Midatech Pharma Plc (NASDAQ:MTP) closed on Tuesday’s market at $1.47, which was up $0.63, or 75%, from the previous closing price of $0.84, giving the company its first stock hike since November 2017. The company has been on the decline for the past 6 months, so the question becomes – is this a turnaround point for Midatech, or is it simply part of the daily fluctuations witnessed by stocks?
This particular stock jump, which at its highest leaped to $2.46 on the Nasdaq market today, seems to be related to the company’s announcement that it had entered into a four-year senior secured loan agreement with MidCap Financial. The loan is good for up to $15 million, with Midatech receiving an initial $7 million tranche. Future tranches will be provided if Midatech achieves its goals for its clinical projects. Midatech will use any and all funds it receives from MidCap to fund these projects.
Jim Phillips, the CEO of Midatech, said, “this agreement allows us to continue the clinical development of key products. With the extensive due diligence that was required, it also indicates significant support in Midatech’s future. With our lead programmes heading towards potentially significant, value-driving inflection points in 2018, and the continued progress of our R&D pipeline and US commercial activities, this is an exciting time for the business.”
It’s an encouraging sentiment and so far investors seem to think it’s worth their business. Whether this is enough to pull Midatech’s stock back in an upwards direction still remains to be seen, but there is a strong possibility of this, based on how today went. Obviously, that much of an increase isn’t going to be replicated every day moving forward (the announcement isn’t big enough for that), but the stock will likely move, inch by inch, back up to some degree. And if Midatech manages to achieve its goals through the help of this loan, then it may even be able to regain the momentum it lost over the last 6 months.
Featured Image: twitter
