Jason Karp Takes Long Position In This Stock, Up By 480% This Year

While dexmedetomine may not ring a bell for the average investor, that’s not overly important. What is important is not what Dex-IN consists of and what it is, it’s how the drug travels from the lab to our medicine cabinet. Not so long ago, Dex-IN was being tested in Phase II clinical trials. On July 17, Recro Pharma announced positive efficacy results in the Phase II clinical trial for this treatment. This is great news for the shareholders of Recro Pharma and for the company itself. This implies that the commercialization of its lead product candidates is around the corner. Dex-IN met the primary endpoint of the mid stage clinical trial in proving significant pain relief compared to a placebo over 48 hours. Even more to that, Recro Pharma announced its plans to meet with the U.S. Food and Drug Administration in order to discuss the company’s Phase III plans. If approved, Dex-IN would be the first and only acute post-operative drug in its class of drugs. So the company might unlock a flourishing revenue stream with the approval of this drug.

The shares of Recro Pharma have increased by just under 480% year-to-date, while the company’s market capitalization has reached a figure of $130.02 million. Just recently, the company announced that it had closed its private placement that was announced on July 1. Following the company’s securities purchase agreement with a group of institutional investors led by Kevin Kotler’s Broadfin Capital, Recro Pharma issued nearly 1.38 million shares of common stock, which provided $16 million in gross proceeds. Kevin Kotler’s fund has disclosed its own enhanced position, of 2.06 million shares in the pharmaceutical company, via a recently-amended 13G filing with the SEC (see more details). Recro Pharma intends to use the raised capital to fund the clinical development of its late stage lead candidates. It’s also worth mentioning that the purchase price for the common stock was $11.60 per share, whereas the stock is currently trading at $16.58 per share. Dov Gertzulin’s DG Capital Management is among the largest shareholders of Recro Pharma Inc. (NASDAQ:REPH) with an ownership stake of 314,718 shares.

Disclosure: None