Check this out from Seeking Alpha:
https://www.google.com/amp/s/seekingalpha.com/amp/article/4133495-2-small-biopharma-ceos-sacked
"I refer, of course, to Egalet (EGLT). It is hard to imagine a company that has done a better job of destroying shareholder value here in 2017 as the chart below shows.
The company's primary drug candidate ARYMO ER was approved earlier this year. Egalet has had some success in ramping sales. ARYMO ER went from 1,124 prescriptions in the second quarter of 2017 to 2,630 prescriptions in the third quarter. The company also garnered market access with a large payer as it added ARYMO ER to its Medicare Part D formulary during the quarter.
Last week the company announced that the FDA has tentatively approved new labeling for ARYMO ER. In recent months, the company has also delivered several positive trial results (I, II,). The company enjoys positive if sparse analyst coverage with Cantor Fitzgerald reiterating the shares as a Buy with a $7 price target last week.
Despite this the stock has lost some 85% of its value this year and now has a market capitalization of just ~$45 million. Part of this is the continuing disappointment that ARYMO ER will have a smaller potential market in pain management than was believed a year ago and the compound did not get initially the labeling the company was hoping for. Management has done a poor job communicating that this niche could still be lucrative (especially against the current valuation of the company) and with its success ramping up scripts.
In addition, I don't think investors have full confidence in the company's ability to manage its balance sheet. Yesterday, Egalet announced a deal that will reduce its total principal amount of debt outstanding will be reduced to from $61 million to $48.5 million. However, the company is issuing a significant amount of warrants within the transaction and will also issue some $23.5 million of new debt with a slightly higher coupon. This transaction is a bit perplexing given the stock is trading near all-time lows and the company reported it had cash on hand just in excess of $100 million during its third quarter earnings report. Egalet did another dilutive capital raise in the second quarter as well.
I continue to hold (but I am not adding to) both stocks as I think both are significantly undervalued given their underlying assets and prospects. That being said, I would feel much better about my stakes if both CEOs were given their 'walking papers' and new, more credible leadership was brought into both companies."
https://www.google.com/amp/s/seekingalpha.com/amp/article/4133495-2-small-biopharma-ceos-sacked
"I refer, of course, to Egalet (EGLT). It is hard to imagine a company that has done a better job of destroying shareholder value here in 2017 as the chart below shows.
The company's primary drug candidate ARYMO ER was approved earlier this year. Egalet has had some success in ramping sales. ARYMO ER went from 1,124 prescriptions in the second quarter of 2017 to 2,630 prescriptions in the third quarter. The company also garnered market access with a large payer as it added ARYMO ER to its Medicare Part D formulary during the quarter.
Last week the company announced that the FDA has tentatively approved new labeling for ARYMO ER. In recent months, the company has also delivered several positive trial results (I, II,). The company enjoys positive if sparse analyst coverage with Cantor Fitzgerald reiterating the shares as a Buy with a $7 price target last week.
Despite this the stock has lost some 85% of its value this year and now has a market capitalization of just ~$45 million. Part of this is the continuing disappointment that ARYMO ER will have a smaller potential market in pain management than was believed a year ago and the compound did not get initially the labeling the company was hoping for. Management has done a poor job communicating that this niche could still be lucrative (especially against the current valuation of the company) and with its success ramping up scripts.
In addition, I don't think investors have full confidence in the company's ability to manage its balance sheet. Yesterday, Egalet announced a deal that will reduce its total principal amount of debt outstanding will be reduced to from $61 million to $48.5 million. However, the company is issuing a significant amount of warrants within the transaction and will also issue some $23.5 million of new debt with a slightly higher coupon. This transaction is a bit perplexing given the stock is trading near all-time lows and the company reported it had cash on hand just in excess of $100 million during its third quarter earnings report. Egalet did another dilutive capital raise in the second quarter as well.
I continue to hold (but I am not adding to) both stocks as I think both are significantly undervalued given their underlying assets and prospects. That being said, I would feel much better about my stakes if both CEOs were given their 'walking papers' and new, more credible leadership was brought into both companies."
