Innovation Pharmaceuticals Inc (IPIX)

[TOB]

Brilliant chart showing the true Cellceutix corporate development and remarkable success of management by the CEO Leo Ehrlich.

Clinical trials, the lifeblood of bio-tech, have multiplied exponentially in just a few years. All at very minimal dilution based upon the CEO's repeated ability to secure beneficial financing, grants and sponsors. This compares and contrasts very favourably to so many other biotechs whose financing generally have multiple toxic elements absent from Cellceutix's financing deals. (I reference PIPES with large fixed discounts, warrants, absence of protective clauses prohibiting shorting, dodgy financiers, etc. Those who know early stage biotech investing understand)

Amazing progress! Not only have the clinical trials increased exponentially, there have been no failed trials. So far Brilacidin and Prurisol have completed trials meeting their endpoints, and Kevetrin is a near certain Phase 1 success for its primary endpoint. Secondary endpoints for efficacy look promising as well with Cellceutix receiving orphan drug status for ovarian cancer and planning a Phase 2/3 clinical trial. This is a very low risk period IMO, as there are both a variety of clinical trials and no short-term pass or fail catalysts. Risk will increase down the road as we get closer to trial end catalysts.

Obviously the CTIX share price has not yet fully reflected this tremendous progress, despite being up multiples from the 2012 levels. The answers to this mystery are quite obvious. The large sellers which appeared last March when the transfer shares became unrestricted and the pending up-listing status leaving CTIX on the lower volume OTC. The sellers predictable as a known factor, and the pending up-listing status less predictable as it involved the discretionary decision making by NASDAQ. A quicker up-listing decision by NASDAQ could have better absorbed the selling due to increase liquidity on the NASDAQ - volume and a wider institutional and retail market - but that is now behind us.

The pending up-listing to the NASDAQ is likely now weeks away, as opposed to months, and the selling pressure has shown little appetite at lower share prices and may have already dealt with the lion's share of the transfer shares. The former quite obvious, the latter my opinion.

Pending transfers alternatively will be 60% of the prior amount, and similarly restricted for six months once they happen. CTIX will almost certainly be a NASDAQ stock by that time, with much increased trading volume and an increased appetite for shares among the new NASDAQ institutional and retail buyers as the Cellceutix clinical trials continue to progress.

The CTIX chart is now back in the multi-bottom support zone. I can't predict the future (determined by future buyers and sellers), but I like the odds for a rally continuation from this support zone building on the first rally leg break-out. Rally leg pull-backs are common, not unusual. They are stronger when they bounce off of the break-out level, true, but pull-backs of the full rally leg are quite common also, with the chart remaining bullish as long as support holds.

We'll see if CTIX remains in this range or starts a second rally wave up to start approaching a more reasonable share price for CTIX, which IMO is deeply undervalued currently. Alternately, lower prices are always possible, but it would really surprise me to see this multi-month support zone not hold.

You bets your money and you takes your chances. My bet is on the market catching up with the remarkable progress the Cellceutix CEO Leo Ehrlich has made in multiplying clinical trials while keeping financing favourable and at a frugal level.

(Click chart to enlarge)