Catalyst Pharmaceuticals, Inc. (NASADAQ:CPRX) Could Gain More on Study Results

[[tagnumber 0]]Yesterday Catalyst Pharmaceuticals, Inc. (NASADAQ:CPRX) shares broke the resistance of the upper Bollinger band and the new rally could continue in the next trading session. The stock attracted trading attention through the announcement of encouraging trial results, yet it looks like it got massively shorted as well last week.[[tagnumber 1]] [[tagnumber 0]][[tagnumber 3]][[tagnumber 1]] [[tagnumber 0]]CPRX closed Thursday session with another 3.51% gain at $4.42 for a share. Although the stock price rose over two sessions and broke the upper end of the recent trading channel, trading volumes remained below the average while technical indicators give strong bullish signals for the next session on Monday. Short sales data for CPRX suggests short sales are increasing, which could add pressure on the stock price as well next week.[[tagnumber 1]] [[tagnumber 0]]The company is currently working on three product candidates the most advanced of which is Firdapse. It is aimed for the treatment of Lamber–Eaton Myasthenic Syndrome (LEMS) and CPRX expects approval by the FDA and commercial launch in the third quarter of next year.[[tagnumber 1]] [[tagnumber 0]] [[tagnumber 1]] [[tagnumber 0]]The most recent press release concerned the second product the company plans to develop which is supposed to be used by patients with Tourette‘s Disorder. The drug candidate is still in a very early stage of development and the results from a proof–of–concept trial were encouraging, according to the company‘s press release.[[tagnumber 1]] [[tagnumber 0]] [[tagnumber 14]][[tagnumber 1]] [[tagnumber 0]]As a development–stage company, CPRX has to rely on equity offering and government grants to finance its operations. At the end of the last quarter, it had about $71 million in cash and although the company believes to have its operations covered by the end of 2016, investors should consider potential dilution risks.[[tagnumber 1]] [[tagnumber 0]] [[tagnumber 1]] [[tagnumber 0]]CPRX has an active shelf registration statement with the SEC to sell up to $100 million of common stock. Up to date, it has conducted two offerings for $26.7 million last year and $34.9 million this year, while it also increased the total number of shares available for issuance from 100 million to150 million.[[tagnumber 1]] [[tagnumber 22]] [[tagnumber 1]]