Dow Jones 10456.61 -115.94 11:24 am PST, November 19, 2004  NASDAQ 2074.54 -29.74 For info, visit access.smallcapnetwork.com S & P 500 1171.33 -12.22 Change your subscription status here Russell 2000 615.08 -6.98 VOLUME 04: ISSUE 93  Feature: Thermogenesis - Puts a Chill in your Blood. As mentioned on the SCBlog the other day, biotech Thermogenesis (NASDAQ: KOOL) showed up on my radar screen as an interesting company to profile. While the shares may be a bit pricey at the moment, as is the rest of the market, we have time to delve into this "cell therapy products derived from single donor blood" company. While we still see upside in the chart, retracing 40-50 percent of the recent run in September from under $4 to $5.80 currently would make us very happy. That means that there could be opportunities to buy this company back in the mid-$4 range, so if you like what you see, a small accumulation now and subsequent buys on dips seem the ticket.  We also feel the NASDAQ could shed a few points from these levels (near 2080) as well moving down closer to the 2020 level which may cheapen up some good names. Nasty little critters. Tainted blood could carry all manner of viruses including Creutzfeldt-Jakob Disease (CJD)--the nasty human manifestation of Mad Cow disease. One infected donor can potentially contaminate pooled plasma products which are derived from a large population of blood donors. KOOL, with its ability to quickly produce biological products from single units of blood, has become a leader in this technology--whether for customers using its BioArchive system for umbilical blood banks or CryoSeal to prepare hemostatic and surgical sealants from patient blood. These biological products may include hematopoietic stem cells for bone marrow rescue transplants and blood-derived proteins to assist surgeons in arresting bleeding or gluing tissues. From the numbers, it appears the company has progressed well. Current market cap is large at $262 million. Cash on hand equals about $16 million, but there is minimal debt. Q1 2005 revenues increased 12 percent to $2.4 million over Q1 2004. For fiscal 2004 net revenues topped $11.6 million. Historically, or at least since 1992, the company has been a leading supplier of state-of-the-art Ultra-Rapid Blood Plasma Freezers and Thawers to hospitals and blood banks. The company is heavily involved in R&D and various clinical trials to validate its products. Operations in Europe and the Middle East are being expanded as, interestingly; a portion of the company's products is available only in those jurisdictions. I'm not afraid to admit it... I have to admit, I like medical device companies for a few reasons. First, they tend to expand already accepted therapies or efficacies and make them more useful and accessible to patients and doctors. Two, the demographic is aging and companies that are developing the next generation of products are always compelling. Three, and this is just personal, I'm all for procedures and products that help and protect patients and those really smart folks that care for them. I won't pretend to be a medical device expert. I will state that I do believe that this is biological rocket science. Thermogenesis is undoubtedly on the cutting edge of new and safer blood storage, therapeutic extraction and plasma safety, whether it's for hemophiliacs or for bone marrow rescue transplants. The company has characterized its involvement in the stem cell sector thusly: With the ethical debate surrounding the embryonic stem cell research market and the decision by President Bush to set aside $250 million to fund research on alternative sources of stem cells to embryonic stem cells, the Company has accelerated its efforts to acquire additional cell selection, cell expansion and cell modification technology to increase the economic and therapeutic value of a BioArchive cord blood stem cell inventory in future years. I'll be back... And since the company is headquartered in California, the recent Prop 71 to allow the state to spend $3 billion over 10 years on stem cell research should bode well for the future of KOOL, its technology and its shareholders. As I mentioned previously, those interested in establishing exposure to this niche--for now--sector would likely be prudent to accumulate a bit of KOOL now and more on dips should they occur. At Kool's stage of development it is difficult to get a firm handle on a timeline, but for the reasons noted, it looks a good spec for risk-oriented investors.     We Value Your Feedback Got comments, questions or suggestions? Send 'em on over: Editor@smallcapnetwork.com If you wish to send a written request or inquiry, please send it to our physical address: TGR Group, LLC 3525 Del Mar Heights Rd #334 San Diego, CA 92130 Unsubscribe Here D I S C L A I M E R: The SmallCap Digest is an independent electronic publication committed to providing our readers with factual information on selected  publicly traded companies. SmallCap Digest is not a licensed investment professional or broker-dealer. 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