Investors Make Money In Oncomed Pharmaceuticals Inc (NASDAQ:OMED)
Oncomed Pharmaceuticals Inc (NASDAQ:OMED) stock almost doubled in its market value in one single day of trading yesterday. The stock value of this $770 million market capped drug maker sky rocketed by a head spin inducing 97% during trading yesterday. It ended the day’s trading at $27.7 per share, almost doubling its previous day close price of $14 per share. This surge in the market value has helped the development stage drug maker post a 115% increase in its market value in the past one week of trading.
This stock market rally in Oncomed Pharmaceuticals Inc (NASDAQ:OMED) was initiated by Monday’s announcement that it had entered into a collaboration and joint development agreement with drug major Celgene Corporation (NASDAQ:CELG). As per the agreement, the two companies have agreed to merge their research and development efforts in developing target drugs “anti-CSC biologic therapeutics”. The agreement also offers the bigger and deep pocketed $65 billion market capped Celgene Corporation (NASDAQ:CELG) and option to extend the collaboration to cover the “discovery, development and commercialization” phases of the development cycle of the “anti-CSC small molecule therapeutics”.
Oncomed Pharmaceuticals Inc (NASDAQ:OMED) will get paid an upfront cash dole of $155 million and in addition will be eligible for $1.8 billion as payments towards meeting development milestones which are spread across three different lines of target drug development. In addition the small cap drug maker will be able to expect long term royalty in the event of any of these development stage drugs getting sold commercially.
Oncomed Pharmaceuticals Inc (NASDAQ:OMED) stock is trading at 10% below its prior 52 week high price points and has managed to post a 2% increase in the past 12 months. The drug maker has accumulated net loss of $26 million. At current price points it seems like a matter of time before the stock hits his price point of $29 per share.