Biotech Catalyst Play: Adamis Pharmaceuticals Corp (NASDAQ:ADMP)

Adamis Pharmaceuticals Corp (NASDAQ:ADMP) is a tiny biotech company that trades for a market capitalization of $100 million. It's off 2017 highs by about 20% at current pricing and it's down nearly 60% on its price this time last year.In two weeks' time, however, this one could run considerably.Adamis has a major catalyst incoming and if it falls favorably for the company it's going to bring about a sharp and dramatic upside revaluation.Here's what traders need to know ahead of the event.Adamis has spent the better part of this decade trying to get a generic version of Mylan's EpiPen approved in the US. Many reading will likely already be familiar with the EpiPen pricing situation, but for those that aren’t, Mylan took a lot of flack last year for the systematic increase of the price of its EpiPen product – an epinephrine injector that generates more than $1 billion annual revenues for the company and that accounts for around 40% of Mylan's operating profits. Back in 2009, a pack of two pens costs $100. By end last year, the same pack cost $600. The company has said it has plans to reduce the cost, but as yet, it remains an open issue. The root of the issue is that these are literally life-saving devices and for cost to prohibit access is not acceptable.So, Adamis is trying to bring one to market that will cost around $300. Based on Mylan's sales at $600, there's a $500 million plus market potential for the generic device if it hits shelves. As we've mentioned, the company is currently a $100 million market cap stock.To date, things haven’t gone that well. Adamis has picked up two CRLs from the FDA related to the asset, each of which has set the program back by 6 months or more. Neither CRL, however, related to the safety or efficacy of the active ingredient. Basically the FDA wanted to confirm that the amount of active ingredient was sufficient in the first knock back and that the injector itself was easy enough to use in the second CRL. Adamis conducted trials to address both these concerns and the latest resubmission, which included data from a study designed to make sure people knew how to use the pen, came in December 2016. The FDA accepted the submission for review and while we didn’t get a specific PDUFA for the device, the general review time on these resubmissions is about 6 months.Combining this expected review time in line with the resubmission dates gives us a target date for an FDA decision of June 15. There's a chance that the FDAs response will extend to July, given that the agency didn’t actually accept the resubmission until early January, but we wouldn’t want to wait that long to initiate a position and potentially miss the run.If the agency green lights the product, Adamis is going to have immediate access to a market that – even with a discounted product – is worth a five-times-multiple of its current market capitalization. Its product will be half the price of the current branded version and there's already a large degree of awareness surrounding the product, from a physician and a patient perspective, both on the back of the length of the development program (a silver lining to the repeated FDA declines) and the media focus on Mylan's asset and Adamis' answer said asset's exorbitant pricing.The company closed an offering last month that saw it gross $17.25 million, which removes any near-term dilution risk. There's a chance we may see a fresh offering before the end of the year, necessitated by the costs associated with the commercial rollout of the above discussed EpiPen alternative, but we don't see this potential as prohibitive to an exposure given the revenue potential of the product in question and the company's position in the market.We will be updating our subscribers as soon as we know more. For the latest updates on ADMP, sign up below!Disclosure: We have no position in any of the securities mentioned and have not been compensated for this article.