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Neurotrope Inc (NASDAQ:NTRP) Is On The Road To Recovery

Neurotrope Inc (NASDAQ:NTRP) Is On The Road To Recovery
Written by
Chris Sandburg
Published on
September 14, 2017
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Last time we covered Neurotrope Inc (NASDAQ:NTRP), the company had taken a bit of a hit on some trial data and was struggling to maintain positive sentiment from shareholders. We pointed out that market interpretation of the data was, in our view, incorrect and that as a result, we would at some point see a rebalancing and a run to the upside in Neurotrope stock.The company bottomed out towards the end of last month and, throughout early to mid-September, has started to pick up some strength. We think this may be the start of a long-term recovery we have identified a number of near-term catalysts that could serve to compound the momentum we are seeing. NTRP Daily ChartFor those that missed our previous coverage of this one, Neurotrope is trying to develop a drug called Bryostatin. It's an Alzheimer's drug, which is a notoriously difficult indication to go after, and the latest data derived from a 12-week phase 2 trial.There were a couple of problems with the data and these problems served as a platform for shorts to cry failure. The first was that the primary endpoint achieved a P value of 0.07. That's 0.02 way from the standard 0.05 generally regarded as the threshold for statistical significance, which translated to a technical failure against the primary.The second was that the completed not release data associated with the higher dose of the drug, 40 µg, and just put out 20 µg numbers. Again, the shorts highlighted this as indicative of failure, because there was no dose-dependent impact (normally you want to see a higher dose have a higher degree of impact from an efficacy perspective).As we pointed out, however, with this type of treatment, the failure of the high dose to bring about as much of an impact as the low dose actually reinforces the mechanism of action that underpins the treatment. Basically, a higher dose can overwhelm neuronal circuits and inhibit the drug’s clinical activity.So this was a dose discovery trial and company found out that 20 µg is the optimum dose as it is neither too low to not have an impact nor too high to inhibit its own MOA.Our long-term bull thesis was rooted in the idea that once the shorts were forced out of the market and once the company presented this data at a couple of medical conferences (i.e. to physicians and scientists that would actually interpret it correctly) Bryostatin would start to attract some speculative positive interest.And that is exactly what we saw.Management presented at AAIC 02017 recently and – as mentioned above – the stock is on its way up.So what is going to compound this action?Well, we just got a business update and a look at the financials, which served up some insight as to the next steps for Neurotrope and Bryostatin. Basically, the company wants to carry out a follow-on dose optimization study in order to confirm how the strength of the therapeutic signal observed with the low dose Bryostatin can be maintained and enhanced.And it's this study that we are looking to as the next major catalyst for the stock. When initiation takes place we will no doubt see a wave of speculative capital flow towards the company and the subsequent release of data from the study will only build on this incoming volume – assuming the numbers come out in a similar fashion to those that we saw in the above-discussed phase 2.Cash on hand as of June 30 was $21.5 million and quarterly burn right now is around $1.1 million. There is an outstanding liability of $2.4 million due to Worldwide Clinical Trials for the recent phase 2 clinical trial, but beyond that, and using the above figures, there's plenty of runway that should allow the company to carry out the dose optimization study without diluting shareholders.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 NTRP, sign up below!Image courtesy of Tim Painter via FlickrDisclosure: We have no position in NTRP and have not been compensated for this article.

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