Fennec Pharmaceuticals (FENC), mcap=$180m, price $6.75 vs $5.65

Pitch:
– Small-cap pharma with its NDA was rejected 2x by the FDA due to deficiencies at the third-party manufacturer.
– No issues with the drug’s safety or efficacy.
– The same manufacturer caused CRLs for other companies as well.
– NDA resubmitted referencing a new third-party manufacturer.
– High likelihood of FDA approval.
– Potential takeover candidate post-approval.
– PDUFA date on 23rd of Sep’22.

Valuation:
– Trades 42% below pre-CRL announcement levels.
– Post-approval assuming TAM of $420m and 50% penetration gives $210m annual sales in 3 years.
– At 3x that’s $21/share.

Exp. gain: +250% to $21/share in 3 years.

Full $FENC write-up (free guest account required):
https://www.valueinvestorsclub.com/idea/FENNEC_PHARMACEUTICALS_INC/2378105583

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