Durect (DRRX) has had a rocky past six months. The immediate concern of biotech investors when they see a $2 stock is the cash position. Any stock trading at $2 must have significant cash burn concerns, right?Well, like Lee Corso says, "Not so fast my friend!" Durect exited the first quarter with $47.0 million in cash on hand and virtually no debt. Burn for the first quarter was only $5.7 million, and we expect that to decline in the coming quarters based on the March 2009 headcount reductions. Plus, we see several potential non-dilutive cash-raising opportunities in 2009 and 2010.Firstly, once Remoxy is finally approved, management will begin receiving payments from King Pharmaceuticals (KG). This will help reduce burn. However, management can sell the rights to these royalties for upfront cash if they choose.Second, management is going to re-partner the TRANSDUR-Sufentanil ...

We highlight Durect Corp. (DRRX), Endo Pharmaceuticals (ENDP) and King Pharmaceuticals, Inc. (KG).Durect Corp. (DRRX) has had a rocky past few months. The stock was hit harder than we expected in December 2008 when the FDA rejected the application on Remoxy. From our standpoint, the rejection of the NDA was not a surprise, but the reaction on Durect stock was.Nevertheless, we think the FDA's issues, most likely around the labeling, the abuse ability, and the risk management program, should only delay final approval by a year. We think that Remoxy will be on the market and generating royalties for Durect by the middle of 2010.The second big sell-off in the stock came in early March 2009 when Durect announced that Transdur development partner, Endo Pharmaceuticals (ENDP), was returning U.S. and Canadian rights to the product to Durect. The news ...

Highlighted stocks include Durect Corp. (DRRX), Endo Pharmaceuticals (ENDP) and King Pharmaceuticals (KG).Durect Corp. (DRRX) has had a rocky past few months. The stock was hit harder than we expected in December 2008 when the FDA rejected the application on Remoxy. From our standpoint, the rejection of the NDA was not a surprise, but the reaction for Durect stock was.Nevertheless, we think the FDA's issues -- most likely around the labeling, the abuse ability and the risk management program -- should only delay final approval by a year. We think that Remoxy will be on the market and generating royalties for Durect by the middle of 2010.The 2nd big sell-off in the stock came in early March 2009 when Durect announced that Transdur development partner, Endo Pharmaceuticals (ENDP), was returning U.S. and Canadian rights to the product to ...