September started with a healthy return of money to the depressed stock market. The "Sell in May and go away cyclical" depression of the TSX-V, combined with a widespread pessimism about the economic outlook resulted in a lot of money being parked on the sidelines. This money is now gradually returning to the markets. This will be a great environment for best in class companies to attract investors in the upcoming few months. Here is an update on some of the latest developments:

Sama Resources (SME.V)

I recently heard someone say Sama is making all the right moves. I couldn't agree more. The company started out with a very experienced and respected group of people. They found a promising land package and they did a quick promotional tour impressing analysts with the potential of their project. Following a few drill results they were able to prove their theory of a rich Ni /Cu and PGE polymetallic deposit in Ivory Coast and now they are reaping the benefits.

The latest financing was doubly oversubscribed and the demand just keeps coming. The only reason the company increased the size of the financing was because of quality of the investors and institutions that wanted to get involved. After this financing the company will be able to focus on drilling and will likely not need any more capital until the resource is proven and enticing enough for a takeover. The price is anchored around $0.45, but once this financing closes the stock should continue to rise as the excitement about the September drilling campaign bubbles up.

To re-iterate some key points: Dr. Audet is an Ni mining expert with decades of experience working in Ivory Coast. The management and advisory team consists of Ron Netolitzky, Jens Hansen, and Bill Lupien. All three are well respected individuals who bring a lot of credibility to the story. The company is looking to prove a Ni sulphide deposit. Drilling to date has uncovered three Ni-PGE rich targets with the very first hole returning 17.6m of 1.95%Ni, 1.95%Cu, 0.07%Co, 1.5gr/t palladium (Pd), 0.13 gr/t platinum (Pt) and 0.27gr/t of gold (Au).

We will accumulate under $0.45.

iCo Therapeutics (ICO.V)

ICO is actively pursuing partnerships for all three of their products. Aim is to secure non-dilutive sources of funding for further clinical trials. In the last update from the company I was told that the interest has spiked up recently and that ICO is receiving frequent unsolicited inquiries from parties interested in ICO's products. We would love to see a partnership deal for any of ICO's products, but if they are not able to secure a partnership by the end of the year the company intends to commence phase II trials for ICO-007 by other means of funding. So far there is a great interest from US institutions, but the company is resisting dilution.

I think ICO is a great company with three exciting products. ICO-007 is the main product in the very active ocular space. The share structure is incredibly tight with management owning a large portion of the outstanding shares. The share price has been declining on low volume but the majority of shareholders are tightfisted with their shares. I would love to see a partnership deal to further validate ICO's story and bring more buyers to the table. With a tiny market cap and a lot of interest I am very optimistic about ICO.

We are accumulating under $0.40.

Medicago (MDG.TO)

With the construction of the world's first plant-vaccine facility in the US, Medicago has taken the first, and giant one at that, step towards commercializing their influenza vaccine. From the very first day that we invested in Medicago we have been raving about Medicago's technology and now it is abundantly clear why that was the case. Medicago's DARPA sponsored facility will cost around $42M. The facility will be able to produce 120M doses/year and the construction is expected to be complete by July 2011. Now compare that to the large-scale cell-culture influenza manufacturing facility that Novartis started building in November of 2009. Total cost of that facility is $1B. Construction won't be complete until 2013 and the output is estimated at 150M doses in 6 months. Further to that, Medicago's manufacturing process is much simpler, more reliable, faster and cheaper. With the US facility on its way and 5 other on deck (France, India, Middle East, Japan, and Indonesia) Medicago could very soon be taking a big chunk of that multi-billion dollar influenza vaccine pie.

Also let's not forget that Medicago's technology is not limited to just the influenza vaccine. Medicago could in the future pursue other vaccine or protein/enzyme markets or they could license out their technology to other pharmas. Either way the future revenue potential for Medicago is enormous.

Despite the amazing technology and the promising future, Medicago has diluted this company to over 200M fully diluted shares. The share price is stuck around $0.35 as millions of shares continue to be sold off as a gypsy swap for the recent financing. This is now an institutional play and it will take institutional buying to push the stock price up. I would hold off on buying until the stock breaches the $0.40 level which should signal a breakout.

Melkior Resources (MKR.V)

Excitement is building around the Melkior and this is reflected in the recent price appreciation. Melkior's meticulous exploration work is paying off as the company is honing in on the deeper targets on it's West Timmins gold property. The down-hole IP survey will be used to identify potentially rich new targets for the sub 500m level drilling. It was generally assumed that wider and denser intercepts would be found at depth so people in the know are accumulating shares. The latest drilling campaign is expected to commence in late September.

We continue to accumulate.

Alert Service

Heads up on the alert service. Due to the large number of subscribers in the letter I cannot send alerts on quick flip opportunities so I've decided to roll out an alert service for active investors. Alert service will feature alerts on new buying opportunities, rumors, quick flips, investor events with select companies, first dibs on PP opportunities for accredited investors and a more frequent interaction. I am aiming to start the service in October and membership will be capped at 100 subscribers. Monthly rate will be $50 to ensure only serious investors are involved. If you are interested in being in the alert service, send me an email now and I will reserve your spot. Regular letter will still be around but likely published on bi-weekly or monthly basis.

Regards,

TB

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