It is the opinion of many biotech executives that the best time to raise money is when you don't need it.

With a nine-digit figure in the bank, it seems as though that is just what Vertex Pharmaceuticals Inc. did late last week. As of the end of the second quarter, the Cambridge, Mass.-based company had $315.9 million in cash, cash equivalents and securities for sale, not to mention it signed a deal that entailed a $165 million up-front payment a week later with Janssen Pharmaceutica NV for the hepatitis C virus protease inhibitor, VX-950.

Yet the company still priced a public offering of 9.1 million shares Thursday evening at $33 apiece, raising gross proceeds of about $300.3 million. The size of the offering is the second highest public financing conducted this year, second only to Amylin Pharmaceuticals Inc., of San Diego, which raised $534.8 million in March.

Vertex's stock (NASDAQ:VRTX) fell 54 cents Friday to close of $32.98.

According to Vertex's prospectus, proceeds from the public offering would go toward general corporate purposes, which could include research and development, clinical trials, manufacture and supply of drug products, acquisitions of new technologies, capital expenditures, investments and working capital.

The company is raising a little more than expected. It had filed with the SEC earlier last week to offer 8 million shares.

Underwriters include Merrill Lynch, Pierce, Fenner & Smith Inc. as the sole bookrunner, Morgan Stanley & Co. Inc. as joint lead manager and UBS Securities LLC as co-manager. All firms are based in New York. They have an option to purchase up to 900,000 shares to cover overallotments. If exercised in full, the option would bring Vertex another $29.7 million in gross proceeds.

Following the offering, the company will have about 119.7 million shares outstanding.

Vertex has been around since 1989 and focuses on small-molecule drugs to treat viral diseases, inflammatory and autoimmune diseases, cancer pain and bacterial infections. It is concentrating its resources on three clinical-stage programs: VX-950 (telaprevir) for chronic hepatitis C infection, which is in Phase IIb; VX-702 for rheumatoid arthritis and other inflammatory diseases, which is in Phase II; and VX-770 for cystic fibrosis, which is in Phase I.

Vertex holds worldwide rights to VX-770, and all rights for VX-702 except for the Far East where Kissei Pharmaceutical Co. Ltd., of Tokyo, is developing the product. The lead drug, VX-950, is partnered with Mitsubishi Pharma Corp., of Osaka, Japan, for the Far East and with Janssen for the rest of the world except North America, where Vertex retained the rights. The deal with Janssen, a unit of new Brunswick, N.J.-based Johnson & Johnson, was signed earlier this summer. In addition to the $165 million up-front money, Vertex could earn up to $380 million in milestone payments and a mid-20 percent tiered royalty on sales. (See BioWorld Today, July 5, 2006.)

VX-950 is designed to inhibit NS3-4A serine protease, an enzyme considered essential for HCV replication. The drug has fast-track status and is in two ongoing Phase IIb trials, called PROVE 1 in the U.S. and PROVE 2 in Europe, which together are enrolling 580 treatment-na ve patients. A PROVE 3 trial is expected to begin the second half of this year and would enroll about 400 patients.

Vertex's lead oral p38 mitogen-activated protein kinase inhibitor, VX-702, is ready to enter a 12-week, 120-patient Phase IIa trial in RA patients in the fourth quarter of this year. The trial will evaluate VX-702 in patients who have received methotrexate. It could be followed by a six-month Phase IIb study in 400 RA patients to begin in the second half of 2007.

The company's third product, VX-770, is an oral small-molecule compound designed to potentiate the gating activity of the cystic fibrosis transmembrane regulator protein. The company has completed the dosing portion of its Phase I trial in healthy volunteers and CF patients, and is evaluating the full safety and pharmacokinetic results. A Phase II proof-of-concept trial is expected to begin in early 2007.

Vertex also is working at the preclinical stage with VX-883 and VX-692 for bacterial infections, VX-398 for oncology, and VX-166 for sepsis/acute liver disease, and is in Phase II with VX-765 for psoriasis.

It has one marketed product, Lexiva/Telzir (fosamprenavir calcium) for HIV infection and AIDS, which is promoted worldwide by London-based GlaxoSmithKline plc. Programs led by collaborators, such as Merck & Co. Inc., of Whitehouse Station, N.J.; GSK; Avalon Pharmaceuticals Inc., of Germantown, Md.; and Novartis AG, of Basel, Switzerland, are for drug candidates in the areas of oncology, pain and transplant.

In other financing news:

• Auxilium Pharmaceuticals Inc., of Malvern, Pa., entered definitive agreements with certain institutional investors to sell 5.5 million shares of its common stock at $8.50 per share, resulting in net proceeds of about $43.3 million. The company expects to use the net proceeds for general corporate purposes, including working capital, product development and capital expenditures. Thomas Weisel Partners LLC served as lead placement agent, and Roth Capital Partners LLC acted as co-placement agent for the transaction. Auxilium markets Testim 1 percent, a topical testosterone gel, to treat hypogonadism, and it has five projects in clinical development. The company's stock (NASDAQ:AUXL) climbed 93 cents Friday, or 10 percent, to close at $10.23.

• Barrier Therapeutics Inc., of Princeton, N.J., priced a direct offering of common stock for about $25 million gross proceeds. The company is selling about 4.8 million shares at $5.25 apiece to a select group of institutional investors. Pacific Growth Equities LLC acted as the sole underwriter. Barrier is focused on the discovery, development and commercialization of pharmaceutical products in the field of dermatology.

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