Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Sanofi SA (ADR) (SNY), Biodel Inc (BIOD): Would It Be Foolish to Trust Unilife Corp (UNIS)?

Antares’ investors also have high hopes for its Otrexup treatment for rheumatoid arthritis. It could allow patients to self-administer methotrexate, a treatment taken by 70% of rheumatoid arthritis patients.

ATRS Revenue TTM Chart

Source: YCharts.

Antares’ financials look slightly better than Unilife’s, but they’re still not pretty. Its expenses are outpacing its revenue, its free cash flow is drying up, and its negative margins are keeping the company deeply unprofitable.

Just like Unilife needs Sanofi and Biodel Inc (NASDAQ:BIOD), Antares needs Teva Pharmaceutical, its primary backer. Teva is currently working on six different self-injecting drugs with Antares. Antares also has similar collaborations with Ferring Pharmaceuticals, Pfizer, Actavis, and JCR Pharmaceuticals.

Would it be Foolish to trust Unilife?

Investing in Unilife comes down to one thing — trust. If you believe that the company’s deals with Biodel Inc (NASDAQ:BIOD) and Sanofi will progress without a hitch, then this company’s stock is grossly undervalued at current prices.

However, a recent Forbes article has raised serious concerns about the company after Talbot Smith, an ex-employee of Unilife, filed a whistleblower lawsuit against his former employer alleging fraud and SEC violations. Smith also claims that Unilife falsified and excluded certain overhead expenses to boost its margins.

Investors should watch this case very closely to determine if Unilife can be trusted. If Unilife is found guilty, this company could fall apart like a house of cards as its collaborative partners head for the hills.

The article Would It Be Foolish to Trust Unilife? originally appeared on and is written by Leo Sun.

Leo Sun has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. 

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.