Why NeoStem, Inc. Shares Popped

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of NeoStem, Inc. closed the trading day with a gain of roughly 9% after peaking in the morning at a 10% pop. The small biotech company is enjoying a wave of positive sentiment after announcing that it has been granted two new patents for its CD34 cell program.

So what: NeoStem's patents cover "Compositions and Methods of Vascular Injury Repair," according to the company's press release, and will protect a broader range of serum concentrations for CD34 cell delivery than did earlier patents. CD34, which is developing treatments for ischemia (a restriction of oxygenated blood) now boasts 16 patents, and the latest two cover AMR-001, which is the most promising treatment in the CD34 program. AMR-001 is a stem cell product derived from bone marrow that is designed to increase blood flow by aiding the development of new blood vessels, and its Phase 2 study wrapped up at the end of last year, with full data expected in the latter half of 2014.

Now what: NeoStem investors have been waiting years to see genuine good news about its pipeline, and the lack of such news has contributed to a 10-year loss of 94%, and a five-year loss of 63%, of the stock's value. A couple of patents aren't much to cheer, especially when they cover a treatment that hasn't begun phase 3 trials yet -- it's standard practice in the industry to patent newly developed treatments, and such events matter far less than the treatment's eventual approval. I wouldn't read anything into today's patent news -- Neostem is the same company today that it was yesterday, except with two more patents in its hands.

Will this stock be your next multi-bagger?
Give me five minutes and I'll show how you could own the best stock for 2014. Every year, The Motley Fool's chief investment officer hand-picks 1 stock with outstanding potential. But it's not just any run-of-the-mill company. It's a stock perfectly positioned to cash in on one of the upcoming year's most lucrative trends. Last year his pick skyrocketed 134%. And previous top picks have gained upwards of 908%, 1,252% and 1,303% over the subsequent years! Believe me, you don't want to miss what could be his biggest winner yet! Just click here to download your free copy of "The Motley Fool's Top Stock for 2014" today.

The article Why NeoStem, Inc. Shares Popped originally appeared on Fool.com.

Alex Planes has no position in any stocks mentioned, and neither does The Motley Fool. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2014 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story