Biorelease Corp. announced Tuesday that it is placing 2.8 millionshares of its common stock with offshore investors. The Regulation Splacement will bring the company $2.1 million in net proceeds.

The Salem, N.H., company will receive the money over the next 60days, Biorelease's president and chief executive officer, R. BruceReeves, told BioWorld. The placement will leave Biorelease withapproximately 8.8 million shares outstanding.

Biorelease currently has about $728,000 cash on hand, according toReeves. At its current burn rate of approximately $600,000 perquarter, the much-needed financing should meet the company's cashneeds for most of the year.

The company currently markets Erythrogen, a modified form ofbovine hemoglobin used to oxygenate high-density cell cultures andthereby accelerate their growth. Erythrogen is now sold toresearchers (the company does not need regulatory approval to dothis). Biorelease intends to pursue approval of Erythrogen for sale tobiotechnology and pharmaceutical companies.

Biorelease is also developing a bovine-derived, hemoglobin-basedblood substitute and a chondroitin sulfate-based sustained-releasedrug delivery system. Biorelease currently trades on the NASDAQsmall-cap index as BRELC.

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