Arena Pharmaceuticals, Inc. (ARNA)

[BIDWACKIE]

Article:secondary offering, which might not be the best course of action

<It has been a pleasant surprise to me that the FDA has recently been a lot kinder to traditional small cap, new drug creating bio pharmas, recently recommending Arena Pharma's (ARNA) weight loss drug lorcaserin for approval. I waffled back and forth on that one, before predicting on the day before the drug gained the confidence of an advisory committee, that it would indeed be recommended for approval, and predicted a stock price afterwards of over $6 a share, possibly $7. Arena's stock price hit a pre market high of $7.89 the morning after the approval recommendation. I was very pleased to see long time Arena stock holders hit the small cap bio pharma jackpot, with many becoming instant millionaires overnight. You guys and gals took huge risks, and you have been rewarded, well done.

However, I do want to caution that the decision could have easily gone the other way, and lorcaserin has not yet been approved, and there is no guarantee it will be approved by the FDA regulatory body. Arena has also indicated that it wants to engage in a secondary offering, which might not be the best course of action at this exact moment. I believe the company should wait a bit longer to see if the FDA will request a REM from the company, as they did with Vivus (VVUS) concerning its weight loss drug Qnexa, also recommended by an advisory panel for approval.

It is my strong opinion that Arena longs sitting on massive profit should give serious consideration to selling at least half of their positions, perhaps let the other half ride, and/or buy back at a lower price, because I do think the stock price will retrace back to around $4.50 before the final decision is rendered on lorcaserin. However, you might still feel like taking an even bigger risk; it's your money, do with it as you please. If it was me in the position of many Arena longs, I would be looking for a long term growth investment to put a good amount of my new found wealth in.>


http://seekingalpha.com/article/593851-hitting-the-jackpot-with-small-cap-bio-pharma-investment-part-3-the-immune-system?source=yahoo