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I had the same hesitations until today. My conclusion? This stock has been overlooked, plainly and simply! Not a very sexy explanation but it is the only one I can think of. The final trigger for this conclusion come from an IIOnline article at:

Here is a quote; the interesting passage is in bold.

And little-known Genome Therapeutics (NASDAQ: GENE - Quotes, News, Boards) has built a subscription business based on bacterial genomes. The company's shares have risen more than 400% in the last few months on word that it would collaborate with American Home Products (NYSE: AHP - Quotes, News, Boards) on research targeting osteoporosis.

That deal could help Genome reap more than $100 million in revenue in the form of milestone payments and funded R&D. Genome also has an alliance with Schering-Plough (NYSE: SGP - Quotes, News, Boards) to treat asthma.

Steven Green of Ordinance Capital is especially bullish on the outlook for Genome Therapeutics. Even though the stock has had a strong run, he thinks investors still underestimate the value of its business model.

Unlike companies such as Human Genome and Celera Genomics, which are hastily mapping the entire DNA sequence, Genome Therapeutics is focusing on digging deeper, going after more useful details. “It makes for better science,” says Green.

“They have as good a chance to make it big as Human Genome Sciences, but they have a tenth of the market cap.,” he says. In addition to those above-cited alliances, Green expects the company to find a partner for its Princeton University-based tumor suppression program.

Green points out that the company has stayed off of Wall Street analysts' radar since it has a very healthy balance sheet and no need to raise cash. Genome Therapeutics recently brought in Richard Gill, who should serve as a more high profile leader. Gill used to be a senior executive with Bio-Tech General (NASDAQ: BTGC - Quotes, News, Boards), a profitable $600 million drug development company.
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