In March I wrote a bullish article on OXiGENE (NASDAQ:OXGN), stating the company was undervalued, but weak financials, poor historical stock performance and a suboptimal manufacturing capacity would impede the company's progression to the cancer market. I argued that these inefficiencies could prompt management to sell the company at a discount relative to what I believe to be the true value of OXiGENE's lead ovarian cancer synergy, Zybrestat/Avastin. After all, OXiGENE has disappointed investors time and time again on many fronts, namely by conducting frequent capital raises and failing to execute properly in clinic.
This week, however, shareholders received some encouraging news: OXiGENE's Q3 earnings report corroborates management's plan to advance Zybrestat/Avastin to a late-stage clinical trial, with an adequate cash position to reach that objective. Precisely, management stated that it expects cash on hand to provide enough runway for R&D through 2016, which includes advancing the Phase 2 study for Zybrestat and GI-NETs, the Phase 1 B2 study in ovarian cancer, the OXi4503 Phase 1 program, and the Baylor University research collaboration. Nevertheless, it is important to note that it is possible, if not likely, that additional capital could be raised before that date. This is one of the many perils faced by micro-cap biotech companies. Shareholders should be aware that capital raises are oftentimes detrimental to the value of the stock.
See full article on Seeking Alpha: http://seekingalpha.com/article/2683765-oxigene-q3-earnings-and-avastin-approval-bull-thesis-reiterated
No comments:
Post a Comment