PARD - I agree that an entry point at this price can be considered risky. Cash on hand is only about 45 million so the share price will likely drop to around 1.5 if results are not stat sig. I was lucky enough to get some when the share price dropped to around $4 a few weeks after ASCO though I have some shares in the 6-7 range as well. I will not be buying any more and instead am focusing on hedging myself but if there are others who got in earlier or at the same time i did I would like to know what they think.
However even for people looking to get in now, odds are stacked in PARD's favor. The treatment arm patients will receive the drug picoplatin plus best supportive care (BSC) while the second arm will only receive BSC, which means they will not get any type of chemo. The standard survival period for patients on BSC is 13-14 weeks based on historical data from past clinical trials. Picoplatin in previous ph II trials demonstrated a range of 27-36 weeks for patients who were refractory and platinum resistant or sensitive. To achieve success pico just needs to demonstrate around 19 weeks survival assuming BSC survival is 14 weeks as expected. There is no reason to believe patients on BSC will survive longer than 14 weeks especially because they will receive no chemo. Based on what management said, to achieve 19 weeks the 320th event, which was the trigger for the data to be collected, should have occurred sometime between july and august and instead occurred in mid september which likely means that the Pico arms survival period was around 26-28 weeks.
As for the marketcap, 2nd line SCLC is about 400 -600 million worldwide. Once 2nd line is obtained there is the potential for off label 1st line because pico has a pretty clean safety profile which potentially doubles the market. The drug also showed efficacy in CRC and CRPC which are much larger markets. According to management there are 4 other indications they want to look at. Other than SCLC other indications are several years away.
Pico is an orphan drug and has fast track so this drug could be selling sometime next year. So if the trial is successful I expect at least a market cap of 500 million and maybe more than 750 million if the survival exceeds 27 weeks. PARD will likely partner or even sell itself for the right price which could mean a much higher marketcap.
