With penny stocks, high volatility can often be used as an asset. While buying penny stocks is not for everyone, the potential with stocks under $5 can be high. On the other hand, some investors will shy away from penny stocks because of the high risk associated. And while high risk can be scary, if you do the research, making money with penny stocks can be easy.
Ask any trader, and they’ll tell you that there is no secret trick to investing. However, getting a proper education in trading will be your most valuable asset. Often, new investors will look for the most trending penny stocks, and use this to create a watchlist. But, there are many other factors to consider. With biotech penny stocks, there are a few additional aspects to keep in mind.
If you’ve been researching penny stocks recently, you know that biotech is in focus. One of the main reasons for this is the pandemic. The coronavirus has highlighted various biotech companies, regardless of whether or not they are working on Covid-related treatments.
While the ones that are working on either a treatment or vaccine for Covid, are seeing bullish interest, the pandemic has increased focus on the biotech industry overall. Because the industry is inherently fast-paced, investors are always wondering what the next best penny stock will be.4 Hot Biotech Penny Stocks To Watch
As mentioned earlier, while some biotech companies are working on a Covid-related treatment, others are not. With any biotech penny stock, it’s important to consider a few different things. For one, what are they working on and how far along is it in the approval process?[Read More] Penny Stocks to Watch As DOGE Coin Skyrockets
Additionally, how large is the potential market size for a given product or compound? Another aspect to consider is; does the company have any drugs or products that are commercialized, or near commercialization? And lastly, what do its financials look like?
If you are a long-term investor, you probably want to consider a company’s pipeline and how it will look in the coming months or years. However, if you’re a short-term investor, you could consider the more speculative aspects of the company. This includes recent press releases, upcoming presentations, and whether or not any trials are beginning or ending soon. This will help to align your portfolio with your investing goals. Given that biotech penny stocks tend to fluctuate greatly, these are all important things to consider. With this in mind, let’s take a look at four biotech penny stocks to watch.
- Iterum Therapeutics Plc. (NASDAQ: ITRM)
- AIkido Pharma Inc. (NASDAQ: AIKI)
- T2 Biosystems Inc. (NASDAQ: TTOO)
- Ovid Therapeutics Inc. (NASDAQ: OVID)
While ITRM stock has not performed as well as hoped in the past few months, it could have a lot of momentum moving forward. To understand its prospects, let’s take a look at what the company does. Iterum is a clinical-stage pharmaceutical company developing anti-infectives for multi-drug-resistant pathogens.
Because of the high rate of antibiotic prescriptions around the world, many pathogens have become resistant to the drugs commonly used to treat them. This has resulted in newer, and more harmful antibiotic-resistant, sickness-causing agents. Its most notable compound known as sulopenem, is a novel, anti-infective that is currently in a Phase 3 trial. It has both oral and intravenous formulations. This drug has received QIDP or Qualified Infectious Disease Product and Fast Track Designations by the FDA for its efficacy in improving the arsenal of drugs used to treat serious, and life-threatening illnesses.[Read More] Are Penny Stocks Worth It? 5 Lessons For New Traders
In its fourth-quarter and full-year results announced on March 12th of this year, CEO Corey Fishman gave a statement regarding the company’s operations.
“Iterum has made excellent progress in the last few months and we look forward to continuing that momentum throughout 2021. In the fourth quarter of 2020, we submitted a New Drug Application (NDA) for oral sulopenem for the treatment of uncomplicated urinary tract infections (uUTI) in patients with a quinolone non-susceptible organism, which is currently under review by the U.S. Food and Drug Administration (FDA) with a July 25th, 2021 Prescription Drug User Fee Act (PDUFA) goal date.”Corey Fishman, CEO of Iterum Therapeutics
Fishman goes on to state that there are more than 6.5 million estimated individuals with uUTIs every year in the U.S. alone. This means that there could be a very large potential market for the company and its flagship compound.
Moving forward, the company plans to hold a Positive Advisory Committee meeting in June upon the completion of FDA review for the NDA mentioned above. Also, the company shows that it should have plenty of capital to sustain itself into the first half of 2023. This includes $74.3 million in net proceeds from a recent underwritten public offering as well as a registered direct offering.
Lastly, in February, the company announced the engagement of the life sciences commercial services provider, Eversana. The goal with this is for Eversana to provide commercial services for the launch of oral sulopenem, once all the details are squared away. Ahead of its upcoming presentation at the Needham Virtual Healthcare Conference, shares of ITRM are pushing up in recent trading sessions. Considering this, is ITRM stock worth watching?Aikido Pharma Inc. (NASDAQ: AIKI)
Aikido Pharma is another biotech company that operates similarly to Iterum. It develops small molecule anti-cancer therapeutics. The company has become more popular in the past few months for a new, antiviral drug platform that it is working on. This platform has indications for potentially inhibiting the replication of viruses, including MERS, Ebolavirus, and most notably, SARS CoV-2. Because of this, many investors see it as an interesting play for the pandemic. Aside from this, the most recent update from Aikido came on April 16th. On Friday, it announced encouraging results from a PSMA 617-Lu177 study.
Anthony Hayes, the CEO of the company noted, “As a rising tide lifts all boats, these results indicate the strength of our prior investment in this technology field. These early reports indicate there is strong evidence that developing radioligand therapies have the potential to be an alternative cancer treatment and provide positive outcomes for patients with advanced prostate cancer.”
Only a week or so ago, the company was also granted a sublicense to the technology used in targeted psilocybin treatment for neuro-inflamed tissue in cancer patients. The company has a history of using psychedelics to treat PTSD as well. Because of this, we can consider AIKI to be a psychedelic penny stock. This new category has only come to light in the past year or so, with new legislative measures going into place around the world. Psychedelic penny stocks have seen a great deal of momentum in 2021 so far.
At the moment, AIKI stock price is going through a correction. However, this is part of the natural ebb and flow of the stock market and penny stocks in particular. However, at its current price, AIKI could be a penny stock to watch.T2 Biosystems Inc. (NASDAQ: TTOO)
This next biotech penny stock is one that investors could bet on for the long term. T2 is an in-vitro diagnostics company that creates products used in diagnosing a large range of pathogenic infections. In its pipeline are diagnostic tools such as its flagship, T2 Magnetic Resonance technology or T2MR. This is used in tandem with the T2Dx system which allows for fully automated testing panels in hospitals and other medical settings. These panels can be used to identify both bacterial and fungal infections such as sepsis and Lyme disease.
Recently, the CEO of the company published an autobiographical novel, detailing his own experiences with Sepsis. While this is not necessarily company-specific, it could help to shine a light on the work that T2 is doing. Looking at more company-specific news, T2 recently released its fourth-quarter earnings report. In the report released last month, it showed revenue growth of 151.23% year over year. This is a big win for TTOO, and is a reflection of the company’s commitment to growth and innovation.[Read More] 3 Penny Stocks that Are Benefitting From the Pandemic
Moreover, its EPS or earnings per share increased by 76.67%. In tandem with this, on March 31st, T2 Biosystems announced a $150 million mixed shelf offering. With this, it should have plenty of capital to embark on future endeavors. Considering its prospects and the recent bullish interest in T2, investors might want to pay attention to TTOO stock.Ovid Therapeutics Inc. (NASDAQ: OVID)
Based in the U.S., Ovid Therapeutics is a biopharmaceutical company working on novel medicines for neurological disorders. It uses its platform known as BoldMedicine, to develop new and potentially groundbreaking treatments for rare diseases. This includes ailments such as Angelman syndrome, Fragile X syndrome, and certain monogenetic disorders.
In its pipeline are compounds such as OV239, a small molecule drug used in treating seizures; OV882 for Angelman syndrome; OV815 for neurological disorders, and other novel compounds. Because of its large pipeline, it is likely that OVID could see the commercialization of one or more of its products in the coming months or years. One step in this direction is its announcement of the closing of an agreement with Takeda for the global development and commercialization of Soticlestat.
This is a pharmaceutical used in the treatment of developmental and epileptic encephalopathies. This includes the treatment of illnesses such as Dravet syndrome and Lennox-Gastaut syndrome. Upon the closing of this deal, Ovid received an upfront payment of almost $200 million. Also, it has the potential to receive an additional $660 million upon certain regulatory and sales milestones.
Now, Takeda will take on the full responsibility of everything relating to Soticlestat. As you can see, commercialization is always the best thing a prospective investor can hear. While we should still wait to see its next balance sheet, this information could make OVID a penny stock to watch.