Biovest International, Inc. (PINK:BVTI) stock price broke the support and rolled down 16% on Thursday under a heavy trading volume in reaction to the unregistered equity sale by the company.
The stock was floating high since the company filed its financial results with the bankruptcy court in late February, 2010.
The company has issued a warrant to purchase up to one million shares at a price of $1.21 per share. This was done in order to pay the lease for the company’s facility in Minneapolis.
Biovest only recently emerged from bankruptcy with a confirmed plan of reorganization and should have at least several millions in liquid capital from the sale of Debtor In Possession Secured Convertible Notes in October for a total of $7 million in principal amount. [BANNER]
Despite the fact that BVTI managed to finally emerge from bankruptcy, its main drug BiovaxID for the treatment of non-Hodgkin’s lymphoma is being heavily criticized for the results of the previous Phase III trials. The company might need to rerun the study on BiovaxID, as the post-hoc lgM protein analysis was made retrospectively and may not be accepted by the FDA when the company files for approval.
BVTI financial possibilities to rerun the trials are very questionable and if the share price continues to decline the ability to raise more funds will be limited as well. Biovest filed for chapter 11 protection in 2008 because it didn’t manage to find interested investors.
