E Is OxiGene The Cheapest Biotech On The Nasdaq?

Near-term catalysts

Let’s see what near-term catalysts are lined up:

  • The company is to receive FDA guidance in Q2 on the potential design and scope of the Phase III trial for fosbretabulin in ovarian cancer (this is a high-impact catalyst). Depending on what the FDA will say, OxiGene is able to start the Phase III trial.
  • Also in Q2, enrollment in the ongoing Phase 2 study in GI-NETs should be completed.
  • The company has plans to move their second clinical candidate, OXi4503, into a company-sponsored Phase 1/2 study in acute myeloid leukemia (AML), which will increase the number of clinical sites enrolling these subjects. 
  • I expect OXiGENE will receive an Orphan Drug Designation in the EU for OXi4503 regarding the treatment of Acute Myelogenous Leukemia (AML).

The company will also issue updates regarding the recruitment of patients for its other programs. Also, it would not surprise me if the company is to announce a partnership soon. Obviously, any of these catalysts panning out in a positive way could drive the share price much higher. 

Financial condition

OxiGene currently has $40 million in net cash minus Q1 burn. [Market cap and cash figures shown here reflect the $10 million at-the-market offering OxiGene conducted last week.] Given their monthly $1 million burn, I estimate the company is good to go for a long time. It could be that they need to raise more capital in the future because expenses rise when a drug candidate enters the next phase, but short-term I definitely do not expect another raise. Overall, OxiGene is extremely well-financed. 

Peer cancer stocks are valued much higher

OxiGene is with a $40 million market cap severely undervalued compared to many other peer biotech stocks. In the world of cancer stocks, the average valuation of Phase 2 companies is certainly >$100 million. Note that OxiGene successfully finalized a Phase 2 study already, so that warrants a higher valuation too. 

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Disclosure: Long OXGN. Please do your due diligence before investing.

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Comments

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Dick Kaplan 5 years ago Member's comment

$OXGN looks very promising, thanks.

Dan Jackson 5 years ago Member's comment

Excellent article, but "cheap" is a relative firm. Personally, I consider it to be fairly priced:

charts.stocktwits.com/.../original_34689474.jpg

Danny Straus 5 years ago Member's comment

I disagree, after reading the above this looks like a distinct opportunity.