Followwill Dorman, a director at Scilex Holding Co (NASDAQ:SCLX), recently acquired shares in the company, according to a regulatory filing. On October 18, Dorman purchased 1,000 shares of common stock at a price of $0.99 per share, amounting to a total transaction value of $990. This acquisition increases Dorman's total holdings to 2,300 shares. The transaction was an open market purchase.
In other recent news, Scilex Holding Company is considering strategic options for its subsidiary, Scilex Pharmaceuticals, including a potential spinoff or public listing outside the United States. This decision is rooted in the belief that Scilex Pharma's value may surpass the current valuation of Scilex Holding, particularly given the promising growth of its FDA-approved products. Sales for its lead product, ZTlido®, are expected to exceed $180 million in 2024.
Scilex Holding also reported growth in Q3 net sales for its non-opioid pain management products, with ZTlido's sales reaching between $11.0 million and $13.0 million. The company recently secured a $50 million convertible note offering with key stakeholders such as Murchinson, 3i (LON:III) LP, and Oramed Pharmaceuticals (NASDAQ:ORMP), Inc. This move is aimed at refinancing existing debt and bolstering long-term growth.
The company extended a payment deadline in its agreement with Oramed Pharmaceuticals and fulfilled a $10 million loan obligation through product delivery to FSF 33433 LLC. Additionally, the U.S. Food and Drug Administration approved updates to the labeling of GLOPERBA®, a gout treatment, for precision dosing. These are some of the recent developments shaping the trajectory of Scilex Holding Company.
InvestingPro Insights
Following director Followwill Dorman's recent purchase of Scilex Holding Co (NASDAQ:SCLX) shares, it's worth examining some key financial metrics and insights provided by InvestingPro to contextualize this insider transaction.
According to InvestingPro data, Scilex Holding Co has a market capitalization of $126.45 million. The company's stock has shown a significant return of 19.84% over the last week, which aligns with the timing of Dorman's purchase. This recent uptick is particularly noteworthy given that the stock has experienced a substantial decline of 50.7% over the past three months.
InvestingPro Tips highlight that Scilex's valuation implies a strong free cash flow yield, which could be a factor in Dorman's decision to increase his stake. However, it's important to note that the company is not profitable over the last twelve months, with a negative P/E ratio of -0.78. This is further underscored by analysts' expectations that the company will not be profitable this year.
Despite these challenges, Scilex has shown revenue growth of 9.41% in the last twelve months, with a more impressive quarterly revenue growth of 30.11% in Q2 2024. The company also maintains a healthy gross profit margin of 68.24%, indicating strong pricing power or efficient production processes.
For investors considering following Dorman's lead, it's worth noting that InvestingPro offers 7 additional tips for Scilex Holding Co, providing a more comprehensive analysis of the company's financial health and market position.
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