Recro Pharma (REPH) Stock: Gaining On Restructuring News

Recro Pharma Inc (NASDAQ: REPH) is having a great day in the market today, and for good reason. The company announced that it is restructuring its Acute Care Segment.

As you could imagine, the restructuring news excited investors, sending the stock screaming for the top. Today, we’ll talk about:

  • The restructuring news;
  • what we’re seeing from REPH stock as a result; and
  • what we’ll be watching for ahead.

REPH Announces Restructuring News

As mentioned above, Recro Pharma is having a great start to the trading session this morning after the company announced a restructuring initiative. The announcement was made via press release early this morning.

In the release, the company announced a restructuring initiative that will reduce the operating expenses associated with its Acute Care Segment. The initiative includes the reduction of about 50 employees.

In the release, REPH said that the initiative is expected to significantly lower operating expenses following the receipt of a second CRL from the US FDA regarding its NDA.

In the release, the company said that the headcount reduction will not affect the company’s CDMO Segment. Moreover, the company said that the CDMO Segment continues its strong performance, providing positive cash flow.

In a statement, Gerri Henwood, President and CEO at REPH, had the following to offer:

Recro Pharma has faced challenges while moving IV meloxicam through the regulatory process, making difficult decisions necessary to ensure shareholder value is preserved in the short term and can be built over the long term.

We continue to believe that IV meloxicam would be an attractive non-opioid pain management candidate for the hospital marketplace, and we believe it will ultimately be approved by FDA.

We sincerely thank those employees leaving the Company for their dedicated service. Following this restructuring, our resources will be laser-focused on growing the CDMO division, obtaining marketing approval for IV meloxicam from the FDA and securing a strategic commercialization partner.

What We’re Seeing From The Stock 

One of the first lessons that we learn when we start to dig into the market is that the news leads to mvoes. When it comes to Recro Pharma, the news proved to be incredibly positive.

After all, the restructuring will save the company money while allowing it to focus on core assets. So, it’s not surprising to see that excited investors are sending the stock on a run for the top.

As is just about always the case, our partners at Trade Ideas were the first to alert us to the gains. Currently (9:50), REPH is trading at $7.95 per share after a gain of $1.43 per share or 21.93% 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 close eye on REPH. In particular, we’re interested in following the story surrounding the company’s continued work to bring value to investors. Nonetheless, we’ll keep a close eye on the news and bring it to you as it breaks!

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