Think fair value would be around $400-$500MM mkt cap given the clinical data and the indications that they are targeting. We will see this valuation before the data in mid 2013 imo. Of course if the data is positive then it can really run (closer to $1B) as someone will make a bid for this given its elegant drug delivery mechanism for other indications.
Think another reason that the new CEO brought funds in is to protect the company from any hostile attempts given the low valuation. He is probably gathering up the funds to align his support if their is such an attempt as a suitor would need to factor in more shares o/s and probably need to get Board approval. If it were hostile attempt the price would need to be north of $15 to get any attention imo. We may be above $10 in a few days....=)
Also think that CEO has an ace up his sleeve as these deals with funds especially at market prices often are followed by some sort of news/announcemnt that gives a lift to the stock. Lets wait and see what happens. This should get interesting as this company is on the radar screen with many funds including some of the the largest mutual funds. My advice for what its worth is always hold a core position as if you try and trade you may make some change here and there but will miss the large run-up. Once you get out it is very hard to get back in...
I have a good feeling here but of course I would take being lucky vs being good investor any day. Thus, good luck to all longs in this and other positions!