Interesting dilema. 427 is the superstar drug. don't want to keep it on the sidelines. but personally I don't want to see any further dilution until after 011 tests come out. Maybe phase III test in 427 will coincide with release of 011 data….perfect storm. Maybe not. However, it is interesting situation to have 011 and 427 coming along in so many indicators. Dilution doesn't look so bad if both drugs take off.
I certainly hope that if the share price doesn't go much higher than it is now before the SYNERGY results they won't do a secondary. Their latest 10-Q says they expect the randomized P2 bladder trial for 427 to complete enrollment in the second half of 2013 so they should have data on that one probably a few months after they announce SYNERGY data. If SYNERGY fails but the 427 bladder trial succeeds their market cap should go back up to where it is now, give or take, so they could partner 427 and/or do a secondary then. If both SYNERGY and the bladder trial fail they'll have trouble raising money but you have to wonder in that case if it would even be worth continuing with other 427 trials. I'm sure they'd say yes though which I guess is the argument for doing an offering pre-SYNERGY.
IMO, 427 data must be looking really good and management has decided to develop this drug thru P3. I know we will be getting 427 P2 data in late Q1 or early Q2 ...... the stock price @$12 is starting to look cheap to me. With this fiscal cliff crap hanging over the market maybe I get a chance to steal some cheap shares from some nervous nelly investors.
This is the only reason that they would need addition financial $$$$ resouces. $70/80M for P3 427 trials.
I think a shelf filing is good for two years so it's possible they're not planning an offering in the near future and just want to be ready if and when they decide to do one.
Interesting question whether they'll do one before they announce SYNERGY data late next year. They say they have enough cash to last into 2015, which gets them through SYNERGY and the P2 trials for 427 in prostate and bladder and probably most of the way through the planned P2 trial for 427 with abiraterone in prostate. After the end of this year, Teva will fund all remaining costs of the P3 trials for 011 including SYNERGY and the other trial in prostate with Jevtana and the lung trial, as well as any other 011 trials Teva approves. If SYNERGY is successful, the milestones and royalties OGXI will get from Teva might be enough to fund the additional planned P2 trials for 427 in lung and pancreatic and possibly a P3 for one or more 427 indications. But if SYNERGY fails, OGXI will have to raise money at a time when the pps will have taken a hit. And it will have to do that even if it decides to partner 427 and the partner funds most of the cost of P3 trials. So my guess is that they'll play it safe and do an offering before the SYNERGY data are known.
I don't think it will happen right away, especially given the drubbing the pps has taken in large part because of the fiscal cliff situation, but I've been wrong before.