Biotech

Aytu Bioscience AYTU Stock News

Time and time again, investors get taught a valuable lesson: invest for the longer term, and gamble for the short term. In fact, statistics show that while focused investing may lead to consistent financial gain, gamblers tend to lose almost 100% of the time using that same long-term mindset. For Aytu Bioscience investors, the path to significant revenue recognition has not been as quick as some had expected, but, it’s fair to say that AYTU may have finally caught traction in a multi-billion dollar urology market, focusing on global opportunities and commercialization of novel treatments and diagnostics. Thus, those focused on Aytu’s likely long term success should prepare to ultimately get rewarded.

Now flush with a growing pipeline of products that have either been FDA-approved or provided CE marking designation, AYTU is proving that their model of growth by acquisition is beginning to produce the investor rewards some expected months ago. The AYTU pipeline, which currently includes Natesto®, MiOXSYS®, ProstaScint®, and Fiera®, is gaining the consumer and physician attention they deserve, and recent revenue numbers and forward guidance is proving that fact.

Natesto® Sales Surge

Currently, Natesto® may stand as the most opportune product in the pipeline, and if the FDA took serious notice of the deficiencies in Natesto®’s competitive landscape, it’s likely that Natesto® would be addressing the multi-billion dollar testosterone replacement market on its own. Leaving the FDA-Big Pharma conspiracy theories aside, Natesto® has proven itself to not only be best in its class but is the obvious safe choice when it comes to overall safety and efficacy in patients treating their low testosterone levels.

In fact, Natesto® remains the only topical testosterone replacement therapy not labeled with a Black Box Warning, the most severe of disclaimers that the FDA requires for approved products that may hold serious safety and risk concern to patients. Different from FDA-approved products like AndroGel® and Axiron®, which have the Black Box Warning, and are marketed by AbbVie and Eli Lilly, respectively, Natesto® provides proven treatment without the associated and known risk from AndroGel® and Axiron®. The effects of Natesto®’s competition can be severe, with the FDA citing the potential for heart attack, increased risk of prostate cancer, reduced sperm count, or in the case of an unintentional transfer of product, cause masculine traits to emerge on female bodies. Perhaps these side effects are one of the main reasons that Natesto® sales are beginning to attract market attention away from its competitors, and at the same time generating significant and noticeable top-line revenue increases.

According to the most recent sales data released from AYTU, Natesto® sales have reached all-time highs, increasing 20% between April and May, and compounded by an additional 20% between May and June of this year. Sales results should continue to track higher, especially when Natesto® has proven to be highly effective in treating and improving erectile dysfunction on all five of the measured domains, and showed dramatic and tangible improvement in the desire for sexual activity beginning in as little as thirty days from initial use.

Generating results by being the only nasally administered therapy, 91% of patients in Aytu’s pivotal clinical trial studying the safety and efficacy of Natesto® achieved normal testosterone results by day ninety of treatment. Of those treated in the twice daily dosing of Natesto®, over 70% achieved normal testosterone levels, also by day ninety of treatment. Importantly, being dosed through nasal passageways, Natesto® has also proven its method of administration to be far superior in comparison to topical treatments, with the occurrence of an accidental transfer of the TRT product unlikely and less of a concern for those who use the product on a daily basis.

While product sales have surged recently, the share price is not reacting as it should to the increased market traction. Natesto® is addressing a $2 billion market, and by grabbing just a 10% share of sales, Natesto® could bring in over $200 million in revenue for Aytu. Additionally, if the FDA was proactive and strict in managing drugs that have been proven to cause severe health issues and even death in some patients, Natesto® may indeed be in a position to grab a significantly higher percentage of the market share. But, let’s not count on the FDA to make the sales for Natesto®, as the product can do it on its own. And, the trends in place should be a signal to investors that Natesto® is beginning to seize its opportunity to garner significant market share as the only FDA-approved, nasally administered testosterone replacement therapy. With a 300% increase in Factory Sales Units expected between the Q2 and Q4 in the fiscal year 2017, an exclamation point to the momentum is certainly warranted. To put that sales number in perspective, real demand and production show an increase in sales and orders from 1,764 units sold in Q3 of 2017 to a projected 4,248 units produced for sale by the end of the company’s 2017 fiscal year. Thus, while estimates are encouraging and investors like to hear positive guidance from management, real demand trumps all, and the focused commercial effort to drive Natesto® sales has generated record sales volume for the product.

While AYTU success is accelerating on the Natesto® front, the company is creating additional and accretive support from other pipeline products, results generated from management’s forming of a strategic initiative to fully integrate into the urology and sexual wellness market. By capitalizing on strategic opportunities, AYTU is focusing on its already commercially available products and building a focused salesforce to drive prescriptions from a product portfolio that has been de-risked from both a clinical and regulatory perspective. And, when analyzing the product pipeline, each product offers significant opportunity to generate substantial revenue increases.

MiOXSYS® Now In 20 Countries

Take MiOXSYS®, for instance. MiOXSYS® is a CE marked, male infertility device that is now sold in twenty countries and used as an infertility diagnostic system. The first-in-class “in-vitro” diagnostic device is a test available to physicians who require rapid in-office screening for male infertility. The test is unique, measuring undetected oxidative stress as an added indicator to current testing and semen analysis procedures. Working to capitalize on the United States market, MiOXSYS® is currently progressing through the U.S. regulatory process toward a 510K pathway, which should provide an abbreviated and well-defined track to approval.

Potential approval and research support gets generated from multiple prominent U.S. study sites, and the expected results will not only help to identify infertile patients quickly but will also allow immediate initiation of treatment, improving the chances of a wanted pregnancy. As a device, the company intends to exploit the razor-razorblade marketing model, generating recurring revenue from its globally patented disposable sensor technology. Considering the potential for mass adoption of this intelligent device, the opportunity is significant.

Worldwide, the male infertility market opportunity is estimated to reach $4.7 billion by 2025, with approximately 80% of that total derived from outside of the United States, countries where MiOXSYS® is already on-market. In just the first half of 2017, market placement for MiOXSYS® doubled, and Aytu expects that that placement number will double again during the next twelve months. With the MiOXSYS® device placement expanding on a global basis, including countries in Europe, Africa, Asia, Australia, and the Pacific regions, the opportunity for Aytu management to exploit global commercialization is ripe. Keeping in mind that Josh Disbrow, CEO at Aytu, has already proven himself by taking Arbor Pharmaceuticals from zero revenues to over $127 million in less than five years’ time, investors should remain confident that the same pathway to substantial sales increases can be duplicated with MiOXSYS®. But, even with a successful model already in place for MiOXSYS®, Aytu offers more to investors.

ProstaScint® Is Already FDA-Approved

Remember a key point in the thesis for considering Aytu. The company is almost entirely de-risked from FDA regulatory pressure, which serves to enhance additional opportunities presented from other pipeline products like ProstaScint®, AYTU’s FDA-approved prostate cancer imaging agent.

Clinical performance for ProstaScint® has been close to perfect, returning results with greater than 95% accuracy, along with durable and positive predictive value in patients. When the ProstaScint® agent gets used in combination with either single-photon emission or computed tomography, the accuracy in cases of profiling high-risk patients with Gleason levels of 8-10 provided results of between 95.7% and 100% when evaluated for accuracy, sensitivity, and positive predictive value. Now, with both SPECT and CT routinely made part of a prostate examination, Aytu believes that the results generated by ProstaScint® offer a compelling case for use in clinical evaluation, and is strategically adding the product to the sales team’s arsenal of marketable therapies.

The opportunity is, once again, significant. The global prostate cancer drug market has grown beyond $7 billion in 2016, up from only $2.5 billion in 2011. With an estimated ten drugs either in late-stage development or commercially available, the market is looking for reliable screening alternatives that can catch the disease in its earliest stages. The issue is serious, with prostate cancer identified as the second most common form of cancer in men, with an estimated 240,000 new cases reported each year. When diagnosed early, performing a prostatectomy in combination with radiotherapy has resulted in virtual five-year survival rates in patients 100% of the time. However, that’s in the cases where cancer gets identified in the early stages. Poorer diagnosis and screening lower five-year survival to just 37% in patients, demonstrating the importance of having reliable and sensitive measures in place to detect prostate irregularities. So, it’s not a matter of “if” the market needs an agent like ProstaScint® to accentuate the results, it’s more a question of how the Aytu sales team can effectually manage its multiple market opportunities to drive sales.

In a nutshell, the “so-called” issues facing Aytu growth are not problematic at all. With four products either in the pipeline or already commercially available, building its salesforce takes time. Each product has multi-billion dollar potential, and each requiresit’s the company’s dedicated team of professionals to drive those opportunities. So, for investors, the short-term growth pains that have stagnated the share price may, in time, generate exponential returns as the company continues to implement its marketing plan. But, Aytu’s strategy to drive growth and value opportunity does not stop at the three products already discussed. A fourth has emerged, and its future is just as promising.

Fiera® Added To Aytu’s Product Arsenal

The first products in the Aytu pipeline were, for the most part, designed to assist men in either sexual dysfunction symptoms or with cancer screening. However, expanding on its opportunities to grow through acquisition when appropriate, Aytu purchased Nuelle, Inc, on May 5, 2017, acquiring the rights to Fiera® in the process.

Developed by Nuelle, Fiera® was born out of thorough and significant clinical evaluation and validated by extensive consumer research. Already commercially available, Fiera® is gaining attention from the over 43% of women that have identified as having one or more sexual concerns. And, the market is substantial, with an estimated 53 million women in the United States alone meeting the clinical criteria as having sexual dysfunction issues.

Fiera® is the first pre-intimacy device proven to increase sexual desire and arousal in women, utilizing two clinically validated technologies of suction and stimulation to enhance blood flow to areas of the vagina that induce sexual interest and desire. Fiera® has generated highly favorable reviews, and in almost 90% of all responses, females expressed that the mood for sex, the enjoyment of sex, the looking forward to sex, and the excitement about sex improved significantly. An additional set of responses favored Fiera® for its ability to generate enhanced sexual intimacy, heightened orgasms and pleasure, and a greater feeling of arousal.

As is the case for each of the other products being developed and marketed by AYTU, Fiera® offers substantial market opportunity. The global market for female sexual dysfunction is increasing at a significant pace, and the awareness of having options available to address the issues is growing accordingly. Because of the technological advances and research capabilities, North America dominates the current female sexual dysfunction market. However, markets in countries throughout Asia and Europe are quickly developing, and are expected to create meaningful opportunities in the next several years. The growth rates of female sexual dysfunction should continue to bode well for AYTU, as Fiera® is already on the market and is targeting the estimated $4 billion market that continues to grow. Now with Fiera® in hand, Aytu can take advantage of the exploding market potential outside of the United States, noting that Fiera® is the only scientifically validated, with clinical device to contribute to decreasing or eliminating sexual dysfunction measures in women, and the only to improve pre-intimacy sexual desire.

How Aytu Bioscience Brings It All Together

Although Aytu has the ingredients in place to deliver exceptional growth, it will take vision, strategy, and focus to deliver tangible results. Led by an experienced management team and an independent BOD, Aytu is proving its capability to achieve their desired results. Although the share price is not reflective of the inherent value of the company, the track record of the leadership team has been shown to be reliable, as Natesto®, ProstaScint®, MiOXSYS®, and Fiera® are already commercially available in worldwide markets. Since the launch of Natesto® in August of 2016, quarterly sales have continued to increase, and the product is supported by a fully developed commercial infrastructure.

To capitalize on the opportunities presented by both ProstaScint® and Fiera®, the company is building its professional sales presence in the U.S. and is further developing its distribution channels to take advantage of an increasingly global market. The opportunity held by MiOXSYS® is also compelling, and any company would likely be able to realize serious potential from that product alone, but for Aytu, it’s only one piece of a well-defined and niche oriented product portfolio.

According to management, the strategy is in place to continue to acquire late-stage urology pipeline products that can be quickly accretive to company revenue and asset growth. Enhanced by patent protection, the vision to build upon its income generating base of treatments not only provides an opportunity for proper valuation multiples to be applied but creates an asset base for a future strategic opportunity. Aytu sports a team of sixty employees, and with forty dedicated salespeople in place, the focus on developing product sales and opportunity has moved to the forefront of the business. Concluding a bolstering of its sales force several months ago, Aytu is lean, focused, and determined to deliver shareholder value in the near term.

The current market cap of less than $6 million borders on ridiculous for a company that has four products commercially available and entirely de-risked from a regulatory perspective. And, with only 16.4 million shares currently outstanding, Aytu has capital leverage and availability to add to their portfolio should an attractable acquisition candidate emerge. Insider ownership at roughly 20% of the outstanding shares also works to align insider interest with that of the retail and institutional holders, thereby magnifying the allegiance to increase shareholder value in an accretive and non-dilutive manner when appropriate. With a product arsenal that is growing at a significant pace, and with plenty of product adoption still available to the company, Aytu, at these levels, deserves serious investor attention. As long as investors recognize that an investment into Aytu may take a quarter or two to develop fully, the ultimate reward may pay significant returns, especially once all four of its products begin to absorb substantial market attention.

In a market that teeters on volatility, staying course with a company like Aytu Bioscience, which has significant assets available for commercial market penetration, may prove to be far less risky than many perceive -and the opportunity, especially at currently depressed prices, may be ripe for the taking.

Disclaimer- CNA Finance is NOT an Investment Advisor. Our goal is to bring both news and under discovered stocks to the attention of investors to assist in making smart decisions in the market. CNA Finance is a for profit company. That profit is generated through three (3) different types of relationships. First and foremost, we work with pay per click and CPM advertisers on banners. We also have affiliate relationships with various companies where we earn a portion of the sales we refer. Finally, we may have relationships with some of the companies or IR firms that represent companies mentioned within our works in which we are compensated in cash and or stock for consulting, investor relations, and Press Release services. Hart Partners paid CNA Finance $3,500 to hire Perceptive Analytics for research and writing services as well as other investor relations services provided to Aytu Bioscience by CNA Finance. All information researched and provided through any article associated with Aytu Bioscience and published on CNA Finance is public information that is documented and available upon request. CNA Finance encourages all investors to seek professional advice before making any investment decision.

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VBI Vaccines, Inc. VBIV Stock News

VBI Vaccines, Inc. – Ordinary Shares (NASDAQ:VBIV) now has a clear route to market for its lead development asset, a hepatitis B vaccine called Sci-B-Vac. The drug is already approved in certain regions globally and is a standard of care therapy in Israel, but in the markets where the real money is (the US, Canada, and Europe) it remains non-commercially available. VBI has spent the last twelve months readying the asset for a pivotal clinical program that could serve as the final step along the development pathway and – as per the company’s latest release – this step is now underway.





The hepatitis B market

With the release in question, management has outlined the protocol and design of a phase III program that will serve to underpin registration submission with the US Food and Drug Administration (FDA), the European Medicines Agency (EMA) and Health Canada (HC). Analysts suggest that the hepatitis B market will expand to be worth $3.5 billion by 2021. Of this $3.5 billion, eight major markets account for nearly 75% of the total figure – the US, Canada, the UK, France, Germany, Italy, Spain, and Japan. An approval from the FDA, the EMA and HC would allow VBI Vaccines (NASDAQ:VBIV) to target seven out of these eight regions, meaning the company would be going after a market worth somewhere in the region of $3.15 billion, with this calculation based on the assumption that each of the eight regions account for an equal portion of the total market, which is very conservative.

The importance of the just announced program, then, is clear.




A look at the clinical program – overview

Using the company’s just released protocol, here’s a breakdown of what the company is planning to conduct and how it plans to do it.

The program is a phase III global program that will enroll around 4,800 patients spread across the three target regions – the US, Europe and Canada. It’s set up to include two separate phase III studies, the data from which VBI will collate at completion and submit to the relevant authorities. The ability to base three submissions on a single program (the two trials) shouldn’t be overlooked here. Phase III trials are expensive. For a company like VBI Vaccines (NASDAQ:VBIV), which is at the smaller end of the biotech spectrum, research and development costs can be a make or break input. One program means one third of the cost, which means investors are being asked to take on a much-reduced risk (primarily rooted in reduced capital requirement mitigating the necessity to raise funds via an equity raise and – in turn – reducing the risk that the company will dilute shareholders to any substantial degree) when they pick up an exposure to this program.

The clinical program – the first phase III study

The first of the two phase III studies is designed to pitch Sci-B-Vac against the current standard of care vaccine in the hepatitis B space, GlaxoSmithKline plc (ADR) (NYSE:GSK)’s Engerix-B. If the company is going to get Sci-B-Vac approved as a hepatitis B vaccine in its major target regions, it’s going to need to show that the asset can induce seroprotection in standard population patients – in this instance, defined as healthy subjects aged 18 years and over. There’s also an added focus, targeting patients aged 45 years and older (more on this shortly).

There are two primary endpoints in place.

The first primary endpoint is geared towards the necessity to prove that Sci-B-Vac is as good as Engerix-B in ages 18 years plus, with the endpoint hit defined as Sci-B-Vac demonstrating non-inferiority to the standard of care drug as measured by the the seroprotection rate induced four weeks post final dosing (total administration involves three doses of each vaccine).

The second primary endpoint is designed to show that Sci-B-Vac can outperform Engerix-B in patients ages 45 years plus. This is an endpoint that markets are going to be watching incredibly closely because, if hit, it will create a major differentiation between the two vaccines involved in the study, favoring Sci-B-Vac. VBI has long pitched its vaccine as having the potential to be a better option for immunosuppressed patients. These are patients that, for a variety of reasons, have a sub-optimal immune system. When the immune system doesn’t work optimally, it won’t create the antibodies that are at the root of the mechanism of action (MOA) of prophylactic vaccination. By including more hepatitis B specific antigens in Sci-B-Vac than there are in Engerix-B, VBI Vaccines (NASDAQ:VBIV) is hoping to increase the number and variety of antibodies that form post-administration. This, in theory, should improve the degree of seroprotection for this immunosuppressed category of patients. In this instance, and with this study, the immunosuppressed group is over 45 years, with the immunosuppression rooted in age.

The clinical program – the second phase III study

That’s the first study. The second study is a lot to lot study that, again, compares VBI’s asset with Engerix-B. Patients in this one will be randomized to receive either Sci-B-Vac or Engerix-B, with three out of four patients receiving the former. The Sci-B-Vac patients will be further split into three groups, each of which will receive a version of the vaccine from a particular lot.

The primary outcome of this study is to demonstrate that the geometric mean concentration (GMC) of antibodies is the same across each lot of Sci-B-Vac. It’s basically a quality control arm. While the company hasn’t specifically served up its reasoning behind including this type of study in its program, it’s reasonable to conclude that the regulatory authorities across the target regions requested it so as to ensure that the drug can be produced in varying geographies and can be transported from one region to another without deteriorating in quality. If this is the case, it’s a small price to pay for the ability to conduct one global study and to use the results of this study to apply for approval in three major regions.

In addition to the GMC of antibodies across the three lots, the company will also measure the safety and efficacy of the three lots as compared to one another and to Engerix-B as a secondary endpoint. The assumption here is that this data will be used to reinforce the data collected from the first of the two phase IIIs as and when VBI submits for registration.

Conclusion

The initiation of this program is something that VBI shareholders have been waiting for patiently for the last twelve months. That the company now has its protocol in place and some solid timeframes to work with (initiation during the second half of 2017, fifteen months to trial completion) makes VBI Vaccines (NASDAQ:VBIV) a far less speculative exposure than it was just a few weeks ago and, as a result, the company will likely benefit from an inflow of speculative volume rooted in investors taking a position ahead of the trial’s initiation and eventual outcome.

VBI is not without its risks, of course. This is development stage biotechnology and the future success of the company in hepatitis B relies on an upcoming binary event (the outcome of this phase III program) being favorable. If it’s not, VBI will struggle to reestablish a presence in this sector going forward. With that said, the existence of real world data from the nations in which this drug is already approved and the data set that the company has put together to date (which includes safety and efficacy data from more than 2000 patients) serves to reduce this risk considerably.

Disclosure: The author has no positions in any of the stocks mentioned.

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Novavax, Inc. NVAX Stock News

Novavax, Inc. (NASDAQ: NVAX) is having yet another incredible day in the market today, and for good reason. Today is the day of a key update that investors have been waiting for. Of course, the excitement continues to build after the stock climbed around 50% since July 17th. As is almost always the case, our partners at Trade Ideas were the first to alert us to the gains. At the moment (10:44), NVAX is trading at $1.72 per share after a gain of $0.24 (16.22%) thus far today.





NVAX Climbs Ahead Of Update

As mentioned above, Novavax is having an incredible day in the market today as we get closer and closer to a very important conference call. The rally started on July 17th, after the company announced that it would be hosting a conference call and webcast today. The call will be held at 4:30 ET and the information to get involved is below.




This particular call surrounds topline data from a recent Phase 2 Safety and immunogenicty trial of the RSV-F vaccine the company has been working on for adults 60 years of age and older. NVAX also said that it will be providing updated information with regard to prior Phase 2 and Phase 3 clinical trials in older adults and its RSV Phase 3 clinical trial for infants via maternal immunization. Here is the agenda for the webcast:

  • First NVAX will announce topline data from the Phase 2 safety and immunogenicity trial in older adults.
  • The company then intends to provide additional findings associated with previous Phase 2 and Phase 3 clinical trials in older adults.
  • Finally, NVAX will provide an update on the Prepare(TM) clinical trial for infants via maternal immunization.

If you’d like to take part in the study, you can do so by either calling in or clicking at 4:30 ET tonight. Here’s the information:

  • Call In – If you plan on calling into the Novavax presentation, you can do so by calling (877) 212-6076 if you’re in the United States or calling (707) 287-9331 if you are not. The passcode for the call is 54820069.
  • On The Web – You can also log into the webinar by going to www.novavax.com.

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What We’ll Be Watching For Ahead

Moving forward, the CNA Finance team will be keeping a close eye on NVAX. In particular, we’ll be listening to the presentation later today, and we are overwhelmingly excited to learn more about the data. We’ll continue to follow the story closely and bring the news to you as it breaks!

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Dynavax Technologies Corporation DVAX Stock News

Dynavax Technologies Corporation (NASDAQ: DVAX) is off to an incredibly strong start in the trading session today, and for good reason. Early this morning, the company informed investors of an FDA advisory committee review of an experimental drug. Of course, this led to excitement among investors, sending the value of the stock toward the top. As is normally the case, our partners at Trade Ideas were the first to alert us to the gains. At the moment (9:42), DVAX is trading at $9.80 per share after a gain of $0.20 per share (2.08%) thus far today.





DVAX Gains On FDA Committee Review

As mentioned above, Dynavax Technologies is having an incredibly strong day in the market today after announcing that the United States Food and Drug Administration has informed the company that the Vaccines and Related Biological Products Advisory Committee will review HEPLISAV-B(TM) at its scheduled meeting which will take place on July 28th.




This is interesting, as the PDUFA date for HEPLISAV-B is only a few weeks away, coming in at August 10th. The FDA intends to communicate specific questions with the VRBPAC and will draft an agenda for the questions, which will be on its website at least 48 hours prior to the meeting. In a statement, Eddie Gray, CEO at DVAX, had the following to offer:

The notification of a VRBPAC meeting comes as no surprise and thus we are prepared for it… The company looks forward to continuing work with the FDA through the review process and discussing HEPLISAV-B with the advisory committee.”

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What We’ll Be Watching For Ahead

Moving forward, the CNA Finance team will be keeping a close eye on DVAX. In particular, we’re interested in following the meeting with the VRBPAC and excited to learn whether or not the vaccine will find its way to approval, and subsequently, commercialization. We’ll continue to follow the story closely and bring the news to you as it breaks!

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Sarepta Therapeutics Inc SRPT Stock News

Sarepta Therapeutics Inc (NASDAQ: SRPT) is having a rough start to the day today in the pre-market hours, and for good reason. The company announced an offering this morning that’s proving to be a cause for concern among investors. Of course, our partners at Trade Ideas were the first to alert us to the declines. At the moment (8:58), SRPT is trading at $42.15 per share after a loss of $1.26 per share (2.90%) thus far today.





SRPT Announces Offering

As mentioned above, Sarepta Therapeutics is having a rough start to the day in the pre-market hours today after announcing an offering. The company announced today that it plans to sell $250 million in shares of common stock in an underwritten public offering. The company also hopes to grant the underwriters a 30-day option to purchase an additional $37.5 million in shares of common stock.




The first purchase in this offering is likely to come from Douglas Ingram, the President and CEO at SRPT. In fact, he has expressed that he is interested in purchasing up to $2 million in stock at the offering price.

The offering will be done with the assistance of Goldman Sachs as well as J.P. Morgan Securities, as they act as joint book-running managers for the proposed offering. It was also announced that Credit Suisse Securities will be acting as a joint book-runner.

What Is The Money For?

SRPT said that the proceeds produced by the offering will be used largely for the continuation and initiation of further clinical trials, commercialization, and manufacturing, as well as business development activities. The company also said that the funds may be used in the potential licensing or acquisition of complementary products and technologies.

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What We’ll Be Watching For Ahead

Moving forward, the CNA Finance team will be keeping a close eye on SRPT. In particular, we’re interested in following the company as it moves through the offering and starts to use the funding. We’ll continue to follow the story closely and bring the news to you as it breaks!

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Delcath Systems, Inc. DCTH Stock News

Delcath Systems, Inc. (NASDAQ: DCTH) is an interesting company to follow, one that I’ve personally covered quite a bit as of late. While the topic of discussion on my side has been the fundamental value of the company’s assets and the potential for a takeover, I had the opportunity to debate this with one of our avid followers. Believe it or not, my opinion has changed a bit following an incredible discussion.





Let’s Backtrack A Bit With DCTH

First and foremost, I want to talk about why I believe that the buyout potential is there. At the end of the day, Delcath Systems is an oncology company that already has a product on the market in Europe and is currently working on 2 clinical studies to bring the product to the United States. However, with a market cap of around $80 million, the company is a relatively cheap target for any larger oncology firm that wants to get their hands on what the company has going for them.

While I still believe that there is potential for a DCTH buyout, after my debate with a reader, I’ve come to terms with the fact that the buyout isn’t likely to happen any time soon. That’s not the big news we’ve been waiting on. Instead, there’s another piece of news that’s likely coming soon. That’s news of a reverse split.




While Reverse Splits Can Be Scary, This One Is Not

Here’s the truth of the matter, after digging into the financial data provided by the company, one thing is clear. They need to raise capital. The reality is that DCTH needs money in order to continue operating their business. However, this money is inaccessible at the moment. So, how does the company go about making the money accessible? They do so through a reverse stock split.

While a reverse split causes no real change in the market cap of a company, it does cause a difference when it comes to the investors, especially institutions that may be interested in the company. At the moment, because Delcath Systems is trading well below that magic $1 number, many of the larger investors simply won’t even look at the stock. However, a 1-for-10, or to play it safe, 1-for-15 reverse split would likely change things in a big way. This could give Delcath Systems access to the funds that it so desperately needs.

The Idea That RS Never Works Is A Farce

The reality is that when you say the term “reverse split” to an investor, the first thing that’s going to pop into their minds is that the stock is going to fall, and while that’s generally the case just after the split, it’s not always the case for the long-term outlook. The truth is that there have been plenty reverse splits throughout history that have worked. In fact, here are 3 examples of reverse splits that have worked:

  • Priceline.com (PCLN) – In 2003, PCLN processed a 1-for-6 reverse split, bringing the price of the stock from $3.50 per share to $22 per share. Today, the stock trades at nearly $2,000 per share – something that we likely wouldn’t have seen without the 2003 split.
  • Liberty Corp. of America (LH) – In 2000, LH processed a 1-for-10 reverse split. This split has been so successful that the company has done multiple 2-for-1 regular splits since, to maintain accessibility for smaller investors.
  • Corrections Corp. of America (CXW) – CXW was trading at about $0.60 per share before a 1-for-10 reverse split back in 2001. Today, the stock trades at nearly $30 per share, and the beginning of the growth was largely thanks to the fund accessibility that the RS provided.

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The Bottom Line

The bottom line here is that, in my opinion, DCTH is a great company. As mentioned in previous articles, they have made some financial mistakes, and those mistakes have put the company in a tough position. However, a reverse split, if carried out correctly, has the potential to solve many of the problems the company is facing. From there, they will be able to move forward, likely with positive news ahead. However, in order to do so, the company needs the support of its shareholders when it comes to the reverse split. After a hefty debate, I’ve come to grips with the fact that this is what needs to happen, and I hope that the shareholders of the company do too! Once this is behind us, we can expect quite a bit of positive news ahead!

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Interpace Diagnostics Group Inc IDXG Stock News

Those who have undergone surgery understand the hardships that come along with it – the lengthy hospital visits, the meticulous recovery processes, and the debilitating side effects that can significantly interfere with a patient’s daily activities. Not to mention, it’s no secret that these procedures are extremely costly even with insurance, and can be financially devastating to a patient who requires these services. Unfortunately, the medical industry is just that, an industry, and making a profit is just as much of a goal as providing care to patients. Additionally, many diseases can be difficult to diagnose, yet wreak havoc if left untreated. Take all of this into consideration, and one can see why it’s not uncommon for a patient to undergo a long, expensive, and potentially unnecessary process at the quick recommendation of their doctor, when a simpler solution could have been discovered before treatment even began. Enter Interpace Diagnostics (NASDAQ: IDXG), a company that has set out to provide personalized medicine that helps patients receive the right treatment, and at the right time.

The Importance of the IDXG Platform

Rather than providing the treatment itself, Interpace Diagnostics is a company focused on the diagnostics. In the medical world, there is often little time for patients to wait around while a condition continues to worsen, and doctors, needing to assist these patients as soon as possible, often greenlight inappropriate and expensive procedures despite having inconclusive data on the patient’s potential diagnosis. Moving forward with these indeterminate results can lead to unneeded or even wrong practices including unnecessary surgeries, which can result in taking money and resources from both the patient and the care provider as well as misdirecting therapies by the physician. Sensing a need to remedy this issue for the benefit of patient and industry alike, Interpace Diagnostics provides molecular diagnostic tests and pathology services at a time when current first line assessments of cancer are simply not able to determine the nature and extent of cancer. The Interpace Diagnostic assays for both thyroid and pancreatic cancer can paint a much more accurate picture not only of the patient’s current condition but also of the patient’s prognosis to deadly metastatic cancer, thus in turn assisting doctors to recommend the most beneficial treatment at the right time and delivered to the right patient. Not only does this allow the patient to receive only the necessary treatment for their condition, but it can also potentially prevents them from spending thousands more on a follow-up procedure due to a misdiagnosed ailment. These ideas are reflected in numerous statements from industry associations, with groups such as the American Thyroid Association and the American Society for Gastrointestinal Endoscopy recommending the use of molecular diagnosis in cases of indeterminate results. In addition to the health and financial advantages, IDXG faces much less risk than companies focused on drug development, enjoying lower developmental costs and a quicker path to the market. IDXG’s emphasis on discovering a precise diagnosis is something that can be appreciated by all parties involved, and investors should respect the robust portfolio the company continues to build.

IDXG Product Portfolio Serves Billion Dollar Potential

With three products on the market and a potentially lucrative fourth being prepared for a 2017 roll-out, IDXG has already built a powerful portfolio of molecular diagnostic products. The first of the three is PancraGEN®, a fully-integrated molecular pathology test designed to identify the risk of pancreatic cancer progression. Pancreatic cancer is the third most deadly cancer in the United States, with a five-year survival rate of only 7.2%, meaning a quick and accurate diagnosis is absolutely essential. In fact, clinical trials have shown PancraGEN to be significantly effective at identifying potential progressors to metastatic cancer in cases where biopsy results are indeterminate; meaning at a very early stage. While the 2012 Sendai guidelines are quick to recommend surgery due to the disease’s aggressive tendency, PancraGEN allows pathologists to have a better understanding of the risks at hand. With over 30,000 tests already performed in over 250 hospitals around the world, IDXG is enjoying continuous adoption and growth of their product. Most importantly PancraGEN is virtually the only product in this market currently and today that market is estimated to be in excess of $300 million. Along with PancraGEN, IDXG also has two products on the market designed to diagnose thyroid modules by identifying the possible signs of thyroid cancer: ThyGenX® and ThyraMIR®. An estimated 726,646 people in the US were living with thyroid cancer in 2014, and according to the American Cancer Society, an estimated 56,870 new cases of thyroid cancer have been diagnosed in 2017. Additionally, up to 18 million US adults have been plagued with thyroid nodules, which can carry the potential to lead to thyroid cancer if left untreated. Similar to PancraGEN, ThyGenX and ThyraMIR aim to eliminate the risk for unnecessary procedures stemming from indeterminate biopsy results. When used together, ThyGenX and ThyraMIR have been clinically shown to provide more accurate and detailed results of both ruling in and ruling out cancer, than the current market leader, Afirma, allowing doctors to prescribe the necessary treatment with confidence. Like PancraGEN, IDXG’s thyroid-focused products have also seen strong support from medical leaders, boasting a partnership with LabCorp and use by over 400 hospitals and physicians. The market for ThyGenX and ThyraMIR is also estimated to be in excess of $300 million with only a small number of competitors.

Finally, there is one more product in the pipeline at IDXG that deserves serious attention: BarreGEN®. BarreGEN is a molecular diagnostic test developed using the same platform as PancraGEN, to analyze the risk of esophageal cancer in patients with Barrett’s Esophagus. Investors should take note because there is massive potential in the market waiting to be realized by a product that may preemptively and accurately assess this risk. Barrett’s Esophagus is a condition in which the original tissue lining one’s esophagus is replaced with a tissue similar to that of the intestine. There is a small risk of Barrett’s Esophagus leading to esophageal cancer, which, like pancreatic cancer, is known to be one of the most lethal cancers in the world. Currently, no tests can predict whether a patient’s condition will lead to this disease, and IDXG is in the enviable position to fill that need. With over 3.3 million adults undergoing endoscopic screens annually, there is an estimated $1.5 to $2 billion market for a product like BarreGEN. BarreGEN began its Clinical Experience Program in September of 2016, and like IDXG’s other tests is designed to reduce the overall cost of care by providing an accurate diagnosis that quickly allows for the necessary and correct treatment. As stated earlier, the market is begging for a product that could help doctors accurately identify the risk of progression of Barrett’s Esophagus patients progressing to esophageal cancer, and since IDXG is already begin to prepare for its roll-out BarreGEN this year, IDXG’s current share price is in no way reflective of the substantial potential it could bring to the table. Clinical trials have demonstrated strong reliability in the test, and a successful launch of the BarreGEN product would almost certainly give this undervalued stock the attention it rightfully deserves.

A Company Transformed

From a financial perspective, IDXG has never looked better. The company has transformed itself mightily during the previous 18-months, boosting its balance sheet strength and increasing shareholder equity to roughly $24.5 million in the first quarter of 2017, a near 276% increase.

Revenue growth has been spurred by the recent reimbursement agreements from major insurance carriers, contributing to year-over-year revenue growth of 39% during the 2015-2016 fiscal accounting periods. Not only has revenue increased substantially, but IDXG also eliminated all outstanding debt, royalty, and milestone obligations from a 2014 asset purchase, and has raised approximately $26 million since the third quarter of 2016. Although growth is apparent and appears to be gaining momentum, investors were not treated to formal revenue guidance during the most recent conference calls, likely due to the complex accounting and receivables recognition associated with healthcare reimbursement. However, investors should not assume that the team lacks visibility or robust opportunity in the near term, especially when taking into account the company’s emerging financial strength and product adoption rates.

At the end of June, the company reported a cash balance of approximately $13 million, which is significant in that IDXG had slashed its operating overhead by approximately $30 million a year since 2016. Thus, with a cash burn rate churning at just $500K per month, IDXG is well positioned financially to proceed aggressively in driving revenue-generating opportunities for its broadening diagnostic platform. Now trading at less than a dollar per share, the company appears to be significantly undervalued, especially when investors consider that the business has no debt, at least two years of operating capital without including new cash flow, and has non-trading warrants that can bring an additional $21 million of cash to the company. Assuming all the warrants get exercised, IDXG will have an outstanding share count of approximately 36 million shares. What investors should find attractive about the warrants outstanding is that they have no cash value and do not trade on the open market, which dramatically reduces the financial overhang often associated to open warrants, as investors hedge stock positions utilizing arbitrage trading strategies.

As of now, however, IDXG has just 18.68 million shares outstanding, and the company is well placed to take advantage of the opportunities recognized from the adoption of the diagnostic portfolio. The IDXG product line address a combined market potential of more than $3 billion when accounting for successful market penetration of its PancraGEN, BarreGEN, ThyGenX and ThyraMIR diagnostic solutions.

At current prices, the case for investment is compelling.

IDXG Makes A Case For Itself

There are times when investors need to be told the story of a compelling stock, and then there are the cases where a stock can provide its own measure. IDXG is one of those companies that can let its accomplishments speak for themselves.

Too many investors make the mistake of lumping all sub-dollar stocks together, passing over the potentially lucrative opportunities that may be at hand. IDXG is far from typical, and for that matter, is differentiating itself from those that rightfully trade at sub-dollar levels. So, to not acknowledge that IDXG is far different from the others at its current price level may prove to be a terrible mistake – and, here’s why.

While a large number of companies trade at levels similar to IDXG, few can boast of having at least two years of operating capital in the bank, no debt, and a fully-diluted share count of less than forty million. Add to that a product portfolio that has already proven to be a necessary and much-needed addition to the healthcare industry, and the recipe at IDXG leads to success. The IDXG diagnostic products are not only necessary, but they should also be a requirement that the insurance industry puts in place to stop the unnecessary and often life altering events associated with surgical procedures that prove to be unwarranted. With IDXG products used as validating tools, not only can hundreds of millions of dollars of healthcare cost be saved, but countless numbers of lives may be spared the burden of surgical procedures that should never have been performed. But perhaps most importantly is that IDXG differentiates itself by not being just a sophisticated molecular diagnostics company. IDXG differentiates itself by being a provider of personalized medicine and IDXG is first and foremost a commercial company of over 20 sales reps that has sophisticated customers and provides sophisticated solutions. Once a company has the confidence of its customers at the highest levels the opportunity to commercialize other products may be significant.

And then there’s the fact that IDXG is addressing a multi-billion dollar industry, and is well positioned to capitalize from a partnership, licensing, and merger opportunity. Obviously, there is interest in what the company is doing, proven by successfully raising over $14 million in just the last six months. Insurance companies also realize the benefit, and the momentum of reimbursement inclusion is gaining momentum.

At roughly 90 cents a share, with sufficient cash in the bank and a diagnostic product line that can save both lives and money, IDXG becomes a compelling case for investor consideration. Markets often play catch-up and remain inefficient when pricing emerging companies. Retail investors are typically the last to know of businesses that bring transformational products to market. It’s true again, in this case, demonstrated by the fact that IDXG has raised substantial capital, eliminated all debt, and is positioned to generate exponential revenue increases in the coming quarters. Obviously, big money is already onto the story.

In this case, however, retail investors don’t need to be the last to know, as long as they pay attention to what IDXG is revealing to the market and respect the progress made on multiple fronts. IDXG may very well be a break-out winner in 2017. The next few quarters may spur a new chapter in the evolution of this promising company, but it may be just a small addition to the IDXG story that is only beginning to unfold.

Disclaimer- CNA Finance is NOT an Investment Advisor. Our goal is to bring both news and under discovered stocks to the attention of investors to assist in making smart decisions in the market. CNA Finance is a for profit company. That profit is generated through three (3) different types of relationships. First and foremost, we work with pay per click and CPM advertisers on banners. We also have affiliate relationships with various companies where we earn a portion of the sales we refer. Finally, we may have relationships with some of the companies or IR firms that represent companies mentioned within our works in which we are compensated in cash and or stock for consulting, investor relations, and Press Release services. World Wide Holdings paid CNA Finance $3,000 to hire Perceptive Analytics for research and writing services as well as other investor relations services provided to Interpace Diagnostics Group by CNA Finance. All information researched and provided through any article associated with Interpace Diagnostics Group and published on CNA Finance is public information that is documented and available upon request. CNA Finance encourages all investors to seek professional advice before making any investment decision.

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AEterna Zentaris AEZS Stock News

AEterna Zentaris Inc. (NASDAQ: AEZS) is off to an incredibly strong time in the market today, and for good reason. The company announced the formation of a special committee of independent directors as well as the appointment of the CEO. Of course, this led to excitement among investors, sending the stock toward the top and prompting our partners at Trade Ideas to alert us to the gains. At the moment (10:36), AEZS is trading at $2.90 per share after a gain of $0.10 per share or 3.57% thus far today.





AEZS Gains On Business Update

As mentioned above, AEterna Zentaris is having an incredibly strong day in the market today after announcing a key business update. The first part of the update focused on a special committee that the company formed, comprised of independent directors, to consider and evaluate various strategic and financing alternatives available. The goal here is to maximize shareholder value and continue executing on existing business plans and/or considering and recommending changes to the Company’s management and governance.




Management Changes

Also announced today, AEZS said that David A. Dodd is no longer the company’s President and CEO, effective immediately. However, he didn’t take long to replace. In fact, the board of directors at AEZS have appointed Mr. Michael Ward as the new CEO.

With him, Mr. Ward has more than 30 years of executive and legal experience in the healthcare, pharmaceutical, and technologies industry to bring to the table. He has served most recently as the Chief Compliance & Legal Officer and Corporate Secretary for Sagent Pharmaceuticals. He has also served as a Strategic Advisor to Benevolent Capital Partners for the past 5 years and is currently a partner at Outside GC LLC. The reality is that the list of his accomplishments could go on and on.

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What We’ll Be Watching For Ahead

Moving forward, the CNA Finance team will be keeping a close eye on AEZS. In particular, we’re interested in following the news surrounding the recent NDA acceptance and excited to see the result of the application. We’re also interested in following Mr. Ward as he guides the company. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!

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Pernix Therapeutics Holdings Inc PTX Stock News

Pernix Therapeutics Holdings Inc (NASDAQ: PTX) is off to a relatively rough day in the market this morning, and for good reason. The company announced refinancing transactions that are designed to improve the overall financial picture. Of course, this led to fear among investors, causing losses and prompting our partners at Trade Ideas to alert us to the movement. At the moment (9:43), PTX is trading at $3.81 per share after a loss of $0.68 per share or 15.14% thus far today.





PTX Gains On Refinancing Transactions

As mentioned above, Pernix Therapeutics Holdings is having a rough day in the market today after releasing a press release that announced a series of refinancing transactions. These transactions are designed to improve liquidity and extend debt maturities. The details of these transactions are as follows…




  • PTX brings on a new $40 million asset-based revolving credit facility. This will refinance the Wells Fargo credit facility that was due for maturity on July 31st.
  • The company has also announced a $45 million delayed draw term loan. This particular loan includes immediate access to $30 million as well as an additional $15 million available for specific acquisition purposes.
  • There’s also an exchange of approximately $52 million in 4.25% convertible senior notes owned by institutional investors for about $36 million of new exchangeable notes and approximately 1.1 million shares of stock.

According to the PR, the transactions are all expected to close today, July 21st. Of course, they are subject to customary closing conditions.

Amended Settlement Agreement With GSK

On top of the news above, PTX also announced that it has improved its liquidity position by amending an agreement with GSK under which PTX will pay approximately $6.65 million to GSK, a massive reduction from the initial settlement of $14.5 million. In a statement, John Sedor, CEO and Chairman at Pernix Therapeutics, had the following to offer…

Pernix has achieved significant progress in improving our business over the last 12 months… These transformative agreements remove the financing overhang from our company, provide us with capital through at least the end of 2019 and allow us to focus on further growing the business. In addition, we now have access to capital to opportunistically pursue additional product acquisitions in order to enhance Pernix’s position as a leading pain and neurology focused specialty pharmaceutical company. We are grateful to the institutional investors involved in this transaction for the confidence they have shown in our growth strategy and the Pernix team through this agreement.

The agreement reached with GSK helps to further deleverage the Company and provides us with additional financial flexibility moving forward… We are now solely focused on furthering progress achieved over the last year.”

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What We’ll Be Watching For Ahead

Moving forward, the CNA Finance team will continue to keep a close eye on PTX. In particular, we’re interested in watching the moves the company makes, especially on the product acquisition side, following today’s announcement. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!

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AEterna Zentaris AEZS Stock News

AEterna Zentaris Inc. (NASDAQ: AEZS) is having an overwhelmingly strong day in the market today, and for good reason. Not only has the FDA accepted a New Drug Application from the company, it is also the center of a key price target raise. All of this is leading to excitement among investors, causing gains in the stock and prompting our partners at Trade Ideas to alert us to the gains. At the moment (9:34), AEZS is trading at $2.81 per share after a gain of $0.47 per share (20.09%) thus far today.





AEZS Receives A Nod From The FDA

As mentioned above, AEterna Zentaris is having an incredibly strong day in the market today after the company received a favorable ruling from the United States Food and Drug Administration. News broke late yesterday that the FDA has accepted the company’s New Drug Application for Macrilen. The decision with regard to whether or not the drug will be approved will likely be made by the PDUFA date of December 30th. In a statement, David Didd, CEO at AEZS, had the following to offer:

We remain confident that the FDA will approve our NDA and, therefore, we are moving forward with our preparations to launch the product in the first quarter of 2018.”




Maxim Group Upgrade

As if the FDA news wasn’t good enough, AEZS also received great news from Maxim Group. The analyst firm increased the price target on the stock from $2.00 per share to $4.00 per share, maintaining their buy rating.

The FDA news was a big part of this upgrade. If Macrilen is approved for growth hormone deficiency in adults, the stock could see some incredible action, as the treatment will provide increased value. The analyst points out that the only test used for AGHD is an insulin tolerance test, but is very difficult to perform and comes with significant risks to the patient. However, Macrilen is a safer test and can be repeated with accuracy multiple times. As a result, the analyst believes that “Macrilen could become the new standard for addressing AGHD and rapidly adopted by physicians.”

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What We’ll Be Watching For Ahead

Moving forward, the CNA Finance team will be keeping a close eye on AEZS. In particular, we’re interested in following the NDA to see of Macrilen is indeed approved. If so, it could become the goose that lays the golden egg for the company and its shareholders. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!

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Thought Leader Discussions

Gevo, Inc. GEVO Stock News

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Gevo, Inc. (NASDAQ: GEVO) Before we get into this interview, I'd like to extend a special thanks to my friend Joey who both set up the...