Is Sorrento Therapeutics Inc (NASDAQ:SRNE) Stock Moving in the New Direction?

The coronavirus pandemic has come as a massive opportunity for biotech companies, and many companies who are working on a vaccine for COVID 19 have seen their stocks soar. One such stock is that of Sorrento Therapeutics Inc (NASDAQ:SRNE). Last month the company announced positive preclinical results in relation to the first COVID 19 vaccine candidate, and recently, it announced the same with regards to the second such candidate.

What to Expect Now?

Hence, it could be worthwhile for investors to take a closer look at the company. The company got feedback regarding the path forward for the second candidate, known as Covidtrap, from the United States FDA last week.

While the early stage data with regards to Covidtrap and the first candidate STI 1499 are encouraging, it should be noted that nothing can be guaranteed at this stage. It is true that the FDA had made it possible to grant fast track authorization to a certain product in light of the current crisis, but such authorizations have only been granted to products that were already at an advanced stage. However, in the case of Sorrento, the situation is different. The two candidates are nowhere near being marketable products yet.

Although the company can only boast of one product, ZTildo, in the market right now, it still has as many as 9 programmes in place for a range of products. Hence, Sorrento might not be completely dependent on the pair of COVID 19 vaccine candidates. However, it is also true that if it finds success, then it could propel the company to new heights. ZTildo has not performed particularly well as it generated revenues of $5.2 million in the latest reported quarter. The cost of generating that revenue came in at $2.4 million.

At this point, Sorrento has $21.9 million in cash, but it has filed a shelf registration in 2019 that allows it to issue as much as $1 billion in new securities. The company has also knocked back acquisition offers. While that may be positive, the company’s ability to fund its programs puts a question mark at this point.

About Travis Garlick 1791 Articles
Been writing about and trading stocks since 2013. Manage a group of micro-cap investors on Facebook with over 15,000 members. Turned $8,500 into 185k the first year I started trading stocks and haven't looked back.