+ Watch OGXI
on My Watchlist
Cancer Bio---had a secondary offerring which dropped it down to these levels. Missed it the other day at a lower price, but feel confident in the long term prospects for the company.
After months of steady state, OncoGenex gapped up in May on an apparent burst of pre-ASCO excitement, only to steadily degrade below their prior trading range. I'm not expecting any major catalysts in the near term for OncoGenex. The SATURN phase III trial of OGX-011 as second-line treatment of CRPC and the SYNERGY phase III trial of OGX-011 + standard of care as first-line treatment in CRPC both began in mid-2010 and are unlikely to generate significant interim data in the near term. A phase III trial of OGX-011 (custirsen) in NSCLC and a phase II trial of OGX-427 in metastatic bladder cancer are planned for later this year. The cash position is solid and the burn rate has remained low. It could take a while, but I expect this pick to ultimately give me score leadership for OncoGenex.
OncoGenex today sports a $110 million enterprise value with less than 10 million shares outstanding. That's not very expensive for a company with a late-stage cancer drug, even one that's already partnered.
Higher volume makes this stock price increase
This stock and company is undervalued based on available cash of $47 Million, will carry OGXI into 1012. Any good news on any of the three trials will bring the stock out of the down turn. Only 7.2 million shares outstanding fully diluted. High priced options expiring this quarter.
Easily a $20.00 plus stock given the deal with TEVA.
Admittedly I've done little research, but UltraLong wrote a convincing case so I'm riding the coat tails.
Here are 10 reasons1) Past experience with Sonus drugs are not relevant to current story -- ISIS licensed technology2) Revenue doesn't matter when it comes to evaluating young biotechs in this stage of development (didn't think I'd have to mention that, but read other's comments here)3) Significant overall survival advantage compared to docetaxel in controlled Ph2; this is as close as a gimme as you get for the ph3 hitting its endpoints. It really says a lot that the investigators crossed patients from the control arm to receive OGX-011, a drug with so little clinical experience (ie. its obvious this thing works!)4) Extremely well executed ph2 trial; the fact that they teased out OS analysis should put faith back in company. They did very nice risk stratification in their analysis, that further reduces my risk in this investment :) 5) Not 'unproven', first in class drug. This is what oncologists want -- new weapons!6) Despite recent run-up market cap is extremely low. Please look at competitors, CGRB is a good start (prostate cancer drug in similar stage of development, however no controlled trial and no known survival benefit).7) SEC filing related to CGRB purchase said there were many suitors and multiple bids for company with one offer of 1B.8) Rationale for very broad use in cancer lays the foundation for megablockbuster potential. This improves the efficacy of chemo! Lung and breast cancer are next.9) Makes you wonder what other ISIS licensed technology is being developed in oncology (oh yeah OGXI owns that too)10) Oncology due to lack of generic encroachment is a major therapeutic focus of big Pharma that must grow revenue with drugs outside of their own pipeline. Look at Pfizer story which wants Onc rev of greater than 25B in less than 10 years. They can not do it with their own/Wyeth pipeline and will need to purchase or license from other companies.
$100 million market cap is too low for a promising phase 2 drug.
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