There’s a Major Upside Catalyst Behind Evoke Pharma Stock

EVOK stock is set to soar after receiving approval from the U.S. Food and Drug Administration

When it comes to the pharmaceutical market, regulatory approval (or the lack thereof) is all-important. It’s a major factor for a company like Evoke Pharma (NASDAQ:EVOK), so it’s natural for EVOK stockholders to watch these developments closely.

EVOK stock
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Thus, the U.S. Food and Drug Administration has a powerful presence in the pharmaceutical space. I can’t overstate this regulatory entity’s influence over the EVOK share price. A single approval from the FDA could provide it rocket fuel.

Evoke Pharma, a company that develops and markets drugs for gastrointestinal conditions, actually did receive the FDA’s approval for its flagship drug. This is a game changer, and the only question now is how far EVOK stock will fly.

All About EVOK Stock

The potential for EVOK stock to make a sizable move upwards is definitely there. Indeed, this stock has traded above $10 in the past. For much of 2020, however, EVOK has been trading in a range between $1 and $2.50.

But in June, an exciting piece of news demolished that trading range, catalyzing a major breakout. EVOK shares promptly hit the $3.50 level.

Is EVOK stock making its way back up to $10 — or maybe even higher than that? The sheer momentum of the stock-price spike has spurred plenty of talk about lofty price targets. Let’s slow down for a moment, though, and delve into the specifics of the high-profile catalyst for Evoke Pharma.

A Significant Problem

As I already mentioned, Evoke Pharma’s focus is on gastrointestinal conditions. This is an excellent area to be involved in as, according to the company, there are more than 31 million annual patient visits to gastroenterologists every year. And those specialists write 40 million prescriptions annually.

There is a significant issue with the commonly prescribed orally ingested treatments for gastrointestinal conditions. As Evoke Pharma explains, the problem is that by their very nature, gastrointestinal “diseases and disorders may limit the absorption of current oral therapies reducing their effectiveness.”

In other words, it’s sometimes difficult for people with gastrointestinal disorders to take, absorb and tolerate their medications orally. As a result, adults who suffer from diabetic gastroparesis sometimes haven’t been able to get symptomatic relief via oral treatments.

Rather than attempt to explain gastroparesis myself, I’ll let the experts at Evoke Pharma do the talking here. The condition, as they explain it, “is characterized by slow or delayed gastric emptying and evidence of gastric retention in the absence of mechanical obstruction.”

A Novel Approach

The unfortunate result of gastroparesis is that “Muscular contractions in the stomach, which move food into the intestine, may be too slow, out of rhythm or erratic.” If left untreated, gastroparesis could lead to very serious medical problems.

Thankfully, symptomatic relief will be more accessible through Evoke Pharma’s novel formulation known as Gimoti. It’s a simple innovation: a symptomatic treatment patients can take nasally.

And, also thankfully, the FDA recently approved Gimoti. Along with the company’s partner, Eversana Life Sciences, Evoke plans to commercialize Gimoti in this year’s fourth quarter.

So, now we know the story behind the price ramp-up in EVOK shares. As you might imagine, Evoke Pharma had a lot riding on this FDA approval. But this is just the beginning of the story as the company embarks on the commercialization phase for Gimoti.

How will this commercialization phase happen? Well, Evoke Pharma will rely on its key partnership with Eversana for funding. The FDA approval enables Evoke to access a $5 million line of credit from Eversana. These funds should certainly make it easier not only to manufacture Gimoti, but also to market it aggressively.

My Final Word on Evoke Pharma

Investors have every reason to rejoice. Thankfully, the FDA demonstrated wisdom and granted Evoke Pharma approval for this drug. With that approval in mind, Gimoti is a step forward, not only for EVOK stockholders, but for the broader medical community.

Louis Navellier had an unconventional start, as a grad student who accidentally built a market-beating stock system — with returns rivaling even Warren Buffett. In his latest feat, Louis discovered the “Master Key” to profiting from the biggest tech revolution of this (or any) generation. Louis Navellier may hold some of the aforementioned securities in one or more of his newsletters. 


Article printed from InvestorPlace Media, https://investorplace.com/2020/06/buy-evok-stock-fda-approval-gimoti-drug/.

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