Investors have seen some impressive moves in recent days in the world of micro-cap biotech stocks. Today, InMed (NASDAQ:INM) is among the leading gainers in the market, surging more than 110% as of this writing. Indeed, INM stock has seen a flurry of interest, making highs not seen since the first quarter of this year in today’s session.
This move comes on news that the company’s lead Alzheimer’s drug candidate, INM-901, has seen some positive proof-of-concept study results. Via a disease treatment model and early in vitro research, the company noted that this drug candidate “showed potential to target several biological pathways associated with Alzheimer’s, including neuroprotection to the brain neurons from beta-amyloid peptide-induced toxicity and improving neuronal function via extension of neurite length.” In addition, INM-901 also “demonstrated favorable results in an in vivo preclinical Alzheimer’s proof-of-concept model.”
Let’s dive into what this all means for investors intrigued by today’s move in INM stock.
INM Stock Surges on Favorable Initial Results
As with many micro-cap biotech companies, InMed’s valuation is a direct consequence of its research and development of key potential drugs. Currently valued at less than $5 million (after today’s rise), InMed is certainly among the higher-risk, higher-upside options for investors to consider right now.
Additionally, it’s worth pointing out that the biotech company appears to be pursuing home run drugs in much more difficult areas of the pharmaceutical market, such as Alzheimer’s. With certain drugs recently approved by the U.S. Food and Drug Administration (FDA), this group of drugs continues to be under scrutiny.
It’s entirely possible that INM stock could be a home run in its own right, seeing its valuation multiply on takeover rumors or other positive clinical trial results. However, like many of its peers, it’s also possible that this company will run out of funding and cease to exist. Such is the case with higher-risk micro-cap biotech stocks.
That said, this is a company that’s found its way onto my watch list, given the positive reception the market has given its early results. Anything’s possible, which is why many in the market appear to be buying a lottery ticket and grabbing shares of this penny stock today. Personally, I’ll have to see how the stock performs in the coming weeks and months before making a determination as to whether there’s something here or not.
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On the date of publication, Chris MacDonald did not hold (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.