Option position on CHTP

CHTP has a couple of upcoming catalysts. It has an Ad Comm meeting on February 23rd and a PDUFA on March 28th. The stock was trading at $5.40 at the start of the year but slumped to the $4.30’s after a share offering. It is starting to look like it might be gaining again as it moves towards its catalysts. I have taken a long position on some call options to try to capitalise on the volatility that I expect over the next few days. I have chosen to go long the February $5.00 calls. This is risky as they will expire on Feb. 17th which is 6 days before the Ad Comm meeting. However, they are quite cheap, currently in-the-money, and I expect the shares to appreciate in the next 10 days. I am taking a very small position at $20 per contract (equal to <1% of the total portfolio). If the shares do not appreciate I will lose most/all of this but hopefully the bio rally will keep going to drive CHTP towards $6.


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