Innovus Pharmaceuticals Inc (OTCMKTS:INNV) Files Quarterly Report

Yesterday Innovus Pharmaceuticals Inc (OTCMKTS:INNV) issued a new PR reminding investors that it has filed an Abbreviated New Drug Application with the FDA for its FlutiCare nasal spray. According to the company’s expectations a response from the FDA should come between July and August. The PR had a tremendous effect on the performance of the stock – by the time of the closing bell INNV were sitting over 40% in the green at $0.145 per share. A total of 2.61 million shares changed hands during the session.

After the end of the trading day, however, INNV submitted their financial report for the first quarter of the year. Will the numbers inside it push the stock to even greater heights, or is the exact opposite going to happen when the market opens today?

Opening the quarterly reveals that at the end of March INNV had:

• $32,555 cash
• $378 thousand total current assets
• $3.56 million total current liabilities
• $224 thousand net revenues
• $1.55 million net loss

Although the company has 13 commercialized products on a year-over-year basis the reported revenues show a rather underwhelming increase of less than $30 thousand while the net loss has remained massive. In addition, INNV have a working capital deficit of nearly $3.2 million and an accumulated deficit of just below $17 million. Since the start of 2016 INNV have also issued quite a lot of shares and as a result the number of outstanding shares has grown from 47 million to 71 million as of May 13.

If the stock of the company continues to climb up the chart it may soon be facing another problem. During the third quarter of 2015 INNV sold six convertible notes for $1.32 million in proceeds. These notes can be converted into common shares at a price of $0.15 per share.

The red flags around INNV must be taken into account when deciding whether to put any money into their stock or not. Do your own due diligence and adjust your trades accordingly.