Magenta Therapeutics Inc. (NASDAQ: MGTA) is facing a lethal uphill battle in its fight for survival. This biopharma company saw its prospects flatten after dismal trial results for its flagship candidate.
MGNTA Stock Crash in December
Magenta Therapeutics Inc. (MGTA) suffered a drastic blow in December, after revealing an update on its lead blood cancer treatment candidate. Due to none of the safety parameters qualifying, and other technical indicators pointing to a no-show, Magenta announced its plans to stop dosing its patients with its MGTA-117 candidate. Despite MGTA-117 still in phase ½ dose election trial, all hopes were on this candidate, and the bulk of the value in MGTA stock was intrinsic to the potential of the commercialization of MGTA-117. It, therefore, comes as no surprise when observing the crash that had come about following the news, with MGTA falling from $1.60 to $0.35 in a matter of days.
Magenta’s Aims to Pivot
Following the failure of MGTA-117, Magenta made the announcement that it will be halting all development initiatives it is currently engaged in, and would instead re-focus on developing a sound business strategy moving forward. Although it did not clarify what particular route it will be taking, there was much to suggest that the company may be eyeing a merger, business combination, or some other acquisition deal. However, it is important to note that there is currently no existing plan, and the management is merely considering the possibilities, of its best options to return value to shareholders. Given the crushed ambitions of Magenta, the options of how best to achieve this continue to run thin.
MGTA stock had seen a crashing blow in recent months due to a critical failure which could possibly prove lethal to the prospects of the company. With all options on the table, however, the management is determining how best to move forward and deliver value to shareholders.