2-1-11 News...Radient Pharmaceuticals (Amex:RPC) upgraded from a Hold to a Buy after cash infusion
Feb 01, 2011 (ACCESSWIRE via COMTEX) -- Thomson Financial has announced that Gradient Analytics has upgraded Radient Pharmaceuticals (Amex:RPC) from a Hold to a Buy. Gradient Analytics, which distributes many related products exclusively through strategic alliances with partners such as Thomson Financial and MSN/CNBC Money issued the upgrade on the company after Radient announced that it had been infused with an investment of $8.4 million from five accredited investors on Monday.
"As we stated in the press release, this gives us the capital that we need to start seriously commercializing our early cancer diagnostics test, Onko-Sure," said Douglas MacLellan, CEO of Radient Pharmaceuticals. "Those efforts take advertising, it takes marketing, it takes additional sales help and now we have the capital to do that, which we didn't have before. Additionally, we are anticipating good results out of the Mayo Clinic and those results could help us with marketing efforts, dramatically, here in the U.S. There are simply a lot of great things that this financing allows us to do. Additionally, of course, we are still set to spin off subsidiary Jade Pharmaceuticals (JPI) and our cancer therapeutics spin-off, NuVax . Our team has been working hard to get those transactions done, we're expect news and developments on that front and we think that is going to add a lot of value to our shares."
News of at least one of those spin-offs could come within the next 24-48 hours. Financial advisors to the company have been working to insure that Radient's balance sheets more accurately reflect the value of the two subsidiaries. The spin-offs had originally been announced as part of the company's debt conversion efforts, but have taken on significant importance given recent developments associated with Radient's listing on the NYSE Amex.
"Everyone should recognize that we don't need to use any capital from RPC for those two spin-offs," MacLellan explained after he was contacted on Monday evening. "We're spending this new funding specifically on the commercialization efforts for Onko-Sure and we're excited because we've never raised this kind of money before in one transaction. The investors who put in this money to our company were completely aware of the current situation with the American Stock Exchange and yet they did not perceive that as a serious risk to their investment. They are focused on the commercialization of Onko-Sure as the best new in vitro diagnostic (IVD) cancer test to be cleared by the FDA as the bet that they are making. They're also looking at our trading volume as a significant indicator that there are more and more people becoming aware of our company. Media attention is increasing and we think it's a positive thing as well. These financial investors are focused on those types of things as we go forward we should see even more investors come to our company who care about saving lives by detecting cancer early. These investors are saying, 'you guys have a reasonable business model that seems predictable and so therefore as investors we are happy to put substantial money into your efforts. From their standpoint, they see a company that has their legs on the ground and is working towards a good future. The trading in our common stock has indicated to them that we have a business that people like. They think that we are on to something."
MacLellan and his group were contacted by several large banking and investment firms during the last few weeks. They opted, instead, for a private equity financing after careful consideration and analysis of the offers.
"We are a small cap company and suddenly we're being chased by all sorts of investors because there has been an increase in the awareness of our technology and because we have very high liquidity," MacLellan said. "Historically, the investors in our note offering did very well. New investors saw that and took note. What we tried to do was protect our shareholders by making sure that we improved on the types of discounts and floors associated with our financings. So this financing is at a much higher floor than any we've done previously-- even after our announcement related to our listing on the American Stock Exchange. I think that should generate a significant amount of confidence from investors. It signals to them that the risk has gone down significantly and that the quality of the investor has improved as we've converted an enormous amount of debt.
"We believe that we can continue our Amex listing. Obviously it's a decision that they have to make, but we think that we fully qualify. We feel very bullish about that and have no indication that based on the conversion of debt and everything else, that won't take place. Rather than focusing on any interim reports which we have provided, the Amex has referred back to our third quarter results. I think the markets are telling us, from a liquidity standpoint, that investors are still willing to invest and they did it at better terms than they ever have with us."
Copyright 2011 ACCESSWIRE
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As of Friday, 01-28-2011 23:59, the latest Comtex SmarTrend? Alert, an automated pattern recognition system, indicated a DOWNTREND on 01-07-2011 for RPC @ $1.03.
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