High-risk junior biomedical stock could be bought by partner.
Alfacell Corp. (NASDAQ: ACEL, Stock Forum) is a down and out biotech that recently went more down and out after its ONCOCASE Phase III study failed to meet the primary endpoints in mesothelioma, a cancer that is almost always caused by exposure to asbestos, as the survival rates only grew from 10.7 months to 11.1 months.
But the drug did show statistically significant results in patients who had failed to see benefits from a prior chemotherapy regimen where life expectancy went from 8.7 months to 10.5 months. This secondary endpoint may be the company's future and it is so small that if that were to become the case will cause its crummy $30 million market cap to become exponentially higher.
Mesothelioma is nothing short of a death sentence. It has no real treatments; it is essentially a "bonus for your hard work" in that it is has generally arisen in workers from asbestos exposure, and there is a real need for the humanitarian aspect even if it is only a two month benefit.
The company is partnered with Par Pharmaceutical (NYSE: PRX, Stock Forum) on this and even if the FDA would allow this to be a second line of defense it might lead to Par just buying the company out. The company will almost certainly need to raise capital as well in the near future. This would be solely for 100% risk-based capital as it's an all or none proposition company.
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