After a protracted wait, TG Therapeutics Inc. (TGTX, Financial) shareholders finally got rewarded for their patience last month when the stock began a rapid climb to its current price of $52. That's a gain of nearly 350% in the past year, a bonanza for investors who have owned the stock since late 2011, but only a slight consolation for those who bought in at more than $182 in May 2010.
The boost in share price is linked to the company's announcement at the recent American Society of Hematology meeting when it reported promising phase 3 study data for its drug ublituximab to treat chronic lymphocytic leukemia. Based on the positive test results, TG requested a rolling approval from the Food and Drug Administration for the combination of ublituximab and its experimental drug umbralisib, according to Pharmaphorum. TG expects the submission for the potential competitor to Roche's (RHHBY, Financial) Gazyvaro to be completed in the first half of the year.
TG announced in mid-December a public offering of over 6 million shares of common stock at $43.50 per share. Gross proceeds are expected to be about $275 million. The company plans to use the funds to support the continued development of ublituximab and umbralisib, the potential in-license, acquisition, development and commercialization of other pharmaceutical products and for general corporate purposes, according to a press release.
Ublituximab may also have another use, treating multiple sclerosis, President and CEO Michael Weiss said in an interview with WXpress. MS is a rare autoimmune disease. Normally, antibodies produced by the immune system help protect the body against viruses, bacteria and other foreign substances. In people who have MS, the immune system attacks the body. There is no known cure for the disease, but Weiss believes that real progress has been made in developing new treatment options for MS sufferers and that TG may be offering its own new therapy.
Weiss expects ublituximab will be the third of its type of MS drug to market, following Roche's Ocrevus and Novartis' (NVS, Financial) Kesimpta. He doesn't think any others in the same class are in development for the disease.
Despite the good news on ublituximab, in mid-December analysts downgraded their forecasts for TG next year, perhaps because previous estimates had been too bullish, according to an article in Simply Wall St. So far, the downgrade hasn't had an effect on the stock price and it remains to be seen if it will.
The five analysts following TG expect revenues of $54 million this year and losses of $1.88 per share in 2021. Both represent downward adjustments from previous forecasts. At the same time, the consensus price target was boosted 20% to $56.86, with a high estimate of $70 and a low of $38.
Disclosure: The author has no positions in any of the stocks mentioned in this article.
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