Synergy Pharmaceuticals Inc (NASDAQ: SGYP)
Synergy Pharmaceuticals, like most publicly-traded companies, is having an incredibly hard time in the market. The reason for the declines is very simple. Recently, the consumers of the UK voted to leave the European Union. This is causing major concerns with regard to global economic conditions. As a result, the global market is declining in a big way. Nonetheless, I believe that this is creating a compelling opportunity surrounding SGYP. Today, we’ll talk about why the stock is headed upward in the long run.
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The Key To SGYP Is Plecanatide
If you really want to understand where the value in Synergy Pharmaceuticals is, just look at plecanatide. Plecanatide is a treatment that the company has been working on for some time. It is designed to treat conditions associated with the gastrointestinal tract.
The good news is that we’re not in the beginning of the production here. In fact, SGYP has already submitted a New Drug Application with the United States Food and Drug Administration for plecanatide. The application was submitted for the indication of chronic idiopathic constipation. I’ve been following the company for some time, including their clinical trials. After seeing the strong results presented through the clinical trials, it’s hard to imagine that the FDA would decline the treatment. The results of the clinical trials proved to be overwhelmingly promising in all clinical studies. The FDA is expected to make its decision with regard to this indication by no later than January.
The second indication that the company is working on is in full swing as well. In recent studies, plecanatide has been proven to be effective in the treatment of irritable bowel syndrome with constipation, also known as IBS-C.
Currently, SGYP is in the midst of two Phase 3 studies looking into plecanatide as a treatment for IBS-C. Previous studies have shown overwhelmingly promising results, so, it’s hard to imagine that we would see anything different from the results of the Phase 3 studies.
Primed For Acquisition
Another thing that we have to keep in mind here is that, at the moment, SGYP is ripe for the picking when it comes to acquisitions. In fact, several companies in the biotechnology space are likely looking into acquiring Synergy at the moment.
We know for a fact that Allergan has an interest in the acquisition. This was made clear when the company said that it was in talks with SGYP with regard to an acquisition recently. While it seems as though those talks have fallen through, there is tremendous value here – especially for a company that’s willing to acquire Synergy. After all, the company has a NDA waiting for approval with the FDA and is in late-stage studies that will likely lead to another NDA. Of course, if an acquisition does happen, it will likely send SGYP soaring!
The bottom line is that there is a great opportunity here. No matter where you look, if you’re looking at SGYP, chances are that you’re seeing great things. While current market conditions are horrible to say the least, declines won’t last forever. When the market starts to recover, we’re likely to see big gains in SGYP. So, watching the stock closely and waiting for the right entrance time will likely prove to be overwhelmingly profitable.
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What Do You Think?
Where do you think SGYP is headed moving forward and why? Join the discussion at TalkTRENDZ from CNA Finance!
[Image Courtesy of Pixabay]