Today's Microcap Runner Is Arch Therapeutics Inc (OTCBB:ARTH)

Shares of Arch Therapeutics Inc (OTCBB:ARTH) have turned into a massive gainer for our readers and subscribers. We said at the beginning of last month that the company was on the verge of a breakout. Since our article, shares have doubled and we think the run could just be getting started.Arch Therapeutics Inc describes itself as "a medical device company developing a novel approach to stop bleeding (hemostasis) and control leaking (sealant) during surgery and trauma care. Arch is developing products based on an innovative self-assembling peptide technology platform to make surgery and interventional care faster and safer for patients. Arch's flagship development stage product candidate, known as the AC5 Surgical Hemostatic Device, is being designed to achieve hemostasis in surgical procedures."The big news from the company last month was that it had completed patient enrollment in its first clinical study to assess the safety and performance of AC5 in humans. The study is being carried out in collaboration with CÚRAM, Science Foundation Ireland Centre for Research in Medical Devices and the Clinical Research Facility based at National University of Ireland Galway. A total of 46 patients have been enrolled in this randomized controlled single-blind study, which is taking place in Ireland.The company anticipates announcing the results from the study during summer 2016 after completion of the patient follow-up assessments (30-day) and subsequent statistical analysis. The endpoints include product-related adverse events and time to hemostasis. To date, no serious adverse events have been reported.The current study design is intended to assess safety and performance of AC5 during the course of a dermatological procedure performed on the 46 patients, of whom 10 were taking an antiplatelet medication, such as aspirin, during the study period, and was designed so that neither the patients nor the clinical personnel performing the 30-day follow-up assessments would be aware of whether a particular lesion had been treated with AC5 or a control. Patients participating in the study had at least two dermatological lesions removed surgically, of which one was randomly assigned to be treated with AC5 and the other lesion assigned to be treated with a control treatment.There a couple of things to keep in mind in regard to ARTH and why we like the company so much. First, the company is seeking approval for a medical device and not a drug. This will get a much quicker approval time and be less costly. We believe that the total funding required will be around $6 million to $10 million. This is a drop in the bucket compared to the costs of advancing a drug through the clinical trial process.Second, we could have clinical data results any day now. The current study design was well planned and we anticipate positive results. If we get the results we're looking for, look for the stock to shot above $1. If the data disappoints however, we're looking at a possible 50% haircut in price. The only good news would be that it would put shares back at the early June levels. The last equity raise was at $.36 per share and that represents a strong floor in our opinion.Third, Arch has a strong IP portfolio. It still has a number of years on many of its patents. We could easily see a buyout for the company come from J&J or another big pharma player. The AC5 has already demonstrated and proven that it can stop bleeding within seconds compared to other methods.Currently trading with a market cap of $105 million, ARTH is at the forefront of hemostasis. The market for Arch is estimated to be $6.5 billion by next year. The AC5 is designed to quickly stop bleeding with rapid onset of hemostasis. This is truly revolutionary technology and explains the move higher in shares of ARTH. If the clinical data results come in as expected, it could be the last time we see ARTH trading under $1. We will be updating Insider Financial as soon as we know more. For continuing coverage on ARTH, sign up for our free newsletter today and get a free ebook as an added bonus!Disclosure: We have no position in ARTH and have not been compensated for this article.