Acura Pharmaceuticals was given the stamp of *approval by the US drug regulator on its novel abuse-deterrent pain killer late Friday (read background). The drug is a co-development product by Acura Pharma and Pfizer and will be sold under the new trade name, Qxecta (previously referred to as Acurox).
Trading roadmap
Given the broadly unexpected downtrend in ACUR's stock price prior to the PDUFA, lots of investors grew increasingly skeptical about the outcome of Qxecta's review by the FDA and initiated short positions to bet against ACUR's drug approval. Hence, without hearing any news from the Palatine, Il-based biotech, many were forced to hold their short positions into this weekend and these people will have to cover these positions on Monday. This, along with the drug approval news, will cause a temporarily spike in share price, which I expect to fade very rapidly. I will take the opportunity to purchase July $5 or $7.5 (if available) put options while ACUR shoots up on Monday. Remember, the price of put options goes in opposite direction of the share price, so put options will likely be CHEAP around the post-approval peak.
Follow me on Twitter for trading updates (@michaeljuan01). Good luck everyone!!!
*Thanks Gekkowire for sharing his personal correspondence with the FDA.
nice
ReplyDelete