Pharmacyclics, Inc. (PCYC) recently announced that it has initiated an underwritten public offering to sell 2.2 million shares of its common stock. The amount represents approximately 3.1% of the total number of shares outstanding at Pharmacyclics. Pharmacyclics will be responsible for selling all the shares. The company also expects to provide the underwriters with a 30-day over-allotment option for an additional 0.33 million shares.
Pharmacyclics intends to utilize the net proceeds to develop its pipeline including its lead candidate ibrutinib. Pharmacyclics is being co-developed with Janssen Biotech, a Johnson & Johnson (JNJ) company, for multiple indications.
We remind investors that in 2012 the company received orphan drug and fast track designations in the US for ibrutinib for the treatment of chronic lymphocytic leukemia. The candidate also enjoys orphan drug and fast track designations for the treatment of mantle cell lymphoma.
In Feb 2013, the US Food and Drug Administration (:FDA) granted breakthrough therapy designation to ibrutinib for treating MCL patients as a monotherapy. The FDA granted a similar status to ibrutinib for treating patients suffering from Waldenström's macroglobulinemia also as a monotherapy. Both the indications are B-cell malignancies. We expect investors focus to remain on the development of ibrutinib.
Pharmacyclics is also developing candidates for the treatment of non-Hodgkin's lymphoma, refractory follicular lymphoma and multiple myeloma. Most of these candidates are in phase II development.
Pharmacyclics, a biopharmaceutical company, carries a Zacks Rank #3 (Hold). Biopharmaceutical stocks, which currently look more attractive, include Array Biopharma (ARRY), Celldex Therapeutics, Inc. (CLDX). Both stocks carry a Zacks Rank #2 (Buy).
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