Happy holidays from the PropThink editorial team! We hope you’re enjoying time with friends and family as we wrap up another busy holiday season and prepare for a new year. This week was an odd one with shortened (and missing) trading sessions, but we wanted to send out a final weekly recap touching on some of our top stories this past week.
One of Mr. King’s December recommendations was good for 30% in less than two weeks. Shares of Coronado Biosciences (CNDO) climbed drastically this Thursday during what was a thin day of trading for most equities. When CNDO announced the results of a small study of its lead product candidate, TSO, in Autism Spectrum Disorder earlier this month, we suggested to PropThink Premium subscribers going long the stock around $2.30 – mainly because CNDO traded well-below its cash value of $2.80 per share. CNDO traded as high as $3.09 in the Thursday session. We suspected traders would take CNDO higher through Friday, but the momentum never materialized and we closed our position short of the top. As we said in our original note, there are a myriad of reasons to doubt Coronado; nevertheless, the trade worked rather quickly and we’re content to be on the sidelines for now.
Endocyte (ECYT) disclosed a $50M At The Market financing arrangement on Monday. PropThink discussed ECYT at length here and here. Although we’re optimistic about the company’s drug candidates, we’re sitting tight as we await two inflectional events for ECYT, one of which should come before the end of January. Even if both events prove negative, ECYT has a three-year runway on the balance sheet, suggesting that the ATM is management positioning for quality outcomes in the next quarter, not an effort to raise money immediately. Click here to read the article.
On Tuesday it was brought to our attention that Progenics (PGNX) is enrolling patients in a new clinical trial of its lead oncology drug, PSMA ADC. The trial is an open-label extension of an ongoing phase 2 trial of the drug, which recently completed enrollment of the first of two planned cohorts, suggesting that patients in the first trial have been doing well: the extension essentially allows patients who are benefitting from PSMA ADC to continue receiving the experimental drug for 2-3x the amount of time they had been on treatment before. Overall the new trial is bullish for Progenics investors. We’ve been long PGNX for some time and our position is now well into the green. We suspect PGNX continues higher after consolidating next week, in advance of key trial results at the end of January. We’ve expressed to Premium subscribers some concern about the PSMA target, but continue to like the trade.
Titan Pharmaceuticals (TTNP) confirmed this week that the FDA would like to see a new study testing its lead product, Probuphine, as a treatment for opioid addiction. Jason Napodano has covered Titan for PropThink since before the company received a Complete Response Letter in the spring. Although this week’s news pushes the timeline back significantly, Probuphine is an approvable and compelling option for the treatment of opioid addiction. We’re curious to see where the company secures $5-10 million to enable operations through 2015, but will be highly interested in getting involved with TTNP following. At $0.60, the risk/reward is attractive, but we suggest waiting for the balance sheet to improve and for details on the new registration trial.
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Happy holidays!
In connection with PGNX and ECYT, PropThink has taken a long position.
