Shares of biotechnology firm Aditxt (NASDAQ:ADTX) — which specializes in therapeutics and technologies that monitor and modulate the immune system — popped up 25% on Friday morning before paring some gains in the early afternoon session. Nevertheless, ADTX stock is still up in double-digit return territory following management’s disclosure of its therapeutic portfolio expansion.
According to its press release, management looks to implement two key additions. First, it will invest resources in two current programs in monitoring and treating autoimmunity and organ transplantation via Adimune (a novel immunosuppressive drug) and Pearsanta (a monitoring and data processing platform).
Second, Aditxt will conduct a human clinical trial with the Mayo Clinic studying the central nervous system disorder Stiff-Person Syndrome using the biotech’s proprietary ADI-100. This immunotherapeutic technology drug addresses the rejection of transplanted organs, skin allografting, autoimmune diseases and allergies, per Aditxt’s disclosure.
“Our goal is to get our current programs to reach key clinical or commercial stage and expand our portfolio of innovations to address additional markets such as oncology and neurology,” explained Aditxt CEO, Chairman and co-founder Amro Albanna.
ADTX Stock Offers Critical Relevance but at a Cost
Undeniably, ADTX stock undergirds a critical and relevant business. According to the Organ Procurement and Transplantation Network (OPTN), one million organ transplants have been performed in the U.S. as of Sept. 9, 2022.
However, even with the use of immunosuppressants, about 10% to 20% of organ transplant patients will experience at least one episode of rejection, per Columbia University Department of Surgery. Inherently, this framework bolsters ADTX stock as Aditxt seeks to shift away from a one-size-fits-all approach to immunosuppressants.
Further, the global organ and tissue transplantation and alternatives market should hit a valuation of $120.3 billion by 2024, according to BCC Research. If so, this expansion would represent a compound annual growth rate (CAGR) of 7.4% from 2019 to 2024. Back in 2020, this market saw a valuation of $89.9 billion.
However, the main problem with ADTX stock remains its volatility. Using data from Stockcharts, ADTX opened 2023 at a price of $44. Therefore, even with the upswing in shares today, Aditxt’s stock is down about 58%.
In addition, investment data aggregator Gurufocus warns about four red flags impacting ADTX stock. Among them, an Altman Z-Score of 32.14 below zero indicates extreme distress and implies bankruptcy risk in the next two years.
Why It Matters
According to TipRanks, no Wall Street analyst within the past three months covers ADTX stock. However, between nine to 11 months ago, H.C. Wainwright and Dawson James analysts pegged Aditxt as a “buy.”
On the date of publication, Josh Enomoto 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.
