The Silver Lining To Pernix Therapeutics Holdings Inc. (NASDAQ: PTX)’S Dark Cloud


Pernix Therapeutics Holdings Inc. (NASDAQ: PTX) reported disappointing results in 1Q2016 and the market reacted angrily. But those who know are aware that you don’t judge a pharmaceutical company by its past, but the future. Does Pernix have a future that you can believe in? Who else is showing faith in Pernix’s future?

1Q2016 earnings deteriorate

Pernix Therapeutics Holdings Inc. (NASDAQ: PTX) has been struggling with healthcare reimbursement issues and 1Q2016 somewhat demonstrated that the company still faces difficulties. The EPS loss of $0.35 widened significantly from EPS loss of $0.11 in the corresponding quarter a year ago and fell short of the consensus estimate of EPS loss of $0.06 by a wide margin.

Revenue reading of $32.5 million for 1Q2016 shrank from $33.89 million a year ago and missed the consensus estimate of $44.55 million. Sales of Pernix’s core brands also weakened on a YoY basis.

2016 guidance pulled down

The withdrawal of 2016 financial forecast didn’t help matters as investors read more trouble ahead for the company. But management disagrees. According to Pernix’s CEO, Doug Drysdale, the future of the company is bright and the company will update 2016 guidance after it concludes the rollout of certain initiatives.

Drysdale said that they expected Pernix Therapeutics Holdings Inc. (NASDAQ: PTX) to post growth across its core brands in the balance of 2016. The launch of Pernix Prescriptions Direct (PPD) program is particularly expected to play a major role in the anticipated growth. More than 10,000 patients have been enrolled into PPD program, which the management said was driving higher refill rates than retail.

Who else believes in Pernix?

A number of institutional investors have recently disclosed stakes in Pernix Therapeutics Holdings Inc. (NASDAQ: PTX). Steven Cohen’s recently reported owning 3.72 million shares in the company, representing a stake of 5.8%. Stonepine Capital LP also initiated position in Pernix in 3Q2015, taking up 3.74 million shares that represent 6.1% ownership in the company. Broadfin Capital LLC also disclosed a nearly 10% stake in Pernix.

Promising drug assets

Pernix Therapeutics Holdings Inc. (NASDAQ: PTX) has three valuable drugs for chronic pain, insomnia and migraines, which some analysts believe could make it an attractive buyout target. As such, the institutional investors buying into the stock are said to have their eyes set on future buyout of Pernix.


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