It is no mystery that Kraig Biocraft Laboratories is a research and development company. They do not have the infrastructure to immediately compete against the biggest players in the technical textiles market. They do not need to focus on supply chain management or building a large sales and marketing team. This is simply not their goal.

Investors or potential investors should not be alarmed by this lack of infrastructure if you will. The long-term performance of one's investment in this company is based on its response to two fundamental questions: 1) Can Kraig Biocraft harness its spider silk technology into a package that can be readily used in commercial applications, and 2) Does Kraig Biocraft have the intellectual property rights behind its technology?

From recent statements delivered within the past year from CEO Kim Thompson, it appears that Kraig is very much on the verge of fulfilling both of the questions above. Once they are met, Kraig will be seen as an attractive buyout to those companies having the established infrastructures capable of delivering Kraig's technologies in commercial applications. DuPont and Honeywell would be the first two major players that come to mind.

Amid the economic downturn, the number of mergers and acquisitions within the biotech fields has remained consistent and extremely beneficial to the company taken over. Look at other buyout offers within the biotech field during the past two years:

• At $1.72 per share, synthetic fuels and fertilizer technology company Rentech Inc was proposed to be bought out at $2.70 per share by Sherwood Investments Overseas Ltd (November 2007) - Rentech shares rose more than 32 percent on the news that day
• When GlaxoSmithKline PLC proposed to buy Genelabs Technologies Inc. for $1.30 per share, the stock price of Genelabs rose 430% (October 2008)

Overall, it appears that Kraig's stock price may move moderately from here on findings in the laboratory or based on the progress with current or new patent filings. The huge jump will take place when a takeover is announced. Whether this news takes place in a year or in two years, the investment will be well worth the wait considering the potential gains that can be made in that one day.

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