NEW YORK (TheStreet) -- Advaxis (ADXS) shares have fallen 25% from highs after the company announced a $53 million public offering last week at $19 a share (the company netted $49 million, which it intends to use in the pipeline research and development).
Yet, the Advaxis received a strong vote of confidence from its largest institutional shareholder, hedge fund Adage Capital Partners.
In a released Form 4, filed by insiders or shareholders of more than 10% ownership, Adage disclosed that it purchased an additional 500,000 shares of Advaxis at $19. The hedge fund now owns 5.64 million shares of Advaxis, or about 19% of company's shares outstanding. This makes Adage the largest holder.
Adage has taken part in Advaxis' previous two financings, with the majority of its stake purchased at a $4.25 offering and another 10% at a $7.50 price. In the most recent public offering, Adage averaged its Advaxis position up at a purchase price of $19 per share just to keep 19% ownership.
Adage buying more Advaxis at 150% higher than its previous investment is an endorsement for the company moving forward. Such a move indicates that Adage believes Advaxis' recent run will continue upward. Adage is best known for being the largest shareholder in Puma Biotechnology (PBYI), before the company saw shares jump nearly 300% on its breast cancer drug in July 2014. Advaxis investors are hoping for a similar result.