Fennec Pharma stock plunges to all-time low

Fennec Pharmaceuticals Inc. (FENC) stock plunged to an all-time low of $4.69 on Tuesday. Investors were concerned about the future of the biotechnology company due to the delay of its lead candidate that will prevent hearing damage in pediatric cancer patients receiving platinum-based chemotherapy. Also, they were unsatisfied with the recent fourth-quarter results.

Traders believed the stock to regain its value in the future and termed it a good investment. Analysts recommended a “strong buy” or “buy” rating while expecting the stock to reach $17.75 per share in the next 52 weeks. They believed the company could shine in the future as Fennec has started preparing for the lead candidate marketing application submission.

However, the company has delayed the filing of new drug application for its lead candidate, Pedmark, with the full submission now targeted for late 2019 to early 2020. Pedmark, if approved, is expected to make the first commercial launch in the second half of 2020. The company cited that the drug substance manufacturer for Pedmark was recently acquired requiring a site transition for the commercial manufacturing site.

In February 2019, Fennec secured a $12.5 million debt financing with Bridge Bank to support a potential commercial launch. The company expects its cash position of $22.8 million as of December 31, 2018, combined with the $12.5 million debt to be sufficient to fund Pedmark commercial launch.

For the fourth quarter, the company reported a wider loss due to higher research and development expenses. The increase in R&D expenses was primarily due to the manufacturing and regulatory expenses associated with the preparation for regulatory approval and planned commercialization of Pedmark. General and administrative expenses declined 12.5% on a small decrease in non-cash equity compensation.

Meanwhile, analysts believed that the company’s Pedmark product faces no competition for years in an orphan market as it will be the first of a kind to prevent hearing damage in pediatric cancer patients receiving platinum-based chemo.

Shares of Fennec opened lower on Tuesday and is trading in the red territory. The stock has fallen over 56% in the past year and over 22% in the past three months.

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