Opexa Therapeutics A Significant Growth Opportunity For Both Short Term
Scott Matusow | Mar 27, 2013 05:33AM ET
As regenerative medicine continues to slowly bridge the gap between its future promise and the scientific reality of today, companies in the space are positioning themselves to benefit from the world's technological advances.
Today, regenerative medicine is becoming a reality while companies, researchers, patients, and investors alike also face ethical and religious questions to be answered. Important steps along those lines figure to be taken next month, as the Vatican prepares for its Second International Vatican Adult Stem Cell Conference: Regenerative Medicine — A Fundamental Shift in Science & Culture, taking place from within The Vatican, April 11-13.
$3.25M private placement and the upfront fee of $5.0M received from Merck Serono has helped temper that concern for Opexa. With a current monthly burn rate of only $885K, the cash position has been shored up considerably. The potential of a $15M to $25M fee from Merck Serono coming at the conclusion of the current phase 2b trial along with Merck Serono shouldering the burden of additional clinical development of Tcelna for MS, goes a long way in clearing up the cash worry for current Opexa shareholders.
Conclusion
Trading shares of small float biotech companies is certainly not a risk-averse endeavor, and the proper risk/reward allocation is a crucial component to any successful portfolio. Having said that, the developmental biotech space is where investors can find returns similar to Sarepta Therapeutics (SRPT). Sarepta traded under $3.00 a year ago as it worked through a phase II trial for eteplirsen, indicated for the treatment of Duchenne Muscular Dystrophy (DMD). It now trades now at over $32 a share while the company expects to hear from the FDA on accelerated approval for eteplirsen soon.
It is my opinion that Opexa Therapeutics presents both a high probability swing trade as well as considerable upside potential for the long term investor. The company is due to release its quarterly 10K Wednesday morning at 7:30. With only 8.5M shares outstanding, and an undervalued market cap of only 17.3M, a positive news announcement could send shares of Opexa surging quite a bit higher.
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