Midatech Pharma PLC-ADR (NASDAQ: MTP) is having an overwhelmingly strong start to the trading session this morning after announcing that it has entered into a key agreement, opening the door to millions of dollars in financing. Today, we’ll talk about that agreement, what we’re seeing from the stock, and what we’ll be watching for with regard to MTP ahead.
MTP Gains On Agreement
As mentioned above, Midatech Pharma is having an incredibly strong start to the investing year after announcing that it has entered into an agreement that opens the door to financing. According to a press release offered by the company early this morning, MTP has entered into a four-year senior secured loan agreement with MidCap Financial. Under the terms of the agreement, a credit facility of up to $15 million has been opened to the company.
In the announcement, MTP said that it has already received an initial tranche of $7 million. In the future, further tranches will be issued under the credit facility and will be dependent on clinical development milestones set in place surrounding MTD201 and MTX110. The company said that it intends to use the funds to support further progression toward these and other value-driving product milestones. In a statement, Dr. Jim Phillips, CEO at MTP, had the following to offer:
“This agreement allows us to continue the clinical development of key products. With the extensive due diligence that was required, it also indicates significant support in Midatech’s future. With our lead programmes heading towards potentially significant, value-driving inflection points in 2018, and the continued progress of our R&D pipeline and US commercial activities, this is an exciting time for the business.”
What We’re Seeing From The Stock
One thing that we learn quickly when we start to invest or trade is that the news moves the market. Any time positive news is released with regard to a publicly-traded company, we can expect to see gains. Well, the news released by Midatech Pharma was overwhelmingly positive, leading to massive gains in the value of the stock. At the moment (12:28), MTP is trading at $1.88 per share after a gain of $1.05 per share (124.40%) thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a very close eye on MTP. In particular, we’re interested in following the development of MTD201 and MTX110, as these potential products will likely present multiple strong catalysts throughout the year. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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