What happened
Tonix Pharmaceuticals (TNXP 0.90%) had to swallow a spoonful of awful medicine on Monday. The company's stock tumbled by nearly 9% following the release of its latest set of quarterly results.
So what
For its first quarter, Tonix -- a pre-revenue biotech -- posted a net loss of $26.7 million, or $0.05 per share. This was deeper than the nearly $20.7 million shortfall in the same period last year. The difference was due to higher research and development expenses and general and administrative costs. Both grew by roughly $3 million apiece over that one-year stretch.
Image source: Getty Images.
According to data compiled by Yahoo! Finance, the few analysts tracking Tonix's stock were collectively expecting that $0.05 net loss.
As is standard for biotech companies in relatively early stages of development, Tonix also provided an update on its pipeline programs. In the earnings release, the company quoted CEO Seth Lederman as saying:
"By the end of this year, we expect to have five central nervous system (CNS) programs in the clinic, led by our most advanced program, TNX-102 SL (cyclobenzaprine HCl sublingual tablets) for fibromyalgia, which is in mid-Phase 3 development. Enrollment has begun for TNX-102 SL in a registration-enabling-Phase 3 clinical trial. TNX-102 SL trials in Long COVID and PTSD are also expected to initiate enrollment in the second quarter of 2022."
Now what
None of this is particularly alarming -- in fact, it's quite encouraging that the promising TNX-102 SL is going through its paces in a late-stage trial. Yet in today's deep bear market, nothing less than a home run will move the needle on many stocks, and that's doubly true for pre-revenue biotechs.
Tonix didn't deserve the drubbing it took on Monday, and investors interested in the sector should take a hard second look at its stock.
