If you are not a millionaire now, but would like to become one, there is a well-trodden path to this. Just buy small business pieces that will get much bigger.
Aspiring millionaires are attracted Tonix Pharmaceuticals (NASDAQ: TNXP), a small clinical-stage biotechnology laboratory that is developing potentially new drugs that could cost billions of dollars.
Could this company’s new funds for fibromyalgia and COVID-19 make millionaires out of brave new investors? To answer this burning question, let’s start with the lead candidate for this clinical company.
Lots of good news
Tonix Pharmaceuticals does not yet have income-generating assets, but that could change if its main candidate, TNX-102, gets approval for fibromyalgia treatment. This chronic nerve pain disorder affects millions of American adults, and new and improved treatments could generate billions in annual revenues.
In a Phase 3 study, patients with fibromyalgia treated with TNX-102 achieved significant pain relief compared to patients treated with placebo. Sleep disturbance is a serious problem for fibromyalgia patients, which is why the researchers evaluated this result as well. When it comes to sleep quality, the TNX-102 knocked him out of the park.
Tonix also caught the eye of many in March this year for the positive data from its COVID-19 vaccination program. The leading candidate for the TNX-1800 vaccine knocked it out of the line in a preclinical study. All four subjects who received TNX-1800 were protected from infection, while all four subjects who received a placebo tested positive for COVID-19.
Come on seriously
For companies like Tonix Pharmaceuticals, Operation Warp Speed is over. This company will not receive a ton of money from the US government to develop TNX-1800 or any new COVID-19 vaccine.
Tonix Pharmaceuticals lost $ 50 million last year and it is not known when the bleeding will stop because we still do not know if TNX-1800 has a chance of getting FDA approval. The company has yet to introduce a candidate vaccine to humans.
What’s more, TNX-1800 uses a drug delivery method that will require further verification by the FDA. Tonix Pharmaceuticals uses the hollowed-out shell of another virus, equinepox, to deliver genetic blueprints that should induce human cells to produce part of the virus responsible for COVID-19. If this sounds familiar, it is because vaccines against AstraZeneca (NASDAQ: AZN) as well as Johnson and Johnson (NYSE: JNJ) rely on similar technology.
The coronavirus vaccines from AstraZeneca and Johnson & Johnson are the first viral vector vaccines to be used after clinical trials, and so far they are not doing very well. Before the FDA approves TNX-1800 injections for millions of healthy people, it will take much longer than investors are likely to be willing.
The most advanced new candidate from Tonix Pharmaceuticals, TNX-102, is essentially new packaging cyclobenzaprine. Cyclobenzaprine was first approved by the FDA in 1977 and belongs to a powerful class of drugs widely used to treat depression and other chronic conditions.
Today, the use of cyclobenzaprine is limited to short-term relief of muscle spasms. This is because clinicians need to closely monitor patients taking cyclobenzaprine for signs of abuse and unintentional overdose, which can be fatal.
While the TNX-102 is now in the later stages of testing, Tonix will have a long and tough battle ahead. TNX-102 was designed to be held under the tongue to increase its effectiveness, but this will also raise FDA concerns about its potential for abuse.
Tonix Pharmaceuticals provided no evidence that sublingual TNX-102 is an acceptable treatment option for chronic conditions requiring long-term use. This makes his definitive approval of fibromyalgia highly unlikely without the successful results of a long-term safety study aimed at combating addiction.
Tonix Pharmaceuticals has dragged its shareholders into a long, tedious upswing that you don’t want to get involved in. More misguided enthusiasm can quickly lift it, but investors are better off looking for better biotech stocks to buy.
This article represents the opinion of an author who may disagree with the “official” position of the Motley Fool premium advisory service. We are colorful! Bidding on an investment thesis – even our own – helps us all to be critical about investing and make decisions that help us become smarter, happier, and richer.