Biopharmaceutical company Palisade Bio (NASDAQ:PALI) is seeing its market value skyrocket off multiple encouraging catalysts today. While PALI stock still remains an extremely risky proposition, investors are being buoyed by some key developments.
First, according to Seeking Alpha, Palisade Bio has cancelled a proposed offering. In filings made with the U.S. Securities and Exchange Commission (SEC) last Friday, the company said that it is withdrawing a proposal for a $5 million offering of PALI stock. At the same time, the company is planning to hold a special meeting of shareholders to vote on a reverse stock split.
The split may range between 1-for-2 and 1-for-15. However, the company did not specify when this meeting would take place. Since secondary rounds of equity offerings typically indicate to investors that the target security is overvalued, Palisade’s offering cancellation is helping restore some confidence in the bruised enterprise among investors.
For the trailing one-year period, PALI stock is down by more than 50%.
Positive Preclinical Data Reinvigorates PALI Stock
Although the aforementioned “administrative” details are helping support Palisade Bio today, PALI stock is probably skyrocketing the most due to a disclosure of positive preclinical data for PALI-2108. Per the company’s website, this therapeutic is a “microbiota-activated PDE4 inhibitor prodrug being developed for the treatment of moderate-to-severe ulcerative colitis.”
According to a press release, Palisade announced the presentation of its positive preclinical data at the Crohn’s & Colitis Congress in Las Vegas, Nevada.
Some of the key points that Palisade presented were as follows:
- Profile: PALI-2108 is orally administered and colon-activated nature, “allowing for local activity” in patients’ systems with “low systemic exposure.”
- Efficacy: PALI-2108 demonstrated reduced disease activity in mice. Additionally, body weight loss was “attenuated in specific dosage groups, showcasing the potential for targeted efficacy.”
- Tolerability: Significantly, a “tolerated dose study” in canines also revealed no central nervous system (CNS) toxicity or emesis over effective doses, “addressing a critical concern associated with oral administration.”
Naturally, Palisade leadership expressed optimism in regards to these findings. Palisade Chief Medical Officer Mitchell Jones stated that PALI-2108 demonstrates promise as a novel therapy for ulcerative colitis (UC), specifically citing its colon-selective bioactivation, among other attributes. Moving forward, Jones believes this “innovative approach has the potential to revolutionize UC treatment and enhance patient outcomes.”
Why It Matters
Interestingly, two analysts have covered PALI stock within the past year per TipRanks, with both rating shares as a buy. The latest assessment comes from Maxim Group analyst Naz Rahman, who foresees PALI stock hitting $1.50 per share. Still, investors should exercise caution. With a market capitalization flirting with the $10 million mark, shares are a high-risk, high-reward proposition.
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On the date of publication, Josh Enomoto 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.
