Cempra Inc. (CEMP) is in clinical trials with solithromycin [CEM-101], which I think is the most important antibiotic to come along in a while. It will hit the market within a short period of time.
Solithromycin has proven itself repeatedly. It's in Phase 3 studies for oral and intravenous use for community-acquired bacterial pneumonia. Solithromycin is being tested as a step-down therapeutic, which means the same drug can be used in an oral or intravenous form. It is a money-saver for the healthcare system. A patient could come to the emergency room with a dangerous infection, be treated intravenously, and then be released once the infection is under control with the oral dose, rather than being admitted for several days to receive periodic intravenous medication. Cempra also is the beneficiary of BARDA funding. I like Cempra's technology very much, and the company has more than one antibiotic in development. It has a Phase 2 candidate, Taksta [fusidic acid], in acute and chronic methicillin-resistant staphylococcus aureus [MRSA] infections and prosthetic joint infections.
Cempra is not only fully committed to developing antibiotics, it also has the ability to do it by itself. It is a strong company and has been able to attract partners from around the world. I believe that Cempra is primed to deliver. For full disclosure, we did act as a financial advisor on one of its transactions.
Undervalued at current level
Hi skipper. Thanks for the sales figures and info. What is your opinion on DSC127? I havent had the time to read the the clinical trial info yet (final exams this week). I did see their investor presentation and the info on there looked promising.
Lets start out with what they have:
As of Sept 30, 2013
$5M cash + $20M short term investments = $25M total
What they burn per quarter: ~ $5M
So lets revise what they have: ~$20M right now
They dont anticipate completion of P3 until 2Q 2015. $20M cannot last this long. Another large issue is they said themselves they are ramping up the P3 trial and it will cost more money (I wouldnt be surprised to see a 50-100% increase in costs). They were having trouble with enrollment, so im sure they will be spitting out the $$ to try and catch up. Once they do complete the trial, there will be regulatory costs for NDA filing and then more costs for sales reps.
The $75M shelf is a precursor to an offering. IMO they need the whole $75M to avoid any further dilution from now until PDUFA date.
Zacks uses a computer software program which automatically gathers a bunch of irrelevant data points then spits out a buy/sell/hold rating. There is no human analyzing the stock. To say the least.. their ratings are horrid.