PhaseRx Inc (NASDAQ:PZRX)
PhaseRx Inc (NASDAQ:PZRX) stock is up over 15% in late-day trading after the biopharmaceutical company’s Board of Director’s approved a workforce reduction as part of a restructuring effort. PZRX shares hit a high of $1.89 earlier before sellers stepped in. Volumes have been heavy. PZRX shares are listed with a 30-day, daily volume figure of less than 65,000, but by 2:15PM almost 7 million shares have traded hands.
PZRX Stock Chart over the last two days:
PhaseRx Recent Developments
Less than a month ago, PhaseRx Inc (NASDAQ:PZRX) was touting the granting of an Orphan Drug Designation by the U.S. Food and Drug Administration (FDA) for its candidate drug PRX-ASL. PRX-ASL is being developed as a potential treatment for argininosuccinate lyase deficiency (ALSD). ASLD is a rare liver disorder caused by an inherited single-gene deficiency that results in elevated ammonia in the blood and can lead to irreversible neurological impairment, coma, and death.
The FDA grants orphan drug designation to investigational drugs that are being developed for the treatment of rare diseases that affect fewer than 200,000 people in the U.S. The designation of “Orphan Drug” is used to help the drug developers, including assistance with clinical study design and drug development, and providing tax credits for certain clinical trial expenses, exemptions from certain FDA application fees, and seven years of market exclusivity upon regulatory product approval.
PhaseRx Cost Cutting Ahead
The decision to restructure PhaseRx Inc (NASDAQ:PZRX) is aimed to reduce short term operating costs and delay the development of its lead product candidate PRX-OTC. The restructuring will include a 50% workforce reduction. The moves are being made to extend the life of the company as it seeks further alternatives that could include a merger or sale. As of June 30, 2017, PhaseRx had cash and equivalents of $8.4 million and a total of 20 employees.
PZRX stock has been in a downward trend since February. Its 52-week high was $3.30 and its low, achieved in late September, was $0.54. Since then the stock has experienced a bit of a rebound. However, investors in PhaseRx Inc (NASDAQ:PZRX) are apparently not keen to fully buy into the restructuring as PZRX shares are trading below today’s opening levels.
I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.
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About the author: Marc has a degree in economics and a MSc. in Finance. Over his 20-year career, Marc has worked for global investment firms in Europe and the United States as an analyst, fund manager, and consultant.