When investing in a biotech company that has an ATM in place, assume constant dilution, even if its dribs and drabs. Whether that bothers you or not is your call. Just make sure you read the company's 10-Q every quarter. Let's all agree on this: ATMs are better than PIPEs and death-spiral converts. Rexahn has been in my crosshairs before, mainly for the misleading pronouncements around its depression drug Serdaxin (now blown up and long forgotten.) Let's dissect this week's press release announcing results from a phase II study of the company's experimental drug Archexin in pancreatic cancer. Rexahn: "The open label 2-stage study was designed to assess the safety and efficacy of Archexin in combination with gemcitabine. Stage 1 was the dose finding portion and stage 2 was the dose expansion portion using the dose identified in stage 1 to be administered with gemcitabine. The study enrolled 31 subjects aged 18-65 years with metastatic pancreatic cancer at four centers in the United States and five centers in India. The primary endpoint was overall survival following 4 cycles of therapy with a 6-month follow-up." By open label, Rexahn means all patients in the study were treated with Archexin and gemcitabine. The study has no control arm i.e. patients treated with gemcitabine plus a placebo. Single-arm studies, by definition, cannot be used to determine a survival benefit because there is no comparator treatment by which an experimental drug can be measured against. A 31-patient phase II study is on the small side, and any study enrolling patients in India raises an immediate red flag about data quality. Rexahn: For those evaluable patients according to the protocol, the study demonstrated that treatment with Archexin in combination with gemcitabine provided a median survival of 9.1 months compared to the historical survival data of 5.65 months (Burris et al., 1997, J. Clin Oncol 15:2403) for standard single agent gemcitabine therapy. The most frequently reported adverse events were constipation, nausea, abdominal pain, and pyrexia, regardless of relatedness. Uh oh. "Evaluable patients?" Right off the bat, Rexahn is telling us they've excluded some pancreatic cancer patients from the efficacy analysis. How many patients were thrown out and why is apparently a closely guarded secret because Rexahn doesn't bother to tell us. Then we get the inevitable survival "benefit" of Archexin (median 9.1 months) compared to a historical control of single agent gemcitabine (median 5.6 months.) In this case, the historical control is a study published 15 years ago. Rexahn couldn't come up with something more recent? The analysts at BioMedTracker.com raise a very astute red flag: In order to be eligible to enroll in the Archexin study, pancreatic cancer patients had to have a life expectancy of at least six months, assessed by their doctor. You can read the study's enrollment criteria here. So, even before the Archexin study began, the enrolled patients were going to live longer than the patients in the 15-year-old study of gemcitabine used as a historical control.