When a relatively small company ends up striking a deal with a giant corporation, then it generally proves to be a major boost for the stock. That is what has happened this morning with lightly traded micro-cap PULM stock after Pulmatrix Inc (NASDAQ:PULM) announced that it had reached a licensing and development deal with Johnson & Johnson (NYSE:JNJ).
Big Deal For PULM Stock
The deal was actually made with J & J’s Lung Cancer Initiative, by way of which Pulmatrix is going to help create a range of narrow-spectrum kinase inhibitors. It is a significant development for Pulmatrix, and there was a lot of optimism around the stock this morning in the markets.
The lead candidate, in this case, is RV1162/PUR1800, which is going to be manufactured by dry powder technology that has been developed by Pulmatrix.
PULM stock soared by as much as 86% at $1.60 in the morning session as investors piled onto the stock, and it remains to be seen how it performs through the rest of the day.
>> Waitr Stock Bounces As New CEO Eyes Profitability
According to the terms of the deal that have been revealed, Pulmatrix will be paid $7.2 million immediately and a further $2 million after the completion of the Phase 1B study. The medicine is going to be tested on people suffering from chronic obstructive pulmonary disease (COPD).
The Chief Executive Officer of the company, Ted Raad, spoke about the developments and also revealed when he expects clinical data from the trial: “In 2020, we anticipate clinical data from the first of these inhibitors in a disease area with a significant unmet medical need.”
The total payout for Pulmatrix could end up being as much as $91 million if Johnson & Johnson ends up developing this product commercially. Where do you think PULM stock will go from here?
Featured image: DepositPhotos © minervastock
