AP Pharma Submits for a Redo (APPA)

Patients enduring the rigors of chemotherapy know all too well about nauseas side effects of the treatment. In extreme cases, the nausea and vomiting is so severe that it causes a disruption in life or patients opt to discontinue the regimen. Last Friday, AP Pharma (OTC: APPA) announced it had resubmitted a new drug application for a product known as APF530, which supposedly prevents nausea and vomiting induced by the effects of chemotherapy.

On Friday, traders initially reacted positively to the news and buyers sent share prices higher in the morning. However, any euphoria quickly disappeared as the stock slid throughout the day and ended closing out the week on a down note.

Perhaps traders still felt a little queasy so they did not want to rock the boat this morning on the opening bell. Shares prices began the day where they left off before the weekend at $0.62. Buyers appeared to get their legs steadied first and the stock advanced a nickel to an intraday high of $0.67 by the end of the first 30 minutes in trading. Similar to the last few trading sessions, sellers took control afterwards and the stock made a hasty retreat. Shares could not keep their heads above water as the trading day ended. The stock closed the session down two cents, or a loss of 3%, to finish on the low of the day at $0.60. Over 674,000 shares traded on the day, which made the session one of the heaviest volume days since the stock began to trade actively nine months ago. On an average day, the stock trades around 117,000 shares. Traders will have to decide whether or not to follow the pattern of the last few days where it pays to be a buyer early and a seller later.

On September 27, AP Pharma received a vote of confidence in the form of an article on Seeking Alpha. The contributing writer reiterated a buy recommendation made in the spring.

Shares of AP Pharma established a 52-week low about the time the stock appeared on the radar screen in December when shares traded for $0.16. For the next six months, share prices rose almost without interruption. In July, the stock wavered when the company announced a $53.6 million private placement of common stock where AP Pharma agreed to sell 102 million shares of common stock for a price of $0.525 to existing and new institutional clients. A month ago, shares hit an annual high price of $0.78.

Other recent news for the company includes the release of second quarter financial results on August 2, 2012. For the quarter ending June 30, AP Pharma showed a loss of $0.02 per share compared to a loss of $0.05 in the same quarter of the previous year.

In June, the company released its findings from a Phase 3 study involving chemotherapy patients and its drug APF530. The study showed comparable results in patient satisfaction between AP Pharma’s drug and palonosetron.

AP Pharma is a pharmaceutical company that designs and commercializes polymer technologies for pharmaceutical application. Outside of its product APF530, the company has additional programs in the preclinical and clinical stage for pain management and inflammation control. The Redwood City, California, company was founded in 1983.

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Published by Alan Masterson

Alan has over 25 years of trading experience in the U.S. equity markets. He began his career in finance working on a program trading desk specializing in over-the-counter stocks. His career progressed from that point to his current position as senior trader on an institutional trading desk. In the evenings, Alan teaches economics at a local community college. He has contributed articles to various publications over the last six years, including feature articles for an economics magazine and various financial blogs. You may contact Alan via his email (alanmasterson@wallstreetpr.com) or his Google+ page (https://plus.google.com/103338576216002376250).