Regado Biosciences (RGDO) has halted permanently a 13,000-patient phase 3 trial of Revolixys Kit, its two-component anticoagulant system, after serious allergic reactions were seen in the first 3,200 patients enrolled. The REGULATE-PCI trial was voluntarily paused early in July before being put on clinical hold by the FDA. RGDO is down 50% in the pre-market on Monday morning to $1.40, trading below its cash balance.
The rate of serious allergic events associated with Revolixys, according to an independent Data Safety Monitoring Board, was frequent enough that they recommended Regado discontinue enrollment in the REGULATE-PCI. Regado is beginning a review of the unblinded database and believes the company should have results in a few months.
Similar to Affymax (AFFY) and Omontys in early 2013 (read the obit), RGDO has a slim pipeline to turn to, exemplifying the risks of investing in early drug developers reliant on a single asset to drive value. Regado’s only other pipeline product is a phase 1 injectable version of Revolixys.
Given that the company plans to evaluate REGULATE-PCI in the coming months, the stock trading below cash is not surprising. Regado ended the first quarter with $72.7 million in cash and burned $5.5 million monthly in the first six months of 2014. The company should have reduced its capital burn in July and August with the suspension of REGULATE-PCI, thus we estimate RGDO’s cash at $67.7 million (~$2.5M monthly – $5M in July and August). With 33.6 million shares outstanding (39.9M on a fully diluted basis) the company should have around $2.00 per share in cash (~$1.70 on a fully diluted basis).
