As you said, long is relative. The time frame for approval is short compared to cancer drugs, but it's long compared to how far CEMP (or some of the other stocks this has been compared to) has to go. Those entered phase one 3 or 4 years ago, this has a similar time frame.
Don't get me wrong, I'm long CFRX and believe they will move up significantly, I just think it's going to take a couple of years. For now, I'll open a position and, if the science progresses reasonably, add over time.
There is the little matter of demonstrating safety, efficacy, getting approvals, etc.. They still have a long way to go.
I would agree a takeover is likely. I look at the take over valuations of Trius, Optimer and Durata as similar values. Those all went in the six to eight hundred million dollar range. I expect an eventual similar valuation for Achaogen
And cemp has a 1.5 billion plus market cap. AKAO has 120-130 million. I don't expect AKAO to get anywhere near CEMP's market cap, but it's not unreasonable to believe this is currently undervalued based on the potential of it's antibiotic. I'm hoping for a double, more or less, from here.
You are probably right that they will need a secondary. However, it won't be soon, and there will be catalysts before then. They have about 75-80 million in cash, and are burning about 20 million a year, so financing is inevitable. Before then there should be interim readouts, numerous presentations, and more stories in the news about antibiotic resistant bacteria. All of these should drive the price higher before the required secondary.
The $6 drop had nothing to do with this flying too high too fast, and everything to do with the IBB taking a hit. Absent the IBB droping almost 10%, this stock is in the upper 40's. When the IBB bounces back, this stock will break 50.
How can the chart be indicative of anything when this is moving because the whole IBB is cratering? Absent the IBB dropping nearly 4%, Cemp doesn't tank today.
I think they will need a phase 2b but they should make it large enough to qualify for expedited approval.
While they were fantastic results, due to the limited sample size, statistically, we can push them aside as a fluke. That's the whole point of tests with much larger samples, to make it impossible to push them aside.
I agree. It would be stupid to throw a large amount of money at such a speculative stock. And the results, while incredibly positive, are a very small sample size. However, it was enough for me to thrown some gambling money at this stock and see what happens. The drug clearly needs a much larger test phase 2B and phase 3 test.
The possibilities are fun to talk about though.
I know I'm going to regret this, but I took enough money out today so that I'm only holding shares I effectively didn't pay for. It's just a little to fast a climb for me and I need to preserve some capital.
We don't know for sure there is a super alz product. We know very little about the product as of right now. It has potential and is worth a speculative risk, but anything more than that is unknown as of right now.
Why would they do that? At their current burn rate, they have enough money for almost 2 years. They get close to finishing their trials with the money on hand before they need to raise. They will need to raise, but they will wait until they have created more value by completing more of the trials. When there is a raise, it will be at a higher share price.