Esperion Therapeutics (NASDAQ:ESPR) [Trend Analysis] today announced that they have completed phase 2 trials of their new small molecule low density lipoprotein cholesterol (LDL-C)-lowering drug candidate, ETC-1002 with very positive results. The drug showed a reduction in cholestrol of between 17% and 24% in patients. As such Esperion announced on the back of these positive results they will advance to phase 3 trials and the stock has shot up some 20%.
With this in mind, we look at 4 important things investors should be aware of regarding Esperion Therapeutics (NASDAQ:ESPR), 2 positive and 2 negative.
1. Analysts are positive on Esperion
According to Zacks research, of the 3 analysts covering Eperion Therapeutics, 2 rate it a strong buy and 1 a buy. With the apparent experts so positive on the ESPR there certainly is reason to be believe their is something in this stock.
2. Strong cash position
Being a company still in the development phase, a strong cash position is imperitive for a stock to be able to continue their trials for their drugs. Esperion last reported over $105 million in cash and short term investments on their balance sheet as of December 31, 2014. With this cash and ESPR having liabilities of only $10 million they are in a strong position to have the cash available to continue trials.
3. Side effects unknown
ESPR is still unsure of the side effect caused by the new drug. This is obviously a large concern should there be any major such effects. Therefore investors should be wary of this before getting too carried away just yet.
4. No Revenue
For risk averse investors, Esperion is obviously still a development stage drug company and as such has no revenues. Such companies are obviously high risk, which investors should be aware of and if they are interested in Esperion as an investment should be sure to have a diversified portfolio should the risk not pay off into reward.
All of the above points are important for investors to be aware of regarding Esperion Therapeutics (NASDAQ:ESPR) and their exciting news. They are in a strong position to continue their research, however, there are of course high risks present.