Cel-Sci Corporation (CVM) saw its stock plunge after pricing a public offering of over 7 million shares of stock. Pricing the units at $1.40 apiece for gross proceeds of $10 million. Each unit includes a share of common stock and a $0.25 warrant, exercisable immediately with an expiration date of October 17, 2014, for purchase of another share of common stock at a price of $1.58 apiece.

The offering represents a significant increase in the 55.94 million share float, and that’s what’s driving down share prices today. Losses ultimately finished the day at 13.24 percent, finishing the day at $1.31 a share after reaching lows of $1.27.

The $10 million raised by the offering is intended to be used to fund its Phase III clinical trial for Multikine, the company’s lead therapy.

Cel-sci is a late-stage oncology company committed to developing treatments that use cytokines to stimulate the immune system to fight cancer. The company’s website describes Multikine (leukocyte interleukin, injection) as follows:

“CEL-SCI's lead investigational therapy Multikine, is the first immunotherapeutic agent being developed as a potential first-line treatment for advanced primary head and neck cancer. If it were to be approved for use following completion of our clinical development program, Multikine would be a different kind of therapy in the fight against cancer: one that is designed with the intent to employ our body's natural ability to fight tumors.”

Small-cap Cel-sci has been in a lengthy struggle to bring its products to the market, engaging in lengthy, expensive clinical trials. However, the company appears to be nearing approval for treatment of head and neck cancers.

The day’s losses appear to be largely in line with the increase in the stock’s float. Any valuation of the company would be difficult as it lacks any meaningful fundamental data. Like most micro-cap biotechs, the future of Cel-sci hinges entirely on the success or failure of its upcoming clinical trial.

The company’s stock chart has also shown a clear triangle pattern forming. The catalyst for the day’s loss was clearly the price of the offering, but the breakout from the pattern is also unsurprising. The stock broke support levels and crossed the 20-day and 50-day SMA from above, despite the 20-day SMA appearing to act as an additional support level since the start of February.