TapImmune Inc. (OTCMKTS:TPIV) Remains Completely Flat
Yesterday TapImmune Inc. (OTCMKTS:TPIV) published a new PR announcing the successful transfer of the Mayo Clinic Investigational New Drug Application as part of the recently completed licensing agreement. This brings the company one step closer to initiating its Phase 2 clinical trials in patients with triple-negative breast cancer or ovarian cancer. Earlier this year TPIV announced positive results from their Phase I clinical studies.
The PR did leave its mark on the movement of the stock with TPIV opening above their previous close and quickly moving to a high of 51 cent per share. Unfortunately the positive momentum disappeared equally as fast and the stock plunged down in the red. Ultimately TPIV finished the session completely flat at $0.49. The stock has been unable to form any sort of an uptrend for quite a while and when compared to the highs of $1.71 posted in June it is now sitting 71% lower. What could explain such a dramatic drop down the chart?
Well, TPIV’s financial state is actually not that bad. The financial report that was filed last Friday covers the second quarter of the year and according to it as of June 30 TapImmune had:
• $3.1 million cash
• $3.25 million total current assets
• $13 million total current liabilities
• ZERO revenues
• $18 million net loss
The cash reserves are substantial while the lack of revenues and the sizable losses should be expected from a pennystock company trying to develop new drugs or treatments.
The problem is the massive dilution of the common stock that has been taking place since the start of the year. As of December 31, 2014, TPIV had 20.3 million outstanding shares while as of August 16, 2015, that amount had already more than doubled surpassing 46 million shares. The majority of the freshly printed shares were issued at prices significantly lower than the current market price. Over 12 million shares were issued as part of the investment units sold back in March at $0.20 each, 5 million shares were issued through the exercise of Series C warrants at $0.50 while between July 16 and August 13 7,890,000 of the Series B Warrants were exercised at $0.20.
The dilution is indeed alarming but at least the company is getting some nice proceeds from it. These funds will be used to sponsor the Proof of Concept Phase 2 clinical studies of the company. For now though the stock could continue to find it hard moving in the right direction. The millions of shares that saw the light of day at prices nearly 60% below yesterday’s close and the fact that there are a lot more outstanding warrants could continue to influence TPIV’s chart performance negatively. Even if you believe in the potential of the company you should do your due diligence before putting any money on the line.
