Great Basin Scientific Inc (NASDAQ:GBSN) Making A Comeback

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The worst looks to be over for Great Basin Scientific Inc (NASDAQ:GBSN). GBSN received not just one, but two FDA approvals within one week. However, the 1-for-35 reverse split of its common stock overshadowed the FDA approvals. The company needed to do this to meet the minimum bid price requirement for its NASDAQ listing. It also allows institutions to buy the stock with the price over $1. In the long run, it's a positive and now GBSN needs to execute off its FDA approvals.

Great Basin Scientific is a molecular diagnostics company that commercializes breakthrough chip-based technologies. The company is dedicated to the development of simple, yet powerful, sample-to-result technology and products that provide fast, multiple-pathogen diagnoses of infectious diseases. The company's vision is to make molecular diagnostic testing so simple and cost-effective that every patient will be tested for every serious infection, reducing misdiagnoses and significantly limiting the spread of infectious disease.

GBSN received notification of clearance from the FDA on March 22, 2016. The company said that it “continues to execute against its menu expansion objectives, now providing the only FDA-cleared stand-alone molecular test to detect Shiga toxin-producing E. coli(STEC) and the serotype O157 directly from a patient specimen. The Shiga Toxin Direct Test can be run on the Great Basin Analyzer, which also performs Great Basin’s commercially available low-plex tests for Clostridium difficile (C. diff) and Group B Streptococcus (GBS), as well as the Company’s multi-plex Staph ID/R Blood Culture Panel, which is pending 510(k) clearance from the FDA.”

Great Basin’s value proposition is faster turnaround time and superior sensitivity compared to traditional methods. STEC are a leading cause of enteric bacterial infections in the U.S. Early detection can improve patient outcomes and avoid complications by ensuring that the proper antibiotic therapy is employed. The company’s Shiga Toxin Direct Test enables a streamlined workflow for laboratory technicians, offering sample-to-result testing with less than one minute of hands-on time, and without a specimen enrichment step. The test also identifies the serotype O157, a strain of E. coli linked to development of hemolytic uremic syndrome (HUS), a life-threatening condition.

GBSN received U.S. Food & Drug Administration (FDA) 510(k) clearance for its Staph ID/R Blood Culture Panel, following submission in August 2015. The company received notification of clearance from the FDA on March 25, 2016. This is Great Basin’s first multiplex panel to receive FDA clearance, adding to the value and versatility of the company’s analyzer, which is capable of performing low-plex, multiplex and direct-from-specimen assays.

Great Basin’s Staph ID/R Blood Culture Panel is a sample-to-result, automated, DNA multiplex assay for simultaneous identification of Staphylococcus aureus and Staphylococcus species directly from positive blood cultures in about 2 hours. The panel also detects the mecA gene, a major drug resistance marker that confers resistance to methicillin and other beta-lactams and creates the superbug MRSA. The assay workflow maintains Great Basin’s dedication to ease of use with less than one minute of hands-on time and no results interpretation due to the electronic results reporting.

The multiplex panel is run on the Great Basin Analyzer, which also performs the company’s commercially available low-plex tests for Clostridium difficile (C. diff) and Group B Streptococcus(GBS), as well as the company’s stand-alone molecular test for Shiga toxin-producing E. coli(STEC) detection.

On a pre-reverse split basis, GBSN closed at just $.205 per share. Shares had traded over $.30 per share on the news of the first FDA clearance and before the reverse split was announced. If shares return to those levels, we are looking at a move to $10.50 per share for 50% upside from current levels. While we feel for the pain of long-term shareholders, GBSN has proven to be a trader and a microcap runner and faller instead of an investment. We urge our subscribers and readers to trade accordingly. We will be updating Insider Financial as soon as we know more. For continuing coverage on GBSN, sign up for our free newsletter today and get our next hot stock pick!

Disclosure: We have no position in GBSN and have not been compensated for this article.