Tetraphase won't trade with a market cap of $100m or they will be acquired. $189m in cash, no debt on the balance sheet. Biotech's that have a reasonable shot at getting FDA approval trade at $300m market cap or more. There's about 300% upside from here to Q4 2017, price target $12. Acquisition price $15. Watch the insider buying start.
Here's my view:
- Eravacycline works, that's already been demonstrated in multiple trials.
- There is a public health crisis with multi drug resistant pathogens.
- Data at ECCMID last month demonstrated excellent MIC against numerous carbapenem-resistant strains of gram-negative bacteria.
- They have $189m cash, and a market cap of $109 million based on after hours trades.
Today's announcement removes all uncertainly from TTPH. I suspect you'll see insider buying at these levels. I will be buying at anything under $4.
You don't trade below cash value when you have Phase 3 drug that's already been shown to work. Approval at this point is a formality. Sales would be swift as well, there's a huge unmet need for next generation antibiotics.