Nearly four months after pulling in an $18 million public offering, Novavax Inc. is adding another $20 million to its coffers in a direct offering of 4.6 million shares to two institutional investors.
Kleiner Perkins Caufield & Byers, of Menlo Park, Calif., agreed to purchase 62.5 percent of the offering (about 2.87 million shares) totaling $12.5 million, and Palo Alto, Calif.-based Prospect Venture Partners is acquiring the remaining 37.5 percent (about 1.72 million shares) totaling $7.5 million. Shares were priced at $4.35 each.
In addition to its participation in this financing, Prospect Venture Partners previously accumulated a $5.5 million equity ownership in Novavax.
Proceeds are expected to fund clinical development of the companys Virus-Like Particle (VLP) avian and seasonal flu vaccines, including the creation of adjuvants and large-scale production capabilities for these vaccines. Money also could go toward Novavaxs internal research and development programs and for other general corporate purposes.
Representatives of the Malvern, Pa.-based company could not be reached for comment. Shares of Novavax (NASDAQ:NVAX) gained 60 cents Monday, to close at $5.72.
Though the company has struggled with some of its development and commercialization efforts in the past, things have turned around since it began focusing on pandemic flu vaccines. In August, Novavaxs stock jumped 30 percent, closing at $1.22, on preclinical data demonstrating that its VLP-based vaccine targeting the H9N2 avian flu strain effectively protected animals that were challenged with a live virus. The company also is investigating a vaccine against the H5N1 strain of bird flu. (See BioWorld Today, Aug. 26, 2005.)
Earlier this month, Novavax agreed to collaborate with researchers at the University of Pittsburgh School of Medicine to test the levels of immunity obtained with the use of the VLP-based flu vaccines. Research also will evaluate the ability of Novasomes, adjuvant carriers designed to improve vaccine efficacy, to broaden the overall protective immune response elicited by the vaccines. Data from that collaboration is intended to supplement results from earlier studies.
In addition to its flu vaccines, Novavax also is working on vaccines for the prevention and treatment of HIV/AIDS, severe acute respiratory syndrome and melanoma. A recombinant HEV ORF2 subunit protein vaccine, partnered with London-based GlaxoSmithKline plc, is in Phase III trials in patients with hepatitis E. That product is being developed in collaboration with the National Institutes of Allergy and Infectious Diseases and the Walter Reed Army Institute for Research.
Novavax is expected to release its fourth-quarter and full-year earnings Wednesday. For the third quarter of 2005, it reported a net loss of $2.7 million, or 6 cents per share. As of Sept. 30, Novavaxs cash and cash equivalents totaled $6.9 million, though the companys public offering brought in $18 million in November. In that offering, Novavax sold 4.2 million shares at $4.30 each. (See BioWorld Today, Nov. 3, 2005.)
In other financing news:
Avalon Pharmaceuticals Inc., of Germantown, Md., raised $7.25 million in a private placement with Biotechnology Value Fund LP and other institutional investors. The company issued 1.67 million shares of common stock priced at $4.35 per share. Proceeds are expected to be used for expanding internal oncology drug discovery programs using the AvalonRx technology, as well as to support ongoing clinical development of AVN944, a monophosphate dehydrogenase inhibitor aimed at treating cancer. W.R. Hambrecht, of New York, served as financial advisor for the transaction. Shares of Avalon (NASDAQ:AVRX) closed at $4.99 Monday, up 2 cents.
Corautus Genetics Inc., of Atlanta, filed a preliminary prospectus supplement relating to an offering of 6.5 million shares of its common stock pursuant to a shelf registration statement filed last month. Corautus also agreed to grant underwriters in the offering an option to purchase up to 975,000 additional shares to cover any overallotments. Shares have not yet been priced. Lazard Capital Markets LLC, of New York, will act as the lead manager and sole bookrunner for the offering, with Jefferies & Co. Inc., also of New York, to act as co-lead manager. Shares of Corautus (NASDAQ:VEGF) closed Monday at $5, down 26 cents.
VASTox plc, of Oxford, UK, raised £10.45 million (US$18.2 million) in a placement of 5.9 million shares priced at 177 pence to institutional investors. The company said funds will be used to accelerate the development of its lead therapeutic program in Duchennes muscular dystrophy. Evolution Securities Ltd., of London, served as underwriter for the offering.