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rofgile (52.37)

DSCO still on track to file in Q3 and hope for approval in Q1 2012

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May 12, 2011 – Comments (3) | RELATED TICKERS: DSCO

Hi all,

 Just thought I'd note that DSCO had their earnings two days ago, and commented on the status of their work and timeline.  

 * FDA required that DSCO make multiple batches of Surfaxin to increase their sample size for data collection.

 * DSCO has now made 8 batches, only 2 more to complete.  So far so good and on track.

 * DSCO is still filing complete response in Q3 2011

 * DSCO is hoping for approval in Q1 2012.

 * DSCO cash flow out is reduced, they have enough cash to sustain through the approval process.

 For the quarter ended March 31, 2011, the Company reported a net loss of $3.8 million. Excluding accounting for non-cash items related to depreciation, stock-based compensation and the change in fair value of certain outstanding warrants accounted for as derivative liabilities, the first quarter 2011 loss was $5.4 million.

 With over $27 million in cash on hand now, and a burn rate of $4 million/quarter, they can go another 3 quarters without an additional equity offering.  

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 This is all excellent news.  Share prices now rising (finally).  We went from 1.90 before the report to now 2.44, an over 20% move with decent possibilities of further climbing.  

 DSCO also recently presented data at a large conference, another sign that things are going well. 

 -Rof 

3 Comments – Post Your Own

#1) On May 12, 2011 at 1:08 PM, portefeuille (99.75) wrote:

DSCO also recently presented data at a large conference

see comments #31,32 here.

 

They also mentioned the cash they receive should those 10 million "fifteen-month warrants" to purchase 5 million shares at $2.94 be exercised (they mentioned "$15 million" in additional cash).

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On February 16, 2011, Discovery Laboratories, Inc. (the “Company”) entered into an Underwriting Agreement with Lazard Capital Markets LLC, as the sole book-running manager, and Boenning & Scattergood, Inc. and Global Hunter Securities, LLC, as the co-managers (collectively, the “Underwriters”), related to a public offering of (i) an aggregate of 10,000,000 shares of common stock, par value $.001 per share (“Common Stock”), (ii) five-year warrants to purchase an aggregate of 5,000,000 shares of Common Stock (the “Five-Year Warrants”) and (iii) fifteen-month warrants to purchase an aggregate of 5,000,000 shares of Common Stock (the “Fifteen-Month Warrants” and together with the Five-Year Warrants, the “Warrants”).  The shares of Common Stock and Warrants are being sold as units (“Units”), with each Unit consisting of (i) one share of Common Stock, (ii) a Five-Year Warrant to purchase 0.50 of a share of Common Stock and (iii) a Fifteen-Month Warrant to purchase 0.50 of a share of Common Stock, at a public offering price of $2.35 per Unit, less underwriting discount payable by the Company (the “Offering”).

...

The Five-Year Warrants to be issued in the Offering will generally be exercisable for a period of five years from the date of issuance at an exercise price of $3.20 per share.  The Fifteen-Month Warrants to be issued in the Offering will generally be exercisable for a period of fifteen months from the date of issuance at an exercise price of $2.94 per share.

...

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(from here)

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#2) On May 12, 2011 at 1:12 PM, portefeuille (99.75) wrote:

DSCO shares are currently my second largest position behind EMC shares and warrants and the largest position in my "fund" (currently 580000 DSCO shares with break-even of around $3.24, see here).

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#3) On May 12, 2011 at 1:25 PM, Momentum21 (91.60) wrote:

Miller did a great job on that call...Amick not so much...

Overall I think it was solid. No delays and no dilution please. : ) 

GL Rof 

 

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