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Michael Sacerdote
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For my day job, I'm a resident physician in radiology, but the goal is to leverage that medical knowledge as a competitive advantage in the markets. I aim to include all of the following in my analyses to ensure high quality: 1) quantitative estimates; 2) new information or inferences that are... More
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  • Tonix: Shares Crater On Short Attention Spans

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    Several months ago, Joe Springer and I wrote about the extensive medical evidence underlying Tonix's (TNXP) pivotal BESTFIT trial studying sublingual cyclobenzaprine for fibromyalgia. We reviewed the avalanche of data supporting cyclobenzaprine's safety and efficacy accumulated during the drug's lengthy use in the clinic. In a frenzy of buying, the stock had a double peak of $20-$21, followed by a sustained plunge. Volume dried up. Commenters all but vanished from the message boards, except for a few lonely crickets chirping through the sad end of autumn. What happened?

    Aside from a secondary offering at $15 that netted the company $40 million to advance its clinical trials, not much. Around 2% of the population still has fibromyalgia. The BESTFIT trial moves forward on schedule. There has been no change in the expected date of topline results late in the year. The company's star CEO, Seth Lederman, remains at the helm and committed to the cause. No insider sales have taken place. The company is advancing enantiopure isometheptene for the treatment of tension-type headaches, having recently held a pre-IND meeting with the FDA. Occasional press releases confirm that at least some of the bodies in the corporate office are still warm.

    I can only conclude that the price collapse relates to the fickle ways of the stock market. Current fibromyalgia medications, which offer only meager relief of systems, have a market of $1.5 billion. If Tonix achieves only a 5-10% market share, the stock price could easily double or triple. While the company takes care of the decidedly unsexy work involved in running a blinded trial, bored shareholders who need a catalyst every day of the week have dumped their shares at fire-sale prices. I thought the company was cheap at $16; it hasn't become expensive at less than $12.

    Disclosure: I am long TNXP.

    Additional disclosure: Rely on your own due diligence for all of your investment decisions.

    Tags: TNXP
    Mar 13 9:59 PM | Link | 7 Comments
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