A big mover in Clarus Therapeutics (CRXT) today which saw the stock at one point up over 70%! The stock sees an average volume of 1,300,000 shares. At time of writing, over 60,000,000 shares have been traded on April 14th 2022. This is the most volume on the stock since August 2021.
Clarus Therapeutics Holdings, Inc. is a pharmaceutical company with expertise in developing androgen and metabolic therapies for men and women – including potential therapies for orphan indications. Clarus Therapeutics’ first commercial product is JATENZO (testosterone undecanoate). The company is focused on testosterone deficiency, revolutionizing men’s health by focusing on the hypogonadal man.
What does that mean? Male hypogonadism is a condition in which the body doesn’t produce enough of the hormone that plays a key role in masculine growth and development during puberty (testosterone) or enough sperm or both. You can be born with male hypogonadism, or it can develop later in life, often from injury or infection.
The news out today is that Clarus Therapeutics announced the initiation of screening for the first patient in an investigator-initiated Phase 4 clinical trial designed to evaluate the efficacy and safety of JATENZO (testosterone undecanoate) oral softgel capsules for the treatment of adult hypogonadal men with chronic kidney disease (CKD). Clarus expects to announce results from the trial in the first half of 2023.
CEO Dr. Robert Dudley commented, “We are excited screening has begun for the first patient in this trial of hypogonadal men with CKD. Patients with CKD suffer from a myriad of comorbidities, which often include profound reductions in circulating T. Epidemiological data indicate that an estimated two million men with CKD are clinically hypogonadal and thus may benefit from T replacement therapy. This will be the first of several life cycle management studies for JATENZO designed to maximize the potential for treatment of specific patient populations where T deficiency is a component of their compromised health. Because JATENZO increases T levels and has a positive impact on hemoglobin levels, our hypothesis is that JATENZO, with its flexible oral dosing options, could become an important treatment option for hypogonadal adult men with CKD. These men also may prefer JATENZO over other T treatment modalities because it is administered orally as a softgel capsule.”
It is worth noting that Clarus released Q4 and full year 2021 results on March 30th 2022. Annual net loss came in at $40.6 million. Fourth quarter 2021 net loss was $4.3 million. The company states their cash and cash equivalents as of December 31, 2021 will fund their current operating plan into approximately April 2022. Clarus will continue to explore strategic alternatives for the purpose of maximizing stockholder value and expect to devote significant efforts to raise capital, restructure indebtedness and identify and evaluate potential strategic alternatives.
Let’s start off with a broader view. The stock has declined nearly 90% since September 2021 from about $9.00 a share to lows of $0.61. Since then, the stock is showing some signs of bottoming.
Zooming in a bit closer, and we see a time and tested reversal pattern developing. And I stress, developing. It appears the structure of a cup and handle is developing. However, the trigger to confirm a reversal is a daily candle close above $2.00. Still some ways to go. If this breakout does not occur, the stock can fall below $1.00, although this time there is a huge gap acting as support from $1.00-$1.28.
It should be noted that the company will likely be looking to raise cash. This might not be conducive for the cup and handle breakout. Financing will be painful for existing shareholders especially if they bought in at the higher levels sometime last year.