotys. However, the market price of the shares started to fall and did not return to the subscription value until June 2020.
However, as soon as news of the successful development of a cowidium drug appeared in the media, the market value of Biomed Lubin began to skyrocket. Its shares traded at an all-time high at the turn of July and August 2020, just below the level of 25 zlotys. Compared to the underwriting value, therefore, at almost five times.

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With the gradual fading of the coronavirus pandemic, the boom of vaccines and anti-covid drugs from other, and it should be added established, companies such as Pfizer or Merck, the value of Biomed Lublin’s shares began to fall. Currently trading at just under six zlotys, Biomed Lublin’s market capitalisation is more than 380 million zlotys. However, year-on-year, the biotech company’s shares have appreciated by around 80 per cent.

 Biomed Lublin Wytwornia Surowic i Szc SA Shares (Source: Google.com)

Biomed shares – are they worth buying?

Biomed Lublin has shown relatively stable profitability over the last few years. Its net profit for last year exceeded six million zlotys, while sales exceeded 50 million. In the last week of April, Biomed Lublin announced that it has entered into an agreement with French pharmaceutical company Majorelle to cooperate in the registration, supply and distribution of Onko BCG 50 and Onko BCG 100 innovative oncology drugs in France and Monaco. The contract is for five years and has a value of nearly €15 million.

Biomed Lublin has repeatedly demonstrated its ability to establish itself in the market of biotechnology companies. The coronavirus pandemic, during which it became widely known to the professional public and investors, has helped it a lot. The signing of a lucrative contract with a French partner only underlines this ability of Biomed Lublin.

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Its prospects can thus be assessed positively and, given the relatively low market value of its shares, their purchase can be considered a decent investment opportunity. Of course, it is necessary to take into account the risks; after all, shares belong to assets that are sensitive to the current investor sentiment. The fact that biotechnologies are on the rise and are often sought after by large pharmaceutical companies as objects of potential acquisitions speaks in favour of investing in Biomed Lublin shares. As a rule, these are advantageous for shareholders of companies that are to come under the wing of a larger pharmaceutical group.

This article is also available in Polish on our partner’s website trader-magazine.com.