Discovery Laboratories Inc. is raising $30.2 million through a registered direct offering of 14.05 million shares.
The Warrington, Pa.-based company said institutional investors are purchasing the stock at $2.15 per share, a discount of about 6.5 percent to closing prices over the previous eight trading days, but a higher price than the stock traded at in weeks prior to that. The shares (NASDAQ:DSCO) dipped 3 cents Tuesday to close at $2.29.
In January, Discovery Labs received guidance from the FDA regarding the remaining steps necessary for potential approval of its lead product, Surfaxin (lucinactant), for the prevention of respiratory distress syndrome in premature infants. An approvable letter from the FDA in April 2006 focused primarily on the chemistry, manufacturing and controls section of the Surfaxin new drug application, the company said, and requested additional information focused mainly on drug product specifications and related controls.
Discovery Labs said the approvable letter called for no additional trials, and it anticipated filing its formal response to the FDA in September or October. (See BioWorld Today, April 26, 2006.) Jefferies & Co. Inc. is lead placement agent for the sale of the registered shares. Lazard Capital Markets LLC is co-placement agent.
In other financing news:
• ChemGenex Pharmaceuticals Ltd., of Melbourne, Australia, raised A$10.5 million (US$8.53 million) through a rights issue, a deal that followed a separate A$10.5M private placement in February. The rights issue included 16.9 million shares and associated options. Participation in the rights issue raised Alta Partners' shareholding in ChemGenex to 19.9 percent and raised GBS Venture Partners' shareholding to 8.9 percent of the 185.8 million outstanding shares. Funds are earmarked for completion of the development program for its lead agent, Ceflatonin, which is in Phase II/III trials for chronic myeloid leukemia patients with the T315I mutation who have failed Gleevec treatment. Separately, ChemGenex said it began a new Phase II/III trial (CML-203) to evaluate Ceflatonin (homoharringtonine or HHT) in CML patients who have failed or were intolerant to treatment with two or more prior tyrosine kinase inhibitors. ChemGenex shares (NASDAQ:CXSP), which also trade in Australia, gained 30 cents Tuesday, to close at $10.60.
• MicroCHIPS Inc., of Bedford, Mass., raised $13.4 million in an investment led by Novartis Venture Fund. CSK Venture Capital joined existing MicroCHIPS investors Polaris Venture Partners, IDG Ventures, Medtronic, Boston Scientific, Intersouth Partners and Boston University Community Technology Fund in the financing round. The company is developing implantable biosensing and drug delivery devices designed to improve therapeutic control, reduce painful interventions and provide other benefits for patients with metabolic and cardiovascular diseases.
• Chromos Molecular Systems Inc., of Burnaby, British Columbia, said a recently announced financing and a potential partnership for its lead product, CHR-1103, both fell through. It said underwriters withdrew their offer on a planned C$4 million (US$3.5 million) bought-deal financing, which was announced March 21 and expected to close this week. The decision in part stemmed from the cessation of collaboration discussions between Chromos and a U.S.-based biotechnology company to co-develop Chromos' CHR-1103, a humanized monoclonal antibody for acute relapses associated with multiple sclerosis. Those nonbinding negotiations were disclosed last month. Chromos said management is reviewing strategic alternatives available to the company.