A Reality Check on Tuesday’s Hot Biotech Stocks: AVI BioPharma (AVII), Poniard Pharmaceuticals (PARDD) and Cardium Therapeutics (CXM)

On Tuesday, biotech stocks AVI BioPharma (NASDAQ: AVII), Poniard Pharmaceuticals (NASDAQ: PARDD) and Cardium Therapeutics (AMEX: CXM) were rewarding investors with sizable gains. Specifically, AVI BioPharma (AVII) rose 23.33%, Poniard Pharmaceuticals (PARDD) rose 10.49% and Cardium Therapeutics (CXM) rose 9.35%. However, hot biotech stocks have a way of going cold rather quickly for investors – especially after a strikeout with the FDA or with a clinical trial. Hence, do biotech stocks AVI BioPharma (AVII), Poniard Pharmaceuticals (PARDD) and Cardium Therapeutics (CXM) have anything to offer biotech investors? Here is a closer look at all three to help you decide:

AVI BioPharma (NASDAQ: AVII)

AVI BioPharma is a biopharmaceutical company focused on the discovery and development of ribonucleic acid (RNA)-based therapeutics for the treatment of both rare and infectious diseases. On Wednesday, AVI BioPharma rose 23.33% to $0.74 (AVII has a 52 week trading range of $0.50 to $2.74 a share) for a market cap of $100 million. The rise might be attributed to a blogger noting that on Friday, CEO Christopher Garabedian reported that he purchased 300,000 shares for $0.17 million to end the week with 430,000 shares. However, investors might want to also take note that a week ago, AVI BioPharma had received a delisting notice because its stock was consistently trading below the $1 level (its also down 655 for the year). In addition, AVI BioPharma has reported declining revenues of $7,524k (most recent quarter), $11,585k, $14,296k and $15,517k for the past four quarters; a net loss of $4,020k (most recent quarter), net income of $1,279k and $1,833k and a net loss of $7,644k; and $46,356k in cash to cover $26,531k in current liabilities. Hence, investors need to wonder what AVI BioPharma’s CEO has to be optimistic about besides a strong cash position.

Poniard Pharmaceuticals (NASDAQ: PARDD)

Poniard Pharmaceuticals is a biopharmaceutical company focused on the development and commercialization of innovative oncology products. On Wednesday, Poniard Pharmaceuticals rose 10.49% to $2.95 (PARDD has a 52 week trading range of $2.54 to $30.00 a share) for a market cap of $4.42 million on no apparent news but the stock is down 50% over the past month. In November, Poniard Pharmaceuticals’ shareholders approved a merger with ALLOZYNE, Inc. (which is focused on protein therapeutic product candidates to treat autoimmune and inflammatory diseases and cancer) that involved the issuance of shares of Poniard common stock and a 1-for-40 reverse stock split of Poniard common stock. Hence, it’s a bit difficult to evaluate Poniard Pharmaceuticals’ financial position at this time – meaning investors might want to stay away for now.

Cardium Therapeutics (AMEX: CXM)

Cardium Therapeutics seeks to acquire new and innovative bio-medical product opportunities and businesses while its current medical opportunities portfolio is focused on health sciences and regenerative medicine. Existing products include the Tissue Repair Company, Cardium Biologics and the an in-house MedPodium Health Sciences healthy lifestyle product platform. On Wednesday, Cardium Therapeutics rose 9.35% to $0.310 (CXM has a 52 week trading range of $0.13 to $0.60 a share) for a market cap of $28.80 million. Apparently, the rise was triggered by the announcement that Cardium Therapeutics had entered into a cross-strategic investment agreement with SourceOne Global Partners for the joint development and commercialization of customized nutritional supplements plus pharmaceuticals and medical foods based on the latter's branded ingredients (it should be noted that Cardium Therapeutics did make the a $0.75 million equity investment in the form of unregistered, restricted Cardium shares). Investors should also note that Cardium Therapeutics has received 510(k) clearance from the FDA to market and sell its Excellagen™ (a syringe-based wound care product for the management of diabetic foot ulcers, pressure ulcers and related wounds) and is preparing for its commercial launch in the first quarter 2012. However, investors should also be aware that Cardium Therapeutics has reported revenues of zero (most recent quarter), zero, zero and $244k for the past four quarters; net looses of $1,600k (most recent quarter), $1,763k and $1,689k along with net income of $443k; and $2,358k in cash to cover $1,311k in current liabilities. Hence, investors should be asking how Cardium Therapeutics intends to fund the launch of Excellagen™ and other activities in a way that won’t dilute them.

The Bottom Line. Maybe traders will find something to like about biotech stocks AVI BioPharma (AVII), Poniard Pharmaceuticals (PARDD) and Cardium Therapeutics (CXM) but most investors will probably want to give all three a past for now.