3 Penny Stocks Waiting on FDA Approval for Rocket Fuel

penny stocks - 3 Penny Stocks Waiting on FDA Approval for Rocket Fuel

Penny stocks can be dicey propositions when you’re looking to add growth to your portfolio. No one can predict the future, but it looks like we might be nearing the end of an exciting trend.

As enthusiasm over biotech penny stocks begins fading, many investors will analyze regulatory activity to understand where the company will be in the coming months. It was inevitable as people became more focused on company-specific catalysts for drug candidate approval and started taking companies’ FDA pipelines into account.

The FDA approval of a new drug can be the driving force of any biotech, large or small. If successful in their application to market it as an over-the-counter medication, companies and their investors will see windfalls when licensing agreements are inked. It will also open the door for partnership deals and potential takeover offers.

The bottom line is that a positive FDA ruling is a major short-term catalyst for biotech stocks. With that in mind, let’s delve into the prospects of three biotech penny stocks that have FDA action in their foreseeable future.

  • Pharmacyte Biotech (NASDAQ:PMCB)
  • Sesen Bio (NASDAQ:SESN)
  • Mind Medicine (NASDAQ:MNMD)

Penny Stocks: PharmaCyte Biotech (PMCB)

A scientist holds a test tube while it is in a container
Source: Shutterstock

In recent years, the pharmaceutical industry has been on a quest for better treatments.

One company leading this charge is PharmaCyte Biotech. The company is developing cellular therapies based upon their proprietary cellulose-based live-cell encapsulation technology. This technology is capable of delivering drugs directly into cancerous cells where they belong and bypassing healthy tissue altogether.

Shares shot up recently after PharmaCyte issued a press release detailing favorable test results in biocompatibility studies for its CypCaps clinical trial product candidate.

The complement system is a network of proteins, approximately 30 in total. These work together to promote immune and inflammatory responses by interacting with various cells via receptors on their surfaces or cell membranes.

Meanwhile, the quest to lift a clinical hold on its Investigational New Drug application (IND) by PharmaCyte Biotech continues.

Last year, the company faced delays getting approval for its drug from the U.S. Food and Drug Administration (FDA). Shares torpedoed after the announcement. The biotech needs approval from the FDA to get going again. If that doesn’t happen soon, the company will soon lose much of the momentum built up last year.

Sesen Bio (SESN)

Image of two scientists in lab coats studying results in a lab
Source: Shutterstock

Sesen Bio shares are an excellent example of what happens when an FDA decision goes the wrong way. In mid-August, the stock crashed after markets learned regulators rejected its bladder cancer drug Vicineum. The announcement sent it straight into multi-year lows.

Shares tumbled $2.80, or 57%, to finish the trading day at $2.11 apiece on Aug. 13. At the time of writing, it is changing hands for 96 cents. However, there are a couple of positives SESN bulls should keep in mind.

The company announced that it had restructured its operations in response to the FDA’s refusal to approve Vicineum. Sesen Bio is looking to decrease its headcount by roughly 18 (~35%) and initiate other measures to preserve capital.

The restructuring plan will reportedly decrease annual cash costs by $5.7 million. In the third quarter, these aggregate charges are also projected at approximately $5.8 million.

In addition, the company has hired new personnel for its chemistry, manufacturing and control (CMC) and clinical development teams.

Eun Jang is now Senior Director, Analytical Sciences. Meanwhile, Chèrie Kaefring will be heading up operations as Director, Clinical Operations. The press release comes as Sesen Bio gears up for CMC and clinical Type A meetings with the FDA. Although timelines are sketchy, these meetings will take place before the end of 2021.

Penny Stocks to Watch: Mind Medicine (MNMD)

psychedelic stocks
Source: luckakcul / Shutterstock.com

MindMed is an innovative pharmaceutical company using psychedelic-inspired medicines to improve health, alleviate suffering and promote wellness. The stock teared it up on the OTC markets. But it is unable to replicate the same performance since listing on the Nasdaq.

Focusing more specifically on how psychedelics are shaping society’s views towards mental health through increased usage by celebrities like Will Smith and Megan Fox; there is no doubt that these substances will continue playing their part in shifting perceptions about what does–and doesn’t–work with one another within our culture.

Mind Medicine is working on Project Lucy, a commercial drug development program for treating anxiety disorders, focusing on these themes.

The company plans to present its IND application for Project Lucy in Q3 2021. MindMed expects to launch the phase 2B clinical trial shortly after that.

There are many drugs to treat anxiety, including Xanax, Librium, Klonopin, Valium, Ativan. These are all producing billions of dollars in revenue. If Project Lucy becomes successful, the stock price will soar.

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Read More: Penny Stocks — How to Profit Without Getting Scammed

On the publication date, Faizan Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Faizan Farooque is a contributing author for InvestorPlace.com and numerous other financial sites. Faizan has several years of experience in analyzing the stock market and was a former data journalist at S&P Global Market Intelligence.

Article printed from InvestorPlace Media, https://investorplace.com/2021/10/3-penny-stocks-waiting-on-the-fda-for-rocket-fuel-pmcb-sesn-mnmd/.

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