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Osmotica: A Tough Story

Apr. 01, 2021 5:58 AM ETRVL Pharmaceuticals plc (RVLP)8 Comments
Out of Ignorance profile picture
Out of Ignorance


  • Osmotica closed its fourth quarter and full-year 2020 with dropping revenues.
  • It looks as if another clinical trial will be required to refloat arbaclofen ER.
  • Osmotica has signaled its interest in a strategic deal but has been reticent as to the form it might take.
  • Upneeq is Osmotica's one bright hope; whether it can support a positive value proposition for shareholders is highly uncertain.
Light coming into prison, giving hope
Photo by jeangill/iStock via Getty Images

Osmotica (OSMT) is best characterized as a stock in transition. As such, it requires careful monitoring.

This article reviews Osmotica's recently closed Q4, 2020 earnings. Its situation is dark, with its future prospects resting on the unproven shoulders of its recently launched Upneeq

This article was written by

Out of Ignorance profile picture
Writing under the pseudonym "out of ignorance", I very much regard investing as a learning process. Investing failures are tuition paid. Investing successes enter the trove of lessons learned. In my Seeking Alpha articles I share my experience from decades of investing and from ~5 years of focused research on a variety of stocks, in recent years with a primary emphasis on healthcare stocks. I greatly appreciate those who take the time to share their reactions to articles, particularly those who share relevant anecdotes and experiences.

Analyst’s Disclosure: I am/we are long OSMT. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

I may buy or sell shares in any stock mentioned over the next 72 hours.

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Comments (8)

Out of Ignorance profile picture
On this news I sold a third of my position. I hope to buy back and add on dips as the UPNEEQ story takes center stage.
theredbaron8888 profile picture
Anaconda Steel profile picture
IMO: (1) would have waited to publish this until after earnings call to integrate more balanced perspective, most of your concerns were addressed, (2) feels like a conflict of interest (for you) to report on this company if you are a potential patient - doesn’t mean you can’t express your opinions, but loses some credibility with your bias towards self pay.

Either way, the market will speak for itself on UpNeeq, good luck
Out of Ignorance profile picture
@Anaconda Steel
Thank you for reading and commenting. I read the earnings transcript assiduously, before writing the article, as is my custom. Indeed I quoted from Osmotica's 2021 10-K and its earnings release in the article. I agree wholeheartedly with your closing sentiment, "Either way, the market will speak for itself on UpNeeq, good luck". Today the market seems to be saying Upneeq is the bees' knees, which will plump my tiny holdings, perhaps enough so that I can buy some Upneeq. That might really open my eyes.
Why don’t they move into the aesthetic market sooner and more aggressively? They should be bombarding the dermatologist offices. This is going to be primarily a drug for aesthetics, especially given the cash pay nature of their model. People don’t mind paying up to look good. I can see this as part of a “hangover regimen”, too. Get some social media buzz around that and they could be booming with folks of all ages.
Out of Ignorance profile picture
They are trying to feel their way, to see what works. I like your approach. If they could get the right spokesperson, this could be big. Maybe they will figure something out in their strategy sessions.
Conviction Capital Research profile picture
@GatsbyRich forget dermatologists, they should be taking this to people with lasers/injectables practices... those guys can sell a ton of aesthetics, see botox, latisse, etc etc.
Out of Ignorance profile picture
@Conviction Capital Research
The drug has great potential. Let's hope they use all viable avenues to expand its reach.
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