Cell Therapeutics (NAS: CTIC) plunged 25% after pricing a secondary offering of $60MM worth of convertible preferred notes. Originally announced at $40MM yesterday, the dilution is 50% worse than anticipated, converting to a price of $1.40 per share. The money will be used to launch lymphoma drug Pixuvri, and to fund studies of potential myelofibrosis pacritinib.
Fool.com analyst David Williamson labelled Cell Therapeutics a stay-away stock after its drug Opaxio received orphan drug status, and shares popped earlier this week. With shares up double digits, and management's strong history of dilution, it was less than a week before the pop was met with a cash raise. With less than $15MM on Cell Therapeutics' balance sheet, the funds were sorely needed -- but even with the company's improved financial footing, this is one stock that Dave just can't get excited about. For the full story and Dave's expert analysis, be sure to check out the video below.
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The article This Biotech's Well Never Runs Dry originally appeared on Fool.com.
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