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Synairgen plc (LON: SNG) shares have been down 26.3% over the past three days following the release of its six-month interim results on 30 September 2021.
The company’s shares have sold off heavily over the past three days as investors reacted negatively to the loss reported for the six months ended 30 June 2020.
Most of the losses were attributed to research and development costs, which came in at £36.91 million as the company lead COVID-19 drug SNG001 advanced its phase III clinical trial.
Synairgen also invested heavily in its manufacturing capacity as it prepares for the regulatory approval of its SNG001 drug as a treatment option for COVID-19 patients with severe symptoms, given the positive clinical trial results.
The adverse reaction indicates that most investors expected Synarigen to start generating revenues much sooner, which is why they were shocked at the significant losses reported.
However, investors should keep in mind that SNG001 is yet to be approved for use as a COVID-19 treatment by significant regulators, including the UK’s Medicines & Healthcare products Regulatory Agency (MHRA) and the US Food & Drug Administration (FDA).
Despite the positive results reported during phase I, II and III clinical trials, there are no guarantees that SNG001 shall receive regulatory approval any time soon, which explains the massive selloff in Synairgen shares.
Still, there is hope given the ongoing threat posed by the coronavirus pandemic and the emerging variants, which means that the world shall be dealing with COVID-19 for much longer than most experts initially expected.
Since the coronavirus and its multiple variants infect even fully vaccinated people, it underscores the need for a reliable treatment option such as SNG001.
Meanwhile, Synairgen shares have broken below a crucial support level and are headed lower. Aggressive investors may find buying opportunities at lower prices.
*This is not investment advice.
Synairgen share price.
Synarigen shares are down 26.34%, having fallen from their September 29 closing price of 164.4p to today’s low of 121.1p.
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