Different prognoses for blood substitutes

Paul Kelly of UBS Securities and David Crossen of Montgomery Securities issued extensive reports on blood substitute companies, reaching different conclusions.

Kelly initiated coverage of three companies: Alliance Pharmaceuticals Inc. (ALLP) with a "hold," and Northfield Laboratories Inc. (NFLD) and Somatogen Inc. (SMTG) with "sell" recommendations. He said the blood substitute market is vastly overstated at $5 billion, based on two misconceptions: that blood substitutes will sell at a significant premium, and that they can be used as direct replacements for allogeneic (donated) blood in acute blood loss situations...