West Coast Editor

Taking aim at a Phase II trial with its lead H1 receptor modulator for insomnia, Hypnion Inc. raised $20.1 million in an extension of its Series B financing, thanks to progress made so far.

The compound, HY10275, "sailed very smoothly" through a Phase I trial, said Michael Fitzgerald, chief financial officer of Lexington, Mass.-based Hypnion. A second Phase I trial is wrapping up, and the drug will move into Phase II in January. "We expect to begin seeing data in the third quarter of next year," Fitzgerald said.

In the spring of 2003, the company's Series B pulled down $47.5 million for work using its drug discovery system, previously known as Score-2000 and now called Score-2004. (See BioWorld Today, March 18, 2003.) "We've made some improvements to the core technology," he said.

Investors in the Series B include MPM Capital, of Boston; Advanced Technology Ventures, of Waltham, Mass.; Forward Ventures, of San Diego; Flagship Ventures, of Cambridge, Mass.; Oxford Bioscience Partners, of Boston; GIMV, of Antwerp, Belgium; S.R. One Ltd., of Philadelphia; Jafco Ltd., of Palo Alto, Calif.; Alexandria Real Estate Equities, of Pasadena, Calif.; and Mintz Levin Investments, of Boston.

"They were pleased with results to date, and they were enthusiastic about investing more money," Fitzgerald said, declining to disclose more specific details about valuation.

In other financing news:

• BioCryst Pharmaceuticals Inc., of Birmingham, Ala., completed a $30 million direct offering of about 2.2 million shares to a group of institutional investors including Kleiner Perkins Caufield & Byers, of Menlo Park, Calif., and Texas Pacific Group Ventures, of Ft. Worth, Texas. The shares of common stock, priced at $13.46 each, were sold pursuant to a shelf registration. BioCryst's stock (NASDAQ:BCRX) closed Monday at $15.15, down 30 cents.

• Amarin Corp. plc, of London, entered definitive purchase agreements for a private equity placement consisting of American depository shares (each representing one ordinary share) and warrants for gross proceeds of $26.4 million. The company sold about 26.1 million ADSs at $1.01 per share and issued warrants to buy about 9.1 million more at an exercise price of $1.43 per share. Net proceeds, estimated at about $24.5 million, will enable the firm to finish its Phase III trials in Huntington's disease with the lead compound Miraxion, which are due to finish late next year or early 2007. Investors in the private placement include Southpoint Capital Advisors LP, of New York; Biotechnology Value Fund LP, of San Francisco; Fort Mason Capital LP, of San Francisco; Domain Public Equity Partners LP, of Princeton, N.J.; and other new and existing institutional and accredited investors, including certain directors and executive officers of Amarin. The company's stock (NASDAQ:AMRN) closed Monday at $1.07, down 10 cents.

• Inovio Biomedical Corp., of San Diego, entered a definitive agreement with a group of institutional investors, as well as Whitehouse Station, N.J.-based Merck & Co. Inc. and Vical Inc., of San Diego, to sell about $15.8 million of the Inovio's common stock at $2.40 per share, which represents a premium to the closing price on Dec. 15. Also, the firm will issue five-year warrants to buy 35 percent of the number of shares of common stock to be sold in the offering at an exercise price of about $2.93, a 25 percent premium to the Dec. 15 price. In addition to the securities being sold for cash, Inovio will be issuing shares of common stock and warrants (on the same terms as the corresponding securities) to certain holders of Inovio's outstanding cumulative convertible preferred stock in exchange for their preferred stock, pursuant to existing participation rights applicable to Inovio's new equity financings. Gross cash proceeds from the financing include $2.4 million due from an investor as part of its funding commitment made and promissory note delivered to Inovio in January. Proceeds will be used for working capital, including support of clinical trials for the company's lead product, its Selective Electrochemical Tumor Ablation System (SETAS), and general corporate purposes. SETAS started Phase I trials in October. The company's stock (AMEX:INO) closed Monday at $2.49, up 14 cents.

• BioAxone Therapeutics Inc., of Montreal, raised C$5.1 million (US$4.36 million) in the last tranche of a second-round investment of C$12.2 million, fully subscribed by current investors T2C2/Bio2000, Solidarity Fund QFL, Desjardins Venture Capital and Lothian Partners 27 SARL, all of Montreal. The investment was made following the completion of key milestones related to the company's ongoing Phase I/IIa trial with the therapeutic protein Cethrin in acute spinal cord injury, as well as progress in corporate development. Since the trial's initiation in February of this year, 20 patients have been enrolled in 10 U.S. and Canadian sites.

• Oragenics Inc., of Alachua, Fla., completed an equity-based financing with a group of accredited investors, raising about $1.1 million through issuing about 2.9 million shares of stock at 40 cents each, along with an equal number of warrants to buy shares, exercisable at 60 cents per share. The financing will help the company maintain progress with its SMaRT replacement therapy technology for preventing tooth decay, and preclinical work with the MU1140 antibiotic. The company's stock (AMEX:ONI) closed Monday at 53 cents, unchanged.

• Medivation Inc., of San Francisco, priced its follow-on offering of 4.9 million shares at $2 per share, and also granted the underwriter an option to purchase an additional 735,000 shares to cover overallotments. The company would bring in a total of $11.27 million, if the overallotment is exercised in full. Medivation develops biomedical technologies in the early development stage of the research and development process. Adams Harkness Inc. is acting as underwriter for the offering. Its stock (OTC BB:MPVN) rose 2 cents to close at $2.27.