PTC Therapeutics, Inc. (NASDAQ: PTCT)
PTC Therapeutics is having a rough time in the pre-market hours today following news that the company has entered into a definitive asset purchase agreement. Below, we'll talk about what we're seeing from PTCT, why, and what we'll be watching for with regard to the stock ahead.
What We're Seeing From PTCT
As mentioned above, PTC Therapeutics is having a rough time in the pre-market hours today. After announcing the signing of a definitive purchase agreement, the stock started to fall. As a result, PTCT is currently (9:00) trading at $10.34 per share after a loss of $0.56 per share or 5.14% thus far today.
Here's The Scoop
First and foremost, giving credit where credit is due, our partners at Trade Ideas were the first to inform us of the movement on PTCT. As soon as we received the alert, the CNA Finance team started digging to see why the stock was falling, even in light of the fact that the Q4 loss came in lower than expected just about an hour ago. Nonetheless, we believe we found the reason for the declines.
Ultimately the declines are associated with the fact that the company has entered into an asset purchase agreement with Marathon Pharmaceuticals. Under the agreement, PTC Therapeutics will acquire rights to Emflaza(TM), the first treatment approved in the United States for all Duchenne muscular dystrophy patients five years and older, regardless of their genetic mutation. The acquisition comes with a price of $140 million. However, this is concerning investors as there's been a pricing outcry surrounding this drug in particular. In a statement, Stuart W. Peltz, Ph.D., CEO at PTCT had the following to offer...
“With our nearly 20-year commitment to the Duchenne community, it is deeply meaningful for us to bring this critical therapy to U.S. Patients... We believe Emflaza is a disease-modifying therapy that has been shown to slow disease progression. In keeping with PTC's mission, we are excited to work with the community to raise the standard of care for DMD patients.”
What We'll Be Watching For Ahead
Moving forward, the CNA Finance team will be keeping a close eye on PTCT. In particular, we're interested in seeing whether or not the company will be able to turn a profit on this acquisition, especially considering the pricing blues the product has seen. Nonetheless, we'll continue to follow the story and bring the news to you as it breaks!
Update 12:46: PTCT continues to fall further on a slow and steady decline for the day. The declines are the result of concerns with regard to the acquisition of the new product, in spite of the strong earnings report that was released. At the moment, PTC Therapeutics is trading at $9.42 per share after a loss of $1.48 per share or 13.58% thus far today.
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