Biotech Values

[lreichel]

Don't worry about DNDN's issuance, it isn't indicative of anything other than what they disclosed in the registration statement. Cash is king and gives companies ultimate flexibility. You can't pay your bills with FDA approval.

Markets shut down from time to time, even for good companies. If you are in a cash crunch, you have little or no leverage and limited options. I learned a good lesson when I was with Tmobile (formerly Omnipoint OMPT) I kept arguing against raising additional equity until we had the network up and running and had customers on board. We ultimately sold equity at a relatively cheap price, but that allowed us to build a much stronger company. This kept the company from getting a going concern opinion, that would have triggered a default on our debt. At one point we did a 144 debt deal at 17% interest because the equity, high yield and bank markets were closed. If we didn't get that deal done, there would have been a world of pain. With the cash, the company went on to be a great success and a big buyout from Tmobile.

I learned at that point to take what you can when you can, because it won't always be available.