OXGN DD:
15M shares outstading, 20M Fully Diluted
$25M cash, $35M (?) if all warrants/options exercised.
MC (recent price $3.80/share) = $57M, $76M F.D.
Enterprise value = $32M, $51M F.D.
Recently announced trial results in Phase 2, avastin+Zybrestat vs avastin only. Statistically significant Progression Free Survival (PFS) (32% improvement vs control) in refractory ovarian cancer, 100+ pts. Will report Overall Survival (OS) at an upcoming conference. (Note: trial was not blinded)
ECYT recently received recommendation for approval in EU based on a phase 2 combo drug trial of ~150 pts that improved PFS by 25%, but did NOT show statistically significant improvement in OS.
OXGN could apply for avastin/Zybrestat approval in EU based on similar statistically significant PFS results, even if OS is not statistically significant. EU incidence of ovarian cancer much larger than US incidence. (Avastin already approved in EU for Ovarian CA, even though it does not show statistically significant OS)
ECYT currently has a market cap of $1B, OXGN a MC of $57M.
OXGN owns all rights to Zybrestat. Potential to sign significant partnership with Roche (Avastin) or other Pharma.
If OXGN able to achieve statistically significant OS on top of phase 2 PFS results just reported, potential for 3-5X+. Avastin is NOT approved in US for ovarian cancer, so combo of Avastin/Zybrestat would be very valuable to Roche to get approval of Avastin in Ovarian in US.
Downside appears limited because of statistically significant PFS results. Precipitous drop from $6+ on report of results is most likely due to exercise and quick sale of 3M+ warrants for 100% profit.
Downside: Might take a temporary hit if OS is not statistically significant. May need a Phase III in EU. Almost certainly need another trial for US approval.
Disclosure: long from $4.15. Do your own DD.
