Yesterday was not an exception. LPTN share price added another 16.25% and closed at $0.93. The stock is gaining more and more traders and the volume exceeded 214,000 shares traded, which is six times the average. With no news since the beginning of last month, the shares keep trading above their usual price channel.
It seems that the event that added nearly 73% to the market value of LPTN shares was an update from a month ago. It concerned the company’s product candidate iSONEP, for which encouraging clinical data have been presented. The market’s apparent belief in that product’s potential was also supported by management plans to further investigate the efficacy of iSONEP and eventually to target a market of $2 billion per year.
iSONEP is designed for the treatment of various ocular diseases and has successfully completed Phase I of its clinical trials. It is one of the three product candidates that LPTN is currently working on. The company has no marketable products yet and its revenues came so far from grants and from a collaborative agreement with Merck KgaA. That agreement was for LPTN’s cancer drug candidate ASONEP and has been terminated in March this year, which could prevent further fundamental support for the stock.
Additional funding for iSONEP Phase II trial will be provided from a received in July $3 million grant under a program by the National Eye Institute. Under another similar grant, awarded to the company in 2009, LPTN can receive another $2 million, but still additional funds will have to be raised by the end of this year. Otherwise, part of the planned research and development activities will have to be canceled.
That means possible dilution for LPTN current shareholders, which also may eventually stop the recent rise of the share price.
