$RVVTF Revive Therapeutics Just Became A Serious P
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Posted On: 08/05/2020 7:07:08 PM
$RVVTF Revive Therapeutics Just Became A Serious Player In The Race To Treat COVID-19
https://twitter.com/SeekingAlpha/status/12910...07552?s=20
https://seekingalpha.com/article/4364822-revi...m=referral
Aug. 5, 2020 3:44 PM ET | About: Revive Therapeutics Ltd. (RVVTF)
Edward Vranic, CFA
Edward Vranic, CFA
Revive Therapeutics received FDA sign off to start a Phase 3 trial on Bucillamine for mild to moderate cases of COVID-19.
Bucillamine works to reduce inflammation and is a lot more potent than N-acetylcysteine which has been shown to prevent lung injury from influenza.
At a CAD $67 million market cap, Revive compares quite favorably to other pharmaceutical or vaccine companies looking to treat COVID-19.
There might be some selling pressure on Revive's stock due to past or future financings, but the hype over near-term results should offset any downward pressure.
Revive Therapeutics Ltd. (OTCPK:RVVTF) (RVV.C) is a Canadian life sciences company focused on the research and development of therapeutics for infectious diseases and rare disorders. It began the year hot as it was fully onboard the psilocybin craze before stocks like itself, Champignon Brands Inc. (OTCQB:SHRMF) and Mind Medicine (MindMed) Inc. (OTCQB:MMEDF) pulled back from their highs.
While the prospects of psychedelics on mental health remains an interesting opportunity for risk-tolerant investors, Revive has become hotter than ever as it attempts to repurpose its existing rheumatoid arthritis drug as a treatment for COVID-19. Upon news of the FDA signing off on a Phase 3 trial last week, the stock hit new highs on record volume on both sides of the border.
ChartData by YCharts
Revive gets a boost of credibility as FDA gives green light for its Phase 3 trial
Any experienced speculative investor in the biotech space is automatically weary of a microcap penny stock that tries to grab some headlines on a trendy topic, with this time around being the COVID-19 pandemic - especially one that was in the middle of the hype in a completely unrelated field just a few weeks ago. However, Revive got a tremendous boost of credibility when the FDA approved its Phase 3 clinical trial protocol to evaluate the safety and efficacy of Bucillamine in patients with mild to moderate cases of COVID-19. The company previously ran a successful FDA Phase 2 clinical trial with Bucillamine for the treatment of gout and got approved to run a Phase 2 FDA study for Bucillamine to treat ischemia. Therefore it had an open IND and strong data to support approval from the FDA to proceed to a Phase 3 study for Bucillamine to treat COVID-19. Bucillamine becomes one of a handful of drugs (as opposed to vaccines) conducting Phase 3 trials in an attempt to treat some aspect of the virus.
At first glance one might raise their eyebrow at a drug made for the treatment of rheumatoid arthritis being used to treat COVID-19. But there is scientific basis for this study and trial design. Revive wants to measure if Bucillamine has the potential to lessen the destructive consequences of SARS-CoV2 infection in the lungs through increasing glutathione activity and other anti-inflammatory activity. This is not dissimilar to the anti-inflammatory properties it has to treat rheumatoid arthritis in Japan and South Korea. The company hopes that the strong safety profile seen from 30 years of sales in those two countries translates to a safe drug to administer to COVID-19 patients.
N-acetylcysteine has been shown to prevent acute lung injury caused by the influenza virus. While it has a strong safety profile, Bucillamine is 16 times more potent than N-acetylcysteine with superior function in restoring glutathione and therefore has greater potential to prevent acute lung injury during influenza infection. The million dollar question would be if it can be used to treat or prevent lung injury in the coronavirus cousin? Its success would enable hospitals to free up ventilators and other resources for the most serious cases of COVID-19.
Revive will enroll up to 1,000 patients that will be randomized with one-third to receive Bucillamine 100 mg three times a day, another one-third receiving 200 mg three times a day and the final third receiving a placebo for up to 14 days. The primary objective is to measure the frequency of hospitalization or death in patients with mild to moderate COVID-19 who are receiving Bucillamine therapy compared to those receiving the placebo. The primary endpoint will be comparing instances of hospitalization or death between patients receiving Bucillamine and the control group for the first 28 days after receiving the first dose.
Every COVID-19 speculative trader should consider adding Revive to their watchlist
Due to the short length of the study period, it shouldn't be long after enrollment before investors start to see results. Interim analysis is planned after the first 210 patients have been dosed and monitored for the 28 day period. The greatest and most time consuming challenge Revive will have right now is finding patients to enroll in the study. The company has a Q4 milestone for having initial results, which becomes possible as soon as October if enrollment is successful in Q3.
Revive has 189 million shares outstanding and 267 million fully diluted shares outstanding according to its August 2020 investor presentation. As most of these warrants and options are well in the money, investors should use the fully diluted share count when assessing Revive's market cap. However, they also should consider that the exercise of these securities will bring in significant cash to the company and reduce the need for future capital raises.
Revive raised $2.5 million (all figures in Canadian dollars) throughout March and April in a financing and received additional funds through the exercise of warrants subsequent to Q1. After speaking with management, the company has close to $2 million in cash to-date with over $4 million expected to come in from the exercise of warrants in the near term. Running a clinical trial of this size is expensive, especially one proposed to be with 1,000 patients. But management estimates that it will have sufficient funding to move forward with the project as planned.
The financing becomes free trading soon, but because of the high volume of trading in Canada and the United States, I don't expect the release of these shares into the float to have a significant long-term impact. Investors should consider any temporary drop on profit taking from financings as a buying opportunity. Early investors may have gotten in cheap and be interested in taking profits, but they also invested prior to Revive announcing such great progress on the COVID-19 front. New and existing investors going forward should assess Revive's relative valuation based on its potential and accomplishments to its peers.
At $0.25 on the OTC exchange, RVVTF has a $67 million market cap. This compares very favorably to both COVID drug and vaccine makers and psychedelic peers, as Revive is more than happy to disclose in its presentation:
Source: Revive's August 2020 investor presentation
Even with the recent boost to its valuation, Revive is trading at less than half of its two aforementioned psychedelics peers. Based on the valuations of the more advanced stage vaccine and drug companies, which often exceeds $1 billion, Revive is trading at a mere fraction of them. Keep in mind that Revive is BOTH a near-term psychedelics and a COVID-19 play and yet trades below peers that can only claim to be one or the other.
I expect high volatility and heavy volume on Revive's stock in the near-term as speculators places their bets. This makes Revive a great stock to accumulate, speculate and trade over the next several weeks. Traders and investors must weigh in factors of Revive having a very favorable valuation and potential for near-term COVID-19 data catalysts against an increasing float from the recent financings and warrant conversions and the possible need for another capital raise in the near future.
Disclosure: I am/we are long RVVTF. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article
https://twitter.com/SeekingAlpha/status/12910...07552?s=20
https://seekingalpha.com/article/4364822-revi...m=referral
Aug. 5, 2020 3:44 PM ET | About: Revive Therapeutics Ltd. (RVVTF)
Edward Vranic, CFA
Edward Vranic, CFA
Revive Therapeutics received FDA sign off to start a Phase 3 trial on Bucillamine for mild to moderate cases of COVID-19.
Bucillamine works to reduce inflammation and is a lot more potent than N-acetylcysteine which has been shown to prevent lung injury from influenza.
At a CAD $67 million market cap, Revive compares quite favorably to other pharmaceutical or vaccine companies looking to treat COVID-19.
There might be some selling pressure on Revive's stock due to past or future financings, but the hype over near-term results should offset any downward pressure.
Revive Therapeutics Ltd. (OTCPK:RVVTF) (RVV.C) is a Canadian life sciences company focused on the research and development of therapeutics for infectious diseases and rare disorders. It began the year hot as it was fully onboard the psilocybin craze before stocks like itself, Champignon Brands Inc. (OTCQB:SHRMF) and Mind Medicine (MindMed) Inc. (OTCQB:MMEDF) pulled back from their highs.
While the prospects of psychedelics on mental health remains an interesting opportunity for risk-tolerant investors, Revive has become hotter than ever as it attempts to repurpose its existing rheumatoid arthritis drug as a treatment for COVID-19. Upon news of the FDA signing off on a Phase 3 trial last week, the stock hit new highs on record volume on both sides of the border.
ChartData by YCharts
Revive gets a boost of credibility as FDA gives green light for its Phase 3 trial
Any experienced speculative investor in the biotech space is automatically weary of a microcap penny stock that tries to grab some headlines on a trendy topic, with this time around being the COVID-19 pandemic - especially one that was in the middle of the hype in a completely unrelated field just a few weeks ago. However, Revive got a tremendous boost of credibility when the FDA approved its Phase 3 clinical trial protocol to evaluate the safety and efficacy of Bucillamine in patients with mild to moderate cases of COVID-19. The company previously ran a successful FDA Phase 2 clinical trial with Bucillamine for the treatment of gout and got approved to run a Phase 2 FDA study for Bucillamine to treat ischemia. Therefore it had an open IND and strong data to support approval from the FDA to proceed to a Phase 3 study for Bucillamine to treat COVID-19. Bucillamine becomes one of a handful of drugs (as opposed to vaccines) conducting Phase 3 trials in an attempt to treat some aspect of the virus.
At first glance one might raise their eyebrow at a drug made for the treatment of rheumatoid arthritis being used to treat COVID-19. But there is scientific basis for this study and trial design. Revive wants to measure if Bucillamine has the potential to lessen the destructive consequences of SARS-CoV2 infection in the lungs through increasing glutathione activity and other anti-inflammatory activity. This is not dissimilar to the anti-inflammatory properties it has to treat rheumatoid arthritis in Japan and South Korea. The company hopes that the strong safety profile seen from 30 years of sales in those two countries translates to a safe drug to administer to COVID-19 patients.
N-acetylcysteine has been shown to prevent acute lung injury caused by the influenza virus. While it has a strong safety profile, Bucillamine is 16 times more potent than N-acetylcysteine with superior function in restoring glutathione and therefore has greater potential to prevent acute lung injury during influenza infection. The million dollar question would be if it can be used to treat or prevent lung injury in the coronavirus cousin? Its success would enable hospitals to free up ventilators and other resources for the most serious cases of COVID-19.
Revive will enroll up to 1,000 patients that will be randomized with one-third to receive Bucillamine 100 mg three times a day, another one-third receiving 200 mg three times a day and the final third receiving a placebo for up to 14 days. The primary objective is to measure the frequency of hospitalization or death in patients with mild to moderate COVID-19 who are receiving Bucillamine therapy compared to those receiving the placebo. The primary endpoint will be comparing instances of hospitalization or death between patients receiving Bucillamine and the control group for the first 28 days after receiving the first dose.
Every COVID-19 speculative trader should consider adding Revive to their watchlist
Due to the short length of the study period, it shouldn't be long after enrollment before investors start to see results. Interim analysis is planned after the first 210 patients have been dosed and monitored for the 28 day period. The greatest and most time consuming challenge Revive will have right now is finding patients to enroll in the study. The company has a Q4 milestone for having initial results, which becomes possible as soon as October if enrollment is successful in Q3.
Revive has 189 million shares outstanding and 267 million fully diluted shares outstanding according to its August 2020 investor presentation. As most of these warrants and options are well in the money, investors should use the fully diluted share count when assessing Revive's market cap. However, they also should consider that the exercise of these securities will bring in significant cash to the company and reduce the need for future capital raises.
Revive raised $2.5 million (all figures in Canadian dollars) throughout March and April in a financing and received additional funds through the exercise of warrants subsequent to Q1. After speaking with management, the company has close to $2 million in cash to-date with over $4 million expected to come in from the exercise of warrants in the near term. Running a clinical trial of this size is expensive, especially one proposed to be with 1,000 patients. But management estimates that it will have sufficient funding to move forward with the project as planned.
The financing becomes free trading soon, but because of the high volume of trading in Canada and the United States, I don't expect the release of these shares into the float to have a significant long-term impact. Investors should consider any temporary drop on profit taking from financings as a buying opportunity. Early investors may have gotten in cheap and be interested in taking profits, but they also invested prior to Revive announcing such great progress on the COVID-19 front. New and existing investors going forward should assess Revive's relative valuation based on its potential and accomplishments to its peers.
At $0.25 on the OTC exchange, RVVTF has a $67 million market cap. This compares very favorably to both COVID drug and vaccine makers and psychedelic peers, as Revive is more than happy to disclose in its presentation:
Source: Revive's August 2020 investor presentation
Even with the recent boost to its valuation, Revive is trading at less than half of its two aforementioned psychedelics peers. Based on the valuations of the more advanced stage vaccine and drug companies, which often exceeds $1 billion, Revive is trading at a mere fraction of them. Keep in mind that Revive is BOTH a near-term psychedelics and a COVID-19 play and yet trades below peers that can only claim to be one or the other.
I expect high volatility and heavy volume on Revive's stock in the near-term as speculators places their bets. This makes Revive a great stock to accumulate, speculate and trade over the next several weeks. Traders and investors must weigh in factors of Revive having a very favorable valuation and potential for near-term COVID-19 data catalysts against an increasing float from the recent financings and warrant conversions and the possible need for another capital raise in the near future.
Disclosure: I am/we are long RVVTF. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article
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