Why Shares of Cleveland Biolabs Inc. (NASDAQ:CBLI) Exploded

Cleveland Biolabs Inc. (NASDAQ:CBLI)

The last six months have seen shares of nano-cap Cleveland Biolabs Inc. (NASDAQ:CBLI) generally find, on thin volumes, support around $1.50 and meet resistance at $2.00. After closing at $1.56 on Friday, shares of CBLI gapped up to open at $2.05 and reach and inter-day high of $3.09 – nearly doubling the value of CBLI shares from Friday’s close. Shares then dropped back to around $2.75 just after noon EST. Volumes have been extraordinary. The shares of CBLI have an average daily volume figure of just under 39,000. However, by 12:40 PM EST over 21 million shares had traded hands.

The market seems motivated by two announcements released today by Cleveland Biolabs Inc. (NASDAQ:CBLI) that both deal with their lead drug candidate Entolimod. Entolimod is a drug being developed as a treatment to counter the effects of Acute Radiation Syndrome (ARS). ARS is also known as radiation poisoning, radiation sickness, or radiation toxicity. The effects of ARS typically are present within one day of exposure to high amounts of ionizing radiation such as are present in Gamma rays, X-rays, and the higher ultraviolet portion of the electromagnetic spectrum. Consequently, Entolimod has potential applications for victims of nuclear attack or patients undergoing radiation therapy.

The first announcement from Cleveland Biolabs Inc. (NASDAQ:CBLI) revealed that the European Medicines Agency accepted the company’s pediatric investigation plan (PIP). This opens the door for Cleveland Biolabs to submit a Marketing Authorization Application (MAA) for Entolimod to be utilized as a medical radiation countermeasure in children undergoing radiation therapy. The PIP’s future efforts will be deferred until the MAA is submitted.

Concurrently, Cleveland Biolabs Inc. (NASDAQ:CBLI) also announced that the U.S. Food and Drug Administration (FDA) completed its analysis of two formulations of Entolimod. Based on the results, the FDA has consented to allow Cleveland Biolabs Inc. (NASDAQ:CBLI) to begin an in vivo biocomparability study of the two formulations in non-human primates. The biocomparability study will be funded, in part, by the Department of Defense’s Joint Warfighter Medical Research Program.

In 2002, the FDA published the Animal Rule. This allows approval of certain therapies that have a goal of reducing or preventing serious life-threatening conditions based on the safety results in a trial of healthy subjects in addition to effectiveness in appropriate animal studies in cases where efficacy studies using human subjects is not possible. Studies using Entolimod in animals have demonstrated efficacy in animals with overall survival rates improving against a control group.

Buffalo, NY-based Cleveland Biolabs Inc. (NASDAQ:CBLI) develops and commercializes therapies for use in oncology and radiation countermeasures. Cleveland Biolabs also conducts business in the Russian Federation through a wholly owned subsidiary named BioLab 612, LLC and is involved there in a joint venture with Rusnano, Panacela Labs, Inc. Cleveland Biolabs Inc. (NASDAQ:CBLI) has relationships with both the Cleveland Clinic and the Roswell Park Cancer Institute.

4/17/2017
Ticker Symbol CBLI
Last Price a/o 1:24 PM EST  $                      3.08
Average Volume                      38,990
Market Cap (mlns)  $                    17.10
Sales (mlns) $3.50
Shares Outstanding (mlns) 10.96
Share Float (mlns) 4.42
Shortable Yes
Optionable No
Inside Ownership 3.83%
Short Float 0.41%
Short Interest Ratio 0.47
Quarterly Return -2.34%
YTD Return 9.86%
Year Return -36.33%

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

About the author: James Marion is a University of Houston student studying Business with a concentration in Finance.

Author: James Marion

James Marion is a University of Houston student studying Business with a concentration in Finance. James has interned with several investment professionals and hopes to pursue a career as a professional stock analyst after graduation.

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