BioWorld International Correspondent

Algeta ASA's IPO on the Oslo Stock Exchange hit the upper end of its target, raising gross proceeds of slightly less than NOK250 million (US$41.1 million).

The Oslo, Norway-based firm priced the offer at NOK47 per share Friday, compared to its indicative price range of NOK41 to NOK51 per share during the bookbuilding period. It issued 5,319,148 new shares, and has set aside another 797,852 shares to cover overallotments. The company had originally planned to issue between 3.92 million and 6.1 million shares, and had set its overall fundraising target within a range of NOK200 million to NOK250 million.

The shares peaked at NOK48 during the opening trading session, but dipped to NOK44.50 during the afternoon. With almost 16.5 million shares outstanding, that values the company at about NOK734 million, excluding the overallotment option.

The offer was almost two-times oversubscribed, with substantial interest from overseas institutional investors. "The participation was about 70 percent from international investors," Algeta CEO Thomas Ramdahl told BioWorld International. "They really see potential in the stock and in what we are doing." Domestic institutions took up about 20 percent of the available stock, while retail investors scooped another 10 percent.

Interest in the IPO was sparked by the company's recent disclosure of Phase II clinical trial data for its lead product, an alpha-particle-emitting formulation of radium-223 called Alpharadin. That study, a placebo-controlled trial of 64 patients with skeletal metastases arising from hormone refractory prostate cancer, indicated a survival benefit, as well as a delay in disease progression. "I think that really made the difference," Ramdahl said. (See BioWorld International, Feb. 28, 2007.).

Two other Phase II clinical trials of Alpharadin are under way - a pain palliation trial involving 100 patients and a second anti-tumor trial involving 117 patients. Data from each of these studies is expected in 2008. Algeta also plans to commence a Phase III registration study for Alpharadin in 2008. "Most of the funds will go in that direction, of course," Ramdahl said. Data from that study is expected in 2010.

The company also will progress its preclinical programs, which still are about two years from entering the clinic. They include TH-1, which comprises thorium-227 conjugated to a targeting antibody, and which has potential in several indications. OC-3, initially in development for ovarian cancer, consists of lead-212 encapsulated within a biodegradable material. RV-1, which is in development for soft tissue tumors, is based on Ra-223 encapsulated within a liposome carrier.

Algeta has so far retained all commercial rights to its project portfolio, but the company aims to make TH-1 available for early licensing. It already has entered one agreement, with Affibody AB, of Stockholm, Sweden, whose so-called Affibody protein recognition molecules are based on non-antibody scaffolds. That collaboration centers on the HER2 receptor, which is over expressed in certain breast cancers.

ABG Sundal Collier ASA and DnB NOR Markets, both of Oslo, acted as joint lead managers on the IPO, while Terra Securities, also of Norway, was co-lead manager.

Algeta was founded in 1997 as Anticancer Therapeutic Inventions by Roy Larsen and Oyvind Bruland, both of the University of Oslo. The company held cash and equivalents totalling NOK109.6 million at the end of 2006 and posted a net loss for the year of NOK47 million. In other financing news:

• Karo Bio AB, of Huddinge, Sweden, said it had obtained advance commitments from shareholders covering 95.8 percent of a planned rights issue that would generate SEK406 million (US$58.2 million). Karo Bio plans to issue up to approximately 38.7 million shares at SEK10.50 per share.

Current shareholders would be entitled to subscribe for one new share for every two shares currently held. The subscription period runs from April 24 through May 8. The company's stock was down by 12 percent to SEK15.80 during afternoon trading Tuesday, having closed Monday at SEK18.