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What: Shares of Anthera Pharmaceuticals (NASDAQ:ANTH), a clinical-stage biopharmaceutical company focused on treating patients in a wide array of unmet indications, tumbled as much as 10% during Thursday's trading session after announcing a public stock offering following the closing bell on Wednesday, and pricing its offering Thursday morning.

So what: According to last night's press release, the company intended to issue common stock in order to fund its clinical research and development, and for general corporate purposes. This is fairly common of clinical-stage biotech companies before they have a source of recurring revenue.

Earlier this morning, Anthera announced the pricing of 3,333,334 shares of common stock at $7.50 per shares. This sale, which is expected to close "on or about July 14, 2015," is estimated to produce gross proceeds of $25 million before deducting for underwriting and other expenses. The $7.50 price point is a 10% discount compared to where Anthera's stock close on Wednesday.

Now what: Common stock offerings are something of a necessary evil for many clinical-stage biotech companies. If they weren't able to raise cash, they wouldn't be able to conduct their research and run clinical studies. However, common stock offerings also dilute the existing value of each share currently held by Anthera's shareholders -- and Anthera investors are no strangers to common stock offerings. During the first quarter, Anthera received $26.9 million from a public offering.

The good news here is that Anthera's first-half ending cash and cash equivalents balance should be above $55 million even after factoring in its second-quarter cash outflow. Based on its trailing 12-month operating cash outflow of $27 million, the implication is that Anthera might have enough of a cash runway to now last two years. That should be more than enough time for the company to deliver its much-anticipated late-stage results from its CHABLIS-SC1 study involving blisibimod for patients with systemic lupus erythematosus. Data is due out sometime in the second-half of 2016.

As with most clinical-stage biotech stocks, I'd suggest parking yourself on the sidelines and waiting for the CHALBIS-SC1 results before wading into the water. It's safer and will give you an opportunity to benefit from partnership opportunities and sales of blisibimod later on.

Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.

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