Today this pharmaceutical stock announced positive results for a phase 1 trial. Several days ago it signed a partnership with another company to distribute this breast cancer drug, but part of the agreement is that ONTY pays the company over 100 million dollars for the right to do so, plus other payments to them down the pipeline.
Today things are really rosy because ONTY is announcing at a conference, rooting around looking for investors to help it develop the drug.
Lets ready between the lines here:
1) The are only in Phase 1 testing. Thats like being a 4 year old in preschool
2) Positive preliminaries only. FDA still has to approve Phase 2-4. At any time this could be canned by the FDA and then its back to the drawing board or onto something else that looks promising.
3) Its showtime with it announcing prelims at a conference. So what. Its just shaking the tree for publicity.
4) The agreement that it entered in with the other company (Array BioPharma) will at the beginning, suck money out of ONTY. Kinda like you getting scouted to be a model, but you have to pay 200 dollars up front to get your pictures taken.
ONTY Dec 2014 2.000 put (ONTY141220P00002000)
-OPR
0.43 0.00(0.00%) 1:57PM EST
| Prev Close: | 0.60 |
|---|---|
| Open: | 0.50 |
| Bid: | 0.40 |
| Ask: | 0.50 |
| Strike: | 2.00 |
| Expire Date: | 20-Dec-14 |
So we are in for the Dec expiration...it could be a bit dicey as exp. is at the end of next week, but making money is all about risk. If the put option does drop, it could be significant gain.
Risk it for the biscuit or continue to sit in your drab cubicle worrying about your bills,
Mark
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