David Einhorn (Trades, Portfolio) on Tuesday reported buying a stake in gene therapy company NeuBase Therapeutics (NASDAQ:NBSE) followings its merger with Ohr Pharmaceutical. Neubase also disclosed Greenlight’s involvement in a press release announcing the close of its merger several days earlier on July 12.
Shares of the combined NeuBase tumbled 7.33% to $4.30 in Wednesday trading, and are down 22.5% since they began trading on the Nasdaq Tuesday.
Einhorn agreed to purchase a 9.12% stake in NeuBase immediately after the completion of the merger in a private placement that closed July 15. At an opening share price of $4.10 on July 12, Einhorn’s investment in the company totaled around an estimated $6.3 million, a small portion of his $1.41 billion long equity portfolio’s value. NeuBase did not report the price per share Einhorn paid in the deal.
“We are excited to be investing in NeuBase, given its initial focus on neurological disorders, and we believe its unique, next-generation technology may offer great help for victims of some of the most difficult to treat diseases,” Einhorn said in a statement.
He rarely invests in health care stocks. It represents the smallest sector of his portfolio at 1.88%, and his only holding is a drug manufacturer, The Medicines Co. (NASDAQ:MDCO).
NeuBase focuses on gene silencing therapies to treat rare, genetic neurological diseases through an antisense peptide nucleic acid platform. It plans to first target Huntginton’s disease and myotonic dystrophy. Ohr Pharmaceutical previously targeted ophthalmologic therapies for diseases such as macular degeneration.
Prior to the merger, Neubase was a private company. The combined company has reported its financials as of March 31, which included $2.3 million in cash, down from $3.75 million at Sept. 30. Its total liabilities totaled $624,676 million, versus $724,998 for the same periods. The company reported a net loss of $2.93 million, or a loss per share of 40 cents, reduced from $2.19 million, or 77 cents loss per share, a year earlier.
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I’m a financial journalist with a Master of Science in journalism from Medill at Northwestern University.