Tenax Therapeutics (NASDAQ: TENX) stock is up 297% on news from the FDA. The regulator has approved a testing protocol for a drug candidate. Which is good - you can’t get anywhere in pharma development without the FDA’s sign off after all. But it’s also worth noting that this is the very start of the drug testing process. There’s lots of work to be done yet. So, yes, this is value additive. But the percentage change in the stock price is more because of the tiny market capitalization than it is anything else.
The business line: “Tenax Therapeutics, Inc. develops and commercializes pharmaceutical products containing imatinib for the treatment of pulmonary arterial hypertension. It develops TNX-101 (IV), TNX-102, and TNX-103 (levosimendan) that have completed phase II clinical trials for the treatment of patients with pulmonary hypertension associated with heart failure with preserved ejection fraction and associated pulmonary hypertension;” and so on. Pharma development - and we all know how important FDA approval is in this line of business.
The actual announcement: “First Phase 3 study of TNX-103 in PH-HFpEF patients to start in 4Q 2023 (The LEVEL Study) FDA agreement that 6MWD will be the primary endpoint for both Phase 3 studies Phase 3 program designed to satisfy FDA’s request for subject drug exposure of 300 patients for 6 months, 100 patients for 1 year (minimum requirements per ICH guidelines)” So, that’s the sign off on the study looking for ill effects among a larger cohort of patients. It’s take that year, at least, to do, then there will be review, perhaps some reworking and so on. We’re still several years out from any possible revenue that is. And, of course, it’s got to pass the tests.
We recently had the news that the patent has been granted on this: “Tenax Therapeutics, Inc, a specialty pharmaceutical company focused on identifying, developing and commercializing products that address cardiovascular and pulmonary diseases with high unmet medical need, announced that the United States Patent and Trademark Office (USPTO) has granted a new method of use patent for oral levosimendan (TNX-103) in the treatment of pulmonary hypertension with heart failure with preserved ejection fraction (PH-HFpEF), expiring in 2040.” But that’s really just another indication of how early we are n the testing regime - patents come at the beginning, not the end.
Tenax looks reasonably funded. But that can change rapidly - Phase III tests aren’t cheap to run. So, despite what looks like a decent enough 18 month runway there we’d not be surprised if a stock issue and capital raise took place off the back of this share price rise. The big point we’d make here though is that the FDA approval for the testing regime is only worth hundreds of percent on the stock price because Tenax started at such a low valuation, in the handful of $ millions.
