I agree with their take and added another 5,000 shares at 5.62. Yes, I know I am down at the moment. I think this one has huge room to run in the coming weeks. I am extremely grateful and surprised by today's gift.
Reports 1Q; Looking Forward to Full Ph.II NSCLC Results for '197 at ASCO '10 PT: $11
SUMMARY On 5/6 ARQL reported 1Q10 EPS of ($0.22) vs. our ($0.21). More importantly, ARQL will present full ph.II ARQ 197/Tarceva data in NSCLC as a late-breaker at ASCO on 6/5. Based on positive topline data and '197's profile in prior studies, we believe the detailed results will be compelling and support ARQL's moving aggressively forward with a ph.III program. While we view '197 in NSCLC as the key value driver for ARQL, we believe there is a reasonable chance of success for the '197/Nexavar ph.II HCC trial, which is not reflected in ARQL's current valuation, according to our analysis. We think the '197 results at ASCO will be a major positive catalyst for ARQL, and we would buy the stock ahead of the meeting. KEY POINTS n 1Q EPS was ($0.22) vs. our ($0.21) est. Revenue was $6.3M vs. our $6.9M est, and opex was $15.7M vs. our $16.6M forecast. ARQL ended 1Q with ~$107M in cash, net of ARS-collateralized debt, and expects to end '10 with $70-74M. We believe this is sufficient cash into '12, excluding potential '197 milestones. n OS results for '197/Tarceva in NSCLC may be reported at ASCO. If not at ASCO, we would expect OS data soon after, based on our discussions with ARQL. Given the trial size and pt crossover, we believe statistically significant OS improvements are unlikely, but given the substantial PFS benefit, we expect a positive trend. n We expect ARQL to begin a ph.III trial of '197/Tarceva in non-squamous NSCLC by YE10. We believe ARQL is making progress toward finalizing ph.III plans. Based on topline ph.II results, we believe a ph.III trial in non-squames has a high likelihood of success. We also view this as the most rapid path to market for '197. n We view ARQL's conservative approach to non-'197 pipeline development positively. ARQL will move forward with a single program from the company's early pipeline that includes ARQ-621 and the B-RAF/FGFR inhibitor programs. We believe these early programs have promise, but we believe ARQL is appropriately focusing a majority of its resources on '197, currently.