Titan Pharmaceuticals: Another Step in the Recovery Process

Apr.29.10 | About: Titan Pharmaceuticals, (TTNP)

Titan Pharmaceuticals (NASDAQ:TTNP) announced on Tuesday that the SEC has completed the review of the company's "Form 10 for the re-registration of the company's securities and resumption of its reporting obligations under the Securities Exchange Act of 1934."

Titan intends to remain a reporting company from this point forward, according to recent releases from the company.

The completed review brings Titan one step closer to moving the company's trading shares to the OTCBB from the pinks, adding another level of validity to a company that has recovered from the brink of disaster over the past year.

In other company news, the San Francisco Business Times has reported that Titan will look to resell 9.7 million shares for fourteen of the company's shareholders - including First Eagle Investment Management LLC, the company's largest shareholder.

Let's emphasize the fact that Titan is RESELLING these shares for existing shareholders, according to the text of the SF Business Times piece; the title of the article is misleading by stating that Titan is selling 9.7 million shares. Investors could look at the title and think dilution, when that is not the case.

Dilution can come in the form of exercised warrants, however. As mentioned in the SFBT article, Titan can receive up to $12.4 million from exercised warrants, which would dilute the stock just a tad over ten percent, but the fact that the stock would need to be over $2 for those warrants to be exercised could be construed as a positive for existing and potential shareholders.

Cash in the bank makes Titan a stronger company and a stronger company is more attractive to any potential acquiring company that may have eyes on Titan right now.

The existing cash on hand, NIH grant and future Fanapt royalties has Titan set up nicely for 2010, and future Fanapt royalties should enable Titan to conduct business as normal through the Probuphine filing, in my opinion, decreasing the possibilities of a need to raise additional funds by dilution.

Those that sold some shares in the mid-$2 range are looking at an attractive price to reload, in my opinion.

Disclosure: Long TTNP.