Coherex Medical (Salt Lake City) reported that it has closed a $16.5 million Series B preferred stock financing. After the close of this investment, Coherex has now raised nearly $28 million in equity financing from outside funding sources since inception.
Spring Capital (Baltimore, Maryland) and Oxford Bioscience Partners (Boston) were co-lead investors on this financing, and both venture capital firms participated in Coherex' prior Series A preferred stock financing. Also joining Spring and Oxford in Coherex' Series B financing were Tullis Health Investors (Stamford, Connecticut) a venture capital firm focused on the healthcare industry, and a strategic investor.
The company said in June that the Coherex FlatStent EF was the first "in-tunnel" device to receive CE mark clearance for closing patent foramen ovale (PFO), a heart defect found in approximately 20% of the worldwide population (Medical Device Daily July, 9, 2009).
"The funding will be used to help us launch the [Coherex FlatStent EF] in the U.S.," Trent Loveless, Coherex CFO told Medical Device Daily. "It's also going to aid in our launch of a clinical trial for the product which will be sometime in 2010."
He added that the company was pleased to be able to raise this level of funding in a difficult time and that it had very strong support from its investors.
In other financing activity:
• Cerus (Concord, California) reported that it has entered into definitive agreements with selected investors to sell 6 million units, with each unit consisting of (i) one share of the company's common stock and (ii) a warrant to purchase 0.4 of a share of the company's common stock for gross proceeds of approximately $13.2 million in a "registered direct" offering.
The company estimates that net proceeds from the offering will be nearly $12.2 million, after deducting placement agent fees and estimated offering expenses. The investors have agreed to purchase the units at a purchase price of $2.20 per unit.
The warrants, which represent the right to acquire an aggregate of up to 2.4 million shares of the company's common stock, will have a five-year term from the date of issuance, will be exercisable beginning six months after the date of issuance and will be exercisable at a price of $2.90 per share. The transaction is expected to close on or about August 25, subject to the satisfaction of customary closing conditions. The net proceeds from the transaction are expected to be used for working capital and general corporate purposes.
Cowen and Co., a subsidiary of Cowen Group (New York), acted as the exclusive placement agent for the transaction.
• Cell Therapeutics (Seattle) reported that it has entered into an agreement to sell $30 million of shares of its Series 2 preferred stock and warrants to purchase shares of its common stock in a registered offering to a single institutional investor. Each share of Series 2 preferred stock is convertible at the option of the holder, at any time during its existence, into approximately 628 shares of common stock at a conversion price of $1.59125 per share of common stock for a total of approximately 18,853,103 common shares.
In connection with the offering, the investor received warrants to purchase up to 4,713,276 shares of common stock. The warrants have an exercise price of $1.70 per warrant share, for total potential additional proceeds to the company of nearly $8 million upon exercise of the warrants.
The company intends to use the net proceeds from the offering for working capital and general corporate purposes, which may include, among other things, paying interest on and/or retiring portions of its outstanding debt, funding research and development, preclinical and clinical trials, the preparation and filing of new drug applications, and general working capital.
Shares of the Series 2 preferred stock will receive dividends in the same amount as any dividends declared and paid on shares of common stock and have no voting rights on general corporate matters.
The closing of the offering is expected to occur on Aug. 24, at which time the company will receive the cash proceeds and deliver the securities.
Rodman & Renshaw, a wholly-owned subsidiary of Rodman & Renshaw Capital Group, (New York) acted as the exclusive placement agent for the offering.
Omar Ford, 404-262-5546; email@example.com