Sell Biotech? I Wouldn't DARA!
|Written by GSCR Staff|
|Tuesday, 18 March 2014 07:21|
In last week’s Goldman Guide we mentioned that the latest tech and biotech run in the small cap space is still a great short term trade. Today our selection is a biotech up and comer that could do some serious moving in the next few months.
DARA BioSciences, Inc. (NASDAQ – DARA - $3.06) is a development stage bio-tech firm that is on the cutting edge of oncology treatment and supportive care pharmaceutical products.
Its Soltamox line is for the treatment of breast cancer and for cancer prevention in certain susceptible breast cancer subgroups. Gelclair, an oral gel is for the treatment of oral mucositis, and Bionect is for the management of irritation of the skin, as well as first and second degree burns. Its clinical programs include KRN5500, which is currently in Phase III, is a non-narcotic/non-opioid intravenous product for the treatment of cancer patients with painful chronic chemotherapy induced peripheral neuropathy. DB959 is a treatment for Type II diabetes and dyslipidemia, or an excess of fat in blood.
The Daily Moving Average for DARA is very bullish, and the stock has entered another accumulation phase rising nearly 22% over the last month on nearly 500,000 shares traded per day after a large 40% drop in late January. The Company got a fresh $6 million in direct offering in early February which was the impetus for the bounce.
The deal flow and clinical progress are a nice part to the DARA story. Late last month the Company announced that the U.S. Food and Drug Administration (FDA) granted Orphan Drug Designation for KRN5500 for the parenteral treatment of painful, chronic, chemotherapy-induced peripheral neuropathy mentioned above. On the deal side DARA entered an agreement with Medicare Part D Drug Program Reimbursement Agreement and with Comprehensive Health Management, Inc. to provide formulary status for Soltamox® (tamoxifen citrate) oral solution, the only liquid form of tamoxifen, used for the treatment and prevention of breast cancer.
Look for pops when new deals are announced and updates on clinical trials occur. A target of $4.00 sometime in the late in 2Q14 is a level that DARA should attain. Have a great day!
Disclosure: Goldman Small Cap Research analysts are neither long nor short these shares but may elect to purchase the stock within the next 48 hours.
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