Opinion on  Vasogen Inc. (VSGN)     Sector: Healthcare  >  Industry: Medical Equipment & Supplies
VSGN is a buy

Rodman & Renshaw, LLC Announces Investment Opinion: Rodman & Renshaw, LLC Initiates Coverage of Vasogen Inc. With A Market Outperform Rating <o:p> </o:p>

2007-02-27 08:40 ET - News Release

Analyst Sets 12 Month Target Price of $3

NEW YORK -- (Business Wire)

Rodman & Renshaw, LLC initiated research coverage of Vasogen Inc. (NASD: VSGN) with a Market Outperform Rating and a 12-month price target $3. Navdeep Jaikaria, Ph.D., Senior Biotechnology Analyst, issued the report.

About Rodman & Renshaw, LLC

Rodman & Renshaw is a privately held, full-service investment bank committed to fostering the long-term success of growth companies through capital raising, strategic advice, insightful research, and the development of institutional support. More information is available at www.rodmanandrenshaw.com

None of the research analysts or the research analyst's household has a financial interest in the securities of Vasogen Inc. (including, without limitation, any option, right, warrant, future, long or short position).

As of January 31, 2007, neither Rodman & Renshaw, LLC nor its affiliates beneficially own 1% or more of any class of common equity securities of Vasogen Inc.

Neither the research analyst nor Rodman & Renshaw, LLC has any material conflict of interest with Vasogen Inc., of which the research analyst knows or has reason to know at the time of publication of this research report.

Rodman & Renshaw, LLC or its affiliates did receive compensation from Vasogen Inc. for investment banking services within the last twelve months and Rodman & Renshaw, LLC intends to seek compensation from Vasogen Inc. for investment banking services within three months, following publication of the research report.

Neither the research analyst nor any member of the research analyst's household nor Rodman & Renshaw, LLC serves as an officer, director or advisory board member of Vasogen Inc.

Rodman & Renshaw, LLC makes a market in Vasogen Inc. securities as of the date of this research report.

The above information is not intended to be used as a primary basis of investment decisions. It is not a representation by Rodman & Renshaw, LLC or an offer or the solicitation of an offer to buy any security. Before investing in Vasogen Inc., you should carefully consider your risk tolerance and financial objectives.

Contacts:

Rodman & Renshaw, LLC
William A. Iommi
Chief Compliance Officer
Tel: 212-356-0549
Fax: 212-581-5690

Source: Rodman & Renshaw, LLC

Vasogen Appoints Terry H. Gregg President & CEO
Wednesday March 7, 7:00 am ET

In 1996, Mr. Gregg became President and Chief Operating Officer of MiniMed Inc., now a world leader in insulin pump therapy and continuous glucose monitoring, and was instrumental in Medtronic's US$3.4 billion acquisition of the company in 2001. Mr. Gregg retired as President of Medtronic MiniMed in 2002. He also served in executive positions with Smith & Nephew plc, a diversified healthcare product company, and Allergan, Inc., a leading ophthalmic device and pharmaceutical company. He is currently a Special Venture Partner with Galen Associates, a private equity firm specializing in the healthcare sector, serves on the boards of DexCom, Inc. and LMS Medical Systems, Inc., and is Executive Chairman of Patton Medical Devices, LC. Mr. Gregg also served on the Boards of Amylin Pharmaceuticals, Inc. and Ocular Sciences, Inc., which was purchased by The Cooper Companies, Inc. for US$1.2 billion last year.

"Vasogen has an exciting future and I am pleased to assume the role of President and CEO of a company with a solid scientific team and experienced management who are committed to achieving success," stated Terrance Gregg. "As a founder of Vasogen, David Elsley has provided visionary leadership since the Company's inception and has positioned us well for the future. I look forward to working with David as we transition from a development-stage company to a successful commercial enterprise."

"Terry Gregg's vision and his experience in transforming MiniMed from a development-stage therapeutic device company to a global leader in diabetes management systems will prove invaluable as we prepare for the commercialization phase of Vasogen's Celacade technology," stated David Elsley. "I am confident that the key findings from our ACCLAIM trial provide a strong foundation to move to the next level of Vasogen's evolution and I look forward to my continued involvement as an active member of the Board."

The 2,408-patient phase III ACCLAIM trial of Vasogen's Celacade(TM) technology (Celacade) in patients with chronic heart failure, completed in 2006, demonstrated strong results in two important pre-defined patient subgroups. While the study did not meet its primary endpoint, Celacade was shown to significantly reduce the risk of death or first cardiovascular hospitalization by 39% in patients with NYHA Class II heart failure at baseline (n=689, p=0.0003), and by 26% in patients with no prior history of heart attack at baseline (n=919, p=0.02). The Company is currently pursuing partnering discussions to support the initial commercialization of Celacade in Europe on the basis of these results. The Company is also preparing to meet with the FDA to review the ACCLAIM results for the purpose of determining the next steps in the regulatory pathway for Celacade in the United States.

About Vasogen:

Vasogen is a biotechnology company engaged in the research and development of therapies that target the damaging inflammation associated with cardiovascular and neurodegenerative disorders. The Company's lead product, the Celacade(TM) technology, is designed to trigger the immune response to apoptosis - an important physiological process that regulates inflammation. Celacade(TM) is in late-stage development for the treatment of chronic heart failure. The Company is also developing VP025, an early-stage new drug candidate for the treatment of certain neurodegenerative diseases.

R&R $3 12 month price target based off the following

-no PMA submittal for class II patients to FDA
-2 years testing of Celacade of phase IIIb (FDA approves new phase IIIb and no class II patients for PMA) and no commercialization in US until 2010
-190 million outstanding shares, currently 173 million OS
-another PIPE of $30 million on 10 million shares end of year, at $3 pps
-only 2% market penetration in the EU in 2008
-only $1500 per treatment per patient per year in EU, they feel market could bare $5000 per year per patient, they feel $3000 per year per patient is more likely, they only used $1500 per year per patient on a conservative basis
-no milestone payments from EU partner factored in, no sign on cash infusion from EU partner factored in
-EU partner in first half of year
-FDA first half of year
-P/E discounted annually at rate of 40% per year

The report is worth buying if you plan on holding shares. These criteria the estimate the $3 target from are extremely achievable, and are underestimated. JMHO

R&R feels PRESENT VALUE of the company is $2.3 per share, and held at current prices for obvious reasons. Hedge fund influence?

If you feel like I do that these criteria are under estimated and achievable then you buy as much as you can, and hold for a year where they feel an institution will pay Vasogen 3$ per share for 10 million shares. If you feel these criteria are over estimated and can not happen, then sell me your shares. <o:p> </o:p>

VSGN was up 15% with the sound volume yesterday and down 5% with light volume today. It seems we will get some good news on FDA or European partner. 

The evil reign of the King is coming to a close, the end of the Road. We loyal longs have been the unfortunate witnesses to a master class in manipulation. KR has managed to forcibly suppress the stock price despite a host of factors that should have produced liftoff. Let's review:

1. The VSGN stock price should NEVER have been below $1.00. The initial Celacade press release described promising results for a major prespecified subgroup. Biotechs with TOTAL failure of their only P-III trial rarely tank 70%, even over time, let alone right from the start.

2. A highly anticipated presentation in Barcelona elaborating on the promising possibilities.

3. Continuing news of serious negotiations with a prospective European partner.

4. Major investment by at least two highly respected funds.

5. A Rodman & Renshaw recommendation in which the analyst really stuck his neck out with a $3 target. If they just wanted to manipulate upward, a target of $1 or $1.50 would have sufficed.

6. The entrance of Terry G.

Given the cicumstances, what does everyone deserve?

1. DE - He deserved to lose his job. IMHO he has made reasonable presentations, said the right things and made appropriate efforts to advance the company. He never really had a chance given the cards he was dealt. The trouble is that he was the dealer. The devil's arrangement with KR should never have been made. Surely, he could have found a legitimate company to make a real investment in VSGN at $5, $3 or even $2. This terrible deal sealed the company's fate and caused big, unnecessary dilution for months.

2. King's Road - They deserve to go to Hell. Under the best of circumstances, making and taking advantage of their convertible deal involves highly questionable ethics. When doing so against a company like VSGN that is trying to save lives, case closed.

3. Sick patients - They deserve ASAP a treatment like Celacade and an FDA that empathizes with desperate patients and lets an important advance with no bad side effects get to market swiftly for once. Hang in there!

4. Long holding and suffering shareholders - We deserve BIG profits for keeping the faith and trusting the science. Let us hope!!! <o:p> </o:p>

Vasogen to Conduct Webcast and Conference Call of Annual Meeting
Wednesday March 28, 7:00 am ET

    To participate via webcast, please go to  www.vasogen.com .        To participate by telephone, please connect 10 minutes prior to the call      to one of the following:                     -------------------------------------------                    Direct Dial:  416-644-3419                   -------------------------------------------                    Toll-free:    1-800-814-4861                   -------------------------------------------        Telephone participants can also log onto www.vasogen.com to follow the      slide presentation and will have the opportunity to ask questions.        A re-broadcast of the conference call will be available at      www.vasogen.com and may also be accessed by:                     -------------------------------------------                    Direct Dial:  416-640-1917                   -------------------------------------------                    Toll-free:    1-877-289-8525                   -------------------------------------------                    Pin code:     21224833                                  followed by the number sign                   -------------------------------------------        About Vasogen: