After holding up very well against yet another ill-researched and most-likely short sponsored tabloid report, shares of Rexahn Pharmaceuticals (RNN) held up relatively well yesterday. Some of the weak hands were shaken by the ploy, as usual, but one simple fact remains the drug candidate, Serdaxin, is attracting possible buyers and partners who want the drug based on the results it is producing. As the company revealed last week, at least six big pharmas want the drug and are exploring options in which to partner with the company.
As I reported earlier, the millions of naked shorts are starting to buy back in to RNN. In addtion, there are several milestone payments and a forward looking news item next month that continue to push the stock price higher. In the opinion of many of us who follow the company, RNN is a $15 stock waiting to happen.
The company has stated that it has been receiving warrant exercise money and that they now have more than $10 million in cash. Keep in mind that they will also be receiving $3.5 million from Teva (TEVA) in June in a further private placement at 20% above the stock's market price. This is in addition to the $4 million in milestone payments that they'll get from Teva by year end.
Don't forget, also, that next month the company will have some important Zoraxel data to present and they believe they will make a deal with one of the six interested major pharmas for Serdaxin. As a matter of fact, sources anticipate that partnership for Serdaxin by year's end.
Given the choice between choosing who is telling the truth about whether the science and trials about the drug are real or not, I'll go with the CEO of the copany (who headed two departments at the FDA) instead of a tabloid reporter who is currently being sued by another company for misrepresenting facts on this one.
As I like to say, don't listen to the dips, buy on them.
Disclosure: Long RNN