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Shares of Oncothyreon (NASDAQ:ONTY) sprinted back up to the six dollar mark following news on Tuesday that the company had initiated the Phase II portion of the ongoing Phase I/II PX-866 trial.

The trial for Oncothyreon's anti-cancer agent was initiated late last year, and the initiation of a Phase II portion indicates a successful Phase I, as mentioned in Tuesday's press release.

PX-866 provides the company with a potential lucrative future, but the shorter term market-moving events revolve around Stimuvax, for which Phase III non-small cell lung cancer trials are winding down.

Results will start being finalized later this year, with a full release expected for early 2012.

Stimuvax is partnered with Germany's Merck KGaA and, if successful in Phase III and ultimately approved by the US FDA and/or European medical authorities, could provide this little company with its own Dendreon (NASDAQ:DNDN) story.

Oncothyreon recently conducted a stock offering, so the financial position of the company is pretty solid for the time being, and additional price appreciation is also possible leading into the release of the Phase III Stimuvax results.

That said, the rise from the three dollar level has been pretty rapid, so while the possibility for additional gains exist, I also wouldn't be surprised to see the volatility increase as more attention is brought to the stock.

Volatility will both offer the opportunity to flip some of those three dollar shares and accumulate on the dips with an eye towards trial results.

This company could become a big player in the cancer immunotherapy market in time, and the historic run of Dendreon makes all late-stage cancer vaccines attractive speculative buys.

D-day is getting closer for Oncothyreon, so keep it on the watch list.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: Oncothyreon: Could Be a Big Player in Cancer Treatment