Arno Therapeutics, Inc. (OTCMKTS:ARNI) Hits 52-Week Low

After a month of very slow trading and nearly ten days with zero share volume, on Wednesday Arno Therapeutics, Inc. (OTCMKTS:ARNI) suddenly shifted 450 thousand shares. As a result, the company’s share price dropped over 23% to a close of $0.88 at the bell.

The company is a biopharma with three main products focusing on breast cancer and solid tumors. Press releases are coming out on a frequent basis, informing of goings on with the product pipeline. On October 27 ARNI informed that its flagship product – onapristone – into the expansion stage of Phase I trials. Additionally, the Phase II dosage of the drug has been determined too. This news was met with next to no enthusiasm as ARNI traded less than 1000 shares on the same day and was completely flat at zero trades on the next.

The company next informed that it will present at the 5th annual conference for clinical affairs and regulatory approvals. This seemed to elicit a much more enthusiastic market response, as ARNI traded more shares yesterday than it had over the past two months combined. Shortly after noon the price took a dramatic nose dive on very low share volumes. An attempt at recovery fizzled despite a spike in volume and the stock tumbled to its close, 23% in the red. Here is what the company had to show as of its latest 10-Q:

• $15.8 million in cash
• $23 million in total liabilities
• zero revenues
• $3.4 million in quarterly net income

The discrepancy between revenues and net income comes from the $9.2 million ARNI recorded as “other income”, due to ‘decreases and increases’ of the company’s stock price, which led to non-cash adjustments to warrant liability during the quarter.

In its latest filing ARNI informed that the company has Series B warrants for the purchase of 6.2 million common shares, as well as Series E warrants for another 12.8 million common shares. Both series of warrants are exercisable at $2.40 per share and the company extended their expiration date from Oct 31 to the end of calendar 2014.

Even though ARNI has been slipping throughout 2014, from $2.90 per share in January to its 52-week low at $0.88, yesterday’s dip took place on such low volume that it seems even small shifts can significantly rock the boat, making ARNI particularly volatile.