Will These Biotech Penny Stocks Continue to See Bullish Momentum?
In the past twelve months, biotech penny stocks have risen to fame alongside the coronavirus pandemic. While we have seen case numbers vary in severity, investor interest in biotech stocks continues rising. Yes, there is still a lot of volatility surrounding biotech companies that are working on virus-related treatments. Still, there is also plenty of attention focused on other health indications too.
As of February 1st, the U.S. saw case numbers decline. In only two weeks, the number of new cases reported daily has shot down by more than half to around 111,000 as of January 31st. So, as case numbers decline, investors are curious about what will happen to biotech companies that work on a covid treatment and those that do not. The short answer is that it is difficult to tell in the short term.
But, in the mid-term, it looks like the treatments that these companies are producing are still in high demand. Also, while dropping covid cases are without a doubt exciting, we are in no way out of the woods. Vaccine distribution is still much lower than it needs to be, marked by logistical challenges and individual needs to receive a second dose.
During the pandemic, the focus on biotech companies has only continued to increase. And, it doesn’t seem like investors will lose interest anytime soon. So with that in mind, now’s the time to find potentially valuable biotech penny stocks to watch. All things considered, here are four that you may want to put on your watchlist.
Biotech Penny Stocks to Watch
- Atossa Therapeutics Inc. (NASDAQ: ATOS)
- Corbus Pharmaceuticals Holdings Inc. (NASDAQ: CRBP)
- Novan Inc. (NASDAQ: NOVN)
- Oragenics Inc. (NYSE OGEN)
Atossa Therapeutics Inc.
Up by over 18% for the day on February 1st is ATOS stock. We’ve covered Atossa Therapeutics several times in the past few months. This is due to its recent focus on producing treatments for Covid-19 and its other endeavors. The company is currently in the development of a drug known as AT-301. This is a substance used nasally for the treatment of Covid-19. To date, there are no FDA-approved treatments for coronavirus that can be taken in the comfort of one’s home. With this, we begin to see how large of a market opportunity this is for Atossa. The company recently completed its Phase 1 clinical study and is now working on receiving broader FDA approval.
The company states that it is working with Covid-test producers to symbiotically diagnose and treat coronavirus in a short period of time. While AT-301 is not a be all end all treatment, it is showing efficacy in reducing hospitalizations. Obviously, it is too early to make a definitive statement on the potential of AT-301, but the news continues to be promising. At the end of January, the company announced that it received roughly $21 million from the recent exercising of outstanding warrants.
Kyle Guse, CFO of the company stated that “in the past 60 days, we have made great progress in adding substantial cash resources so that we can accelerate development of our Covid-19 and great cancer therapies. We completed financings with gross proceeds of approximately $60 million and in the past week have added an additional $21 million to our balance sheet.”
Corbus Pharmaceuticals Holdings Inc.
CRBP stock is one of the bigger gainers of the day, pulling in roughly 40% by EOD on February 1st. Shares sat around $2.70 during after-hours trading. While no news came out during the trading day, we can examine CRBP’s business model to hypothesize why it has shot up so much today. The company is a clinical-stage pharmaceutical business with a focus on treating rare and chronic diseases. This includes both inflammatory and fibrotic diseases, where it is working on several novel compounds. The company’s lead product is known as lenabasum, which is an endocannabinoid based drug used in the treatment of systemic sclerosis.
One of the things that have made Corbus popular in the past few years is its focus on utilizing the endocannabinoid system to produce its drugs. This is the system in the body that recognizes cannabis and its varying compounds. While it isn’t necessarily a marijuana stock, Corbus has earned a position in the cannabis industry.
On February 1st, many marijuana stocks like Tilray Inc. (NASDAQ: TLRY) and Charlotte’s Web Holdings Inc. (OTC: CWBHF) shot up in value. Also, many biotech penny stocks saw bullish sentiment during the trading day. Because Corbus fits into both of these categories, this rise could be attributed to its correlation with these industries. With this in mind, is CRBP worth watching?
Novan Inc. is another penny stock that we’ve discussed many times in the past few months. While it isn’t working to create a new drug to treat covid, one of its existing substances could affect the pandemic. The company produces its proprietary nitric oxide-based tech platform known as Nitricil, which has many indications for dermatologic conditions and demonstrates efficacy as an antiviral for covid. A few months ago, the company demonstrated the first antiviral effects of nitricil on Covid-19 infections. The company states that this could be a new way to treat the coronavirus in patients. While results from recent studies are still pending, this substance is showing efficacy in early research.
Also, the company’s leading product is known as SB206. This compound is an antiviral gel used to treat molluscum contagiosum, a common skin infection. This affliction targets more than six million people per year in the U.S. alone, most of those being children. There are no FDA-approved treatments for molluscum, which is surprising considering how many people suffer from it each year.
Because of this, Novan sees a large market opportunity in producing SB206 for use in these patients. On February 1st, the company announced the completion of enrollment in the B-SIMPLE4 Phase III study of SB206. This is a big deal, as enrollment can often take quite a long time. Now that it is ready to start the trial, the roadmap could become clearer for investors. With these exciting updates considered, is NOVN a penny stock to watch?
Oragenics Inc. comes in as another company we’ve been discussing for quite some time. While the company usually works in several medical fields as a pharmaceutical business, it is currently focused on creating a vaccine for Covid-19. Its vaccine candidate, known as Terra CoV-2, is a joint effort between it and Adjuvance Technologies Inc. Oragenics originally developed the vaccine. Still, they later found that adding Adjuvance Technologies TQL1055 adjuvant greatly increases the vaccine’s stability and manufacturing efficiency. This led to a material transfer agreement between the two companies that was announced earlier in January.
In the announcement, Oragenics stated that it would use the adjuvant in pre-clinical animal studies that should be conducted during the first quarter of this year. Human trials are set to begin in the latter part of 2021. Alan Joslyn, CEO of Oragenics, stated that “the execution of this material transfer agreement is an important step in the ongoing development of our Terra CoV-2 vaccine. Access to TQL1055 will permit us to generate the data necessary to continue development of the vaccine along our currently expected timelines.”
Because it is working on a covid vaccine, OGEN stock is more volatile than many other biotech penny stocks. But, volatility can often be desirable for certain traders. Whether or not this info makes OGEN a penny stock to watch is up to you.