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Here's What The Opiant Pharmaceuticals Inc (OTCMKTS:OPNT) (NASDAQ:OPNT) NASDAQ Listing Tells Us

Here's What The Opiant Pharmaceuticals Inc (OTCMKTS:OPNT) (NASDAQ:OPNT) NASDAQ Listing Tells Us
Written by
Chris Sandburg
Published on
August 29, 2017
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Opiant Pharmaceuticals Inc (OTCMKTS:OPNT) (NASDAQ:OPNT) just announced that it is has received approval for listing on the NASDAQ Capital Market. Trading under the symbol OPNT (so, unchanged on its OTC listing) will begin at market open US on August 29 (so, today). Back on August 10, we published this piece outlining why we thought Opiant was undervalued at its then-current pricing. The latest announcement has brought with it a considerable amount of strength, with the company set to open at just shy of $23.50 a share – a 30% premium on its Monday open and massive 318% premium to its 2017 year-open price. OPNT Daily ChartSo what does this mean for the expectations we outlined in our previous coverage?For anybody that missed our last article on Opiant, it might be worth taking a quick look before we continue here. It's available here for anybody that's interested. For those not wanting to click away, however, we will kick things off with a brief introduction.The company is a biotechnology stock that is trying to (as the name suggests) tackle the increasingly serious opioid and related drug abuse epidemic in the US right now. The company's lead product is called Narcan and it's designed to block the effect of opioids, with use primarily rooted in immediate post overdose therapy. The company licenses the drug to resellers and collects royalty revenues on sales. One of the core elements of our long thesis on this company is that these royalty revenues allow Opiant to foot the bill for its research and development efforts, taking the edge off any potential dilution risk for shareholders. The revenues don't cover all of R&D, of course, but it's a bonus nonetheless and is one that many similar stage, similar size companies don't offer shareholders.The NASDAQ listing, for us, is important for reasons outside of Narcan, however.Opiant is trying to develop a heroin vaccine, as well as products in development for both Opioid Use Disorder and Alcohol Use Disorder. CEO Roger Crystal is doing the rounds on mainstream news media outlets in the US right now, having appeared on Fox News during the middle of this month and on the FOX Business Network (Fox and Friends) at the end of July.We noted last time that cash on hand at the most recent count came in at around $9 million and that a recent $3.75 million injection served up a runway that should, at current expenditure, last through mid 2018. This doesn't take into consideration the initiation of an extensive development program, however.Increased media presence combined with a NASDAQ listing (and, by proxy, the increased financial market presence that the latter offers) tells us that Opiant is likely looking to pick up some cash with which it can drive forward to the above-referenced pipeline products, and primarily, the heroine vaccine. A NASDAQ listing should allow the company to do this on far better terms than it would otherwise have been able to OTC and we wouldn’t be surprised if the nature of the drugs in question brought in some institutional interest.Once the program is underway and rolling forward, we should really start to see the stock appreciate in value as catalysts hit press in line with efficacy expectations and against the backdrop of mainstream media coverage of the epidemic to which Opiant is trying to provide a solution.The bears out there will question this thesis – why take a position stock that we are pretty sure is about to conduct what will no doubt prove to be a dilutive raise? Well, first, because the uplisting (as mentioned) provides something of a buffer to negative terms associated with the raise. For anybody wanting to limit risk, however, there's always the potential for waiting until the raise is announced and loading up as the company dips on market absorption of the news.Check out our previous coverage of this one here.We will be updating our subscribers as soon as we know more. For the latest updates on OPNT, sign up below!Image courtesy of frankieleon via FlickrDisclosure: We have no position in OPNT and have not been compensated for this article.

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