There have been multiple news contributions, investor actions, and great stock price volatility regarding the FDA granting Humanitarian Use Device Designation (HUD), to InVivo Therapeutics' (NVIV.OB) lead biopolymer scaffolding product for patients with spinal cord injuries - an as yet uncharted treatment area in the medical community. InVivo, based in Cambridge, Massachusetts, is on the verge of the first human clinical pilot study to treat spinal cord injury patients with thoracic injuries.
Some history for review includes the fact that InVivo's IPO price in late 2010 was $2.60 per share. It is now floating at $2.00 after a downward run of late, and slight recovery. The company filed an FDA request for Humanitarian Use Device designation on December 14, 2012 and announced it (via press release) with an expectation of a mid-January feedback date, this being an approximate 45-day turnaround, rather the norm by standards of FDA history. But the 45-day turnaround came and went with no news, and the expected catalyst hope was defeated along the way. As with many expected catalysts, a run up occurred, as well as a strong downturn upon the disappointment. Swings from $2.59 to $1.60 were apparent.
So the questions going forward are: is there a problem that the FDA has with the submission, or is there just a delay? Subsequently, is there a real catalyst opportunity associated with the FDA designation or not?
Some analysts have suggested that the review period just got reset to an additional 45 days due to internal FDA guidance issues associated with Humanitarian Use Device Designations (report), and that an early March response is feasible, perhaps even March 9th. So did the FDA ruin the InVivo catalyst event and was this unfair to InVivo? The answer is that inside the FDA, the subject of a company's stock price, catalysts, and PR is not on the minds of the examiners - only the validity of the science, products' efficacy, and safety is.
Trading at a current $2.12, with a 52-week range of $1.25 - $2.74, and a market cap of $140 million, an uptick opportunity seems realistic, perhaps a take II of the first catalyst opportunity. The risk of course is that the FDA has negative news and the delay has nothing to do with a new guidance agenda. The upside of that risk is that the designation comes through and the price reacts accordingly with the good news. The company CEO believes the science and the product is solid.
Of late, the company has submitted an updated Investigational Device Exemption to the FDA requesting permission to begin human studies in order to test its biopolymer scaffolding for the treatment of acute SCI.
Now is the time to pay attention to InVivo.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.