Innovus Pharmaceuticals Inc. (OTCMKTS:INNV) Continues Its Drop

The two announcements that Innovus Pharmaceuticals Inc. (OTCMKTS:INNV) made in the very first sessions of this month’s trading managed to purchase it a brief respite, but now it is crashing hard once more.

After all, it the news that INNV will seek regulatory guidance from the United Kingdom’s MHRA as a Reference Member State in Europe before submitting its European application” for its product and that it “plans to launch a new product into a multi-billion dollar market in the near-term” are enough to draw attention to the ticker for a short while, but not enough to allow it to make a lasting recovery.

At the end of the day, these press releases did not announce that the company has reached a milestone or managed to achieve something significant – rather, they claim that a company is planning on attempting something in the near future.

As we all know, the old expression “talk is cheap” is especially true on the OTC Markets. Vague and boastful, but ultimately – meaningless PR is more often the norm, rather than the exception. This is why the announcements of underachieving penny stock companies in particular, should be taken with a pinch of salt – and, if its financial reports to date are anything to go by, INNV fits into the above mentioned category perfectly:

  • cash – $32 thousand
  • total current assets – $378 thousand
  • total current liabilities – $3.56 million
  • Q1 2016 net revenues – $224 thousand
  • Q1 2016 net loss – $1.55 million

While they are certainly not the most abysmal results that one could find on the OTC Markets, these numbers are objectively bad, and it only gets worse when you start looking into the report more carefully. Digging a bit deeper reveals that INNV currently has $1.32 million worth of convertible notes issued and outstanding, and all of that debt can be transformed into shares of the company’s common stock at a price of $0.15 a pop.

Which is why INNV is crashing once more now – the forces that kept it up are ephemeral, while its shortcomings are very real, can’t be compensated for with bold words, and don’t seem like they are going to go away. Investors need to take that into consideration and act accordingly.

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