Washington Editor

Indevus Pharmaceuticals Inc. is raising about $32.6 million by way of a public offering that priced on Wednesday.

The biopharmaceutical company, of Lexington, Mass., sold 7 million shares at $4.65 apiece in the transaction. Net proceeds are expected to be $32.8 million. The per-share price reflected an 8 percent discount to the prior day's $5.08 closing bid on the stock. On Wednesday, the shares (NASDAQ:IDEV) gained 5 cents to close at $5.13.

"We have a lot of activity in the company," Brooke Wagner, Indevus' vice president of corporate communications, told BioWorld Today. With several late-stage products in multiple clinical trials, he said, "it's not a surprise that we were going to need some money" to supplement existing funds.

The company, which had $68.4 million in reserve cash on March 31, had about 47.3 million shares outstanding before the placement. Wagner said its burn rate averages between $10 million and $15 million per quarter, and the new funds are earmarked for working capital and general corporate purposes.

Indevus, which has two marketed products in its portfolio, Sanctura for overactive bladder and Delatestryl for male hypogonadism, offered all the stock pursuant to an effective shelf registration statement covering 10 million shares that was filed at the end of last year.

Its development pipeline is led by Sanctura XR, the once-daily formulation of Sanctura. The compounds are muscarinic receptor antagonists. Just weeks ago, Indevus released positive data from the first of two Phase III trials of Sanctura XR. The findings showed that the product met its primary endpoints by reducing the frequency of urination (p<0.0001) and lowering the number of urge incontinent episodes (p<0.0001) compared to placebo after 12 weeks.

Data from the second Phase III study are due in the coming weeks, and Wagner said the company plans to file Sanctura XR's new drug application by the end of this year. The original formulation, which was approved two years ago, is dosed twice a day and averages 30,000 to 35,000 prescriptions per month, translating to annual sales of about $30 million to $35 million.

Other compounds in clinical development include Nebido for male hypogonadism, PRO 2000 for the prevention of infection by HIV and other sexually transmitted pathogens, IP 751 for interstitial cystitis, pagoclone for premature ejaculation and stuttering, and aminocandin for systemic fungal infections.

Indevus granted the underwriters a 30-day overallotment option to purchase an additional 1.05 million shares. UBS Investment Bank, of New York, acted as the sole book-running manager, and co-managers included CIBC World Markets Corp., of New York; JMP Securities LLC, of New York; and Leerink Swann & Co., of Boston.

The offering is expected to close July 3.

Genelabs Raising $9M Privately

A sale of stock and warrants is grossing $9 million for Genelabs Technologies Inc., a firm focused on hepatitis C.

The company, of Redwood City, Calif., is selling about 6.1 million common shares and warrants to purchase another 2.5 million shares to institutional and accredited investors. The stock is being sold at $1.42 per share, and the warrants are being issued for a purchase price of $0.125 per share underlying the warrants. Their exercise price is $1.42 per share.

The private placement is expected to close Friday.

On Wednesday, Genelabs' stock (NASDAQ:GNLB) slid 12 cents to close at $1.39.

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