Ever since Provention Bio (PRVB) released its groundbreaking results for teplizumab in “at risk” patients for Type 1 Diabetes, the company’s systematically retired risk.

  • First, it eliminated the risk of a lengthy approval process, by securing FDA FastTrack designation in the U.S. and shortly afterwards, PRIME designation in Europe.
  • Second, the company eliminated the potential delay of the drug getting to patients by securing FDA guidance to proceed directly from the Phase 2 results to formal drug approval (BLA application). In the early days, many insisted or feared a Phase 3 study would be required.
  • Third, management retired any financing risk by completing a $63 million raise, with marquee institutional investors, no less, including Perceptive Advisors.

Rightfully so, shares have responded to this progress by rallying strongly from a low of $4 before the data release to a recent high of $18.50.

As far as I’m concerned, one major obstacle remains in the way of shares significantly re-rating again and/or a takeover offer materializing.

The good news? In recent days, this obstacle is systematically being retired, too.

So how high could shares reasonably go? That all depends on the multiple you apply to the annual revenue potential for teplizumab. Regardless, it’s enough to maintain a Strong “Buy” rating on the stock.

Let me explain…


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