West Coast Editor

NovaDel Pharma Inc. completed the sale of about 8 million shares in a previously disclosed private equity offering, raising about $11.8 million in gross proceeds for its work with oral-spray drug formulations.

The company's stock (AMEX:NVD) closed Friday at $1.78, up 13 cents.

Under the terms, Flemington, N.J.-based NovaDel issued and sold about 8.1 million shares of common stock and warrants to purchase about 2.4 million shares of common stock. Non-affiliated investors bought shares at the offering price of $1.45 per share, while others paid $1.58 per share, which was the last closing sale price on April 10, the day immediately prior to execution of the placement.

All participants in the offering got a third of a warrant per share of stock expiring Oct. 19, 2011, with an exercise price equal to $1.60 per share.

Company executives could not be reached, but a spokesman said the proceeds will go toward all of the firm's oral spray products.

In its most recent quarterly filing, NovaDel said proceeds during the next fiscal year will go toward several candidates, including nitroglycerin in a lingual aerosol form called NitroMist, for which the company got an approvable letter last summer from the FDA. The company said approval could come at the end of the second quarter.

Another candidate is zolpidem oral spray. NovaDel's spray version of zolpidem tartrate has been shown to achieve similar blood levels faster than the currently marketed 10-mg oral sleep drug, Ambien, from Paris-based Sanofi-Aventis Group. NovaDel had a pre-investigational new drug application meeting with the FDA on Aug. 31 and expects to file the IND during the third quarter, with a new drug application targeted for the first quarter of 2007.

The company also has sumatriptan, which is the active ingredient in London-based GlaxoSmithKline plc's migraine drug, Imitrex, and which was the subject of a pre-IND meeting last summer. Having filed the IND in December, NovaDel plans to submit an NDA in the third quarter of 2007.

NovaDel also has a partnership with Hana Biosciences Inc., of South San Francisco, for ondansetron. Hana filed the IND in November and plans to submit the NDA for the oral spray version, branded Zensana, in May. NovaDel retains the rights outside the U.S. and Canada.

Ondansetron hydrochloride is the active ingredient of the compound sold under the brand name Zofran by GSK, for chemotherapy-inducted nausea and vomiting.

Also in the works is propofol, partnered with Manhattan Pharmaceuticals Inc., of New York, which has filed an IND with the FDA. Manhattan will oversee all clinical development and regulatory approval for the product for pre-procedural sedation.

As of Jan. 31, NovaDel had about $2.4 million in cash and $497,000 in short-term investments.