Radient Pharmaceuticals (AMEX:RPC) a Contender or Pretender?

The announcement last week by Radient Pharmaceuticals (AMEX:RPC) that they had received an order worth over $10 million for its FDA-approved Onko-Sure cancer test kits had the stock soaring, after it did little since peaking in April.

Another important announcement by the company was its being approved by NYSE Amex officials to do a debt-to-equity swap which will result in the elimination of $33 million in debt and convert it into equity valued at $22 million.

The swap was approved by shareholders in the early part of December. This came from the belief by shareholders the company put themselves in a place of being able to generate signficant revenue growth going forward.

Concerning the $10 deal, Douglas MacLellan, chairman and CEO of Radient Pharmaceuticals noted, “It is a commitment from our distributor in India, Gaur Diagno. The Indian government will order our test kits from Gaur Diagno, the entity that is implementing the cancer screening program for the government. That government program in India is larger than just the order of Onko -Sure kits. This is only a regional program at this point. If it was a national program, it would be 10 to 20 times larger. In fact we’re talking to the Rajiv Gandhi government and we’ve been in discussions at the national level with health ministers and others. Through Gaur Diagno, we’re in growing dialogue with the national government to institute a national screening program. I think that’s something we can do by the end of 2011.”

As far as other deals in the works, MacLellan added, “It takes months. The agreements, and particularly the ones announced in December, which is a new agreement in Korea - with a much bigger group - and a group in Hong Kong and China, that took eight months in development. So I would say that if we looked at the Middle East, Russia, selected countries in Eastern Europe as well as some of Europe. I would say that as we move into 2011, we’re talking about probably mid-year before those relationships will be locked in contractually and then they’ll start ordering kits within ninety days, normally. So many of those relationships will not be fruitful until the last quarter of the year, but that’s fine.”

Speculators are taking advantage of the news, but traders aren't convinced yet of the long-term viability of Radient, which closed Friday at $0.80, losing $0.38, or 32.20 percent.