Novogen Ltd.'s U.S. subsidiary, Glycotex Inc., filed for its initial public offering Friday to raise $39 million.

The company, which has a U.S. office in Stamford, Conn., is applying to list its common stock and warrants on the Nasdaq National Market under the symbols "GLTX" and "GLTXW," respectively.

Specific terms of the IPO, such as the number of shares to be offered and the expected price range, have not been determined. Philadelphia-based Janney Montgomery Scott LLC is acting as the sole underwriter.

Glycotex intends to use proceeds for clinical development and corporate expenses, including $4.3 million to conduct a Phase III trial in the U.S. for its lead product, MG3601, to treat venous stasis ulcers. It also has $2.8 million earmarked for salary and other staff costs, and $9.5 million budgeted for capital expenditures on laboratory equipment, a pilot-scale manufacturing plant and equipment to test and produce commercial quantities of glucan. Another $5 million would go toward expanding the research and product development program for other forms of glucan, including its second pipeline product, JSD114. Any remaining proceeds would go toward leasing office and manufacturing facilities and for general corporate purposes, including required payments to Novogen.

A few years ago, Sydney, Australia-based Novogen decided to segregate its two technologies in the glucan and phenolic drugs areas, forming Glycotex to focus only on the glucan technology. The company began operations in May 2003. Currently, Novogen owns about 84.3 percent of Glycotex's outstanding common stock.

Glycotex holds exclusive, worldwide rights to use and exploit the glucan technology for therapies of skin ulceration, bone fracture and the enhancement of fixation of implanted orthopedic devices, injured connective tissues, joint repair, poorly healing surgically dissected or transected tissue, and the prevention and treatment of ultraviolet light induced skin damage.

The technology is based on a molecule that binds to glucan receptors, which are expressed on the cells involved in the innate healing cascade. It activates critical cells, like macrophages, fibroblasts, vascular endothelial cells, epithelial cells and neutrophils. To date, Glycotex has developed Glucoprime and Glucocol, which have been engineered as the active ingredient for topical therapies, and for intra-body therapies including the treatment of tendons, ligaments, joints and bones, respectively.

In March, Glycotex completed a Phase II trial of its lead product, MG3601, in treating trophic ulcers - large wounds that are prone to serious infection. Results of the 60-patient trial conducted in Australia demonstrated that the product provided a statistically significant rate of improved wound closure compared with placebo. Glycotex intends to start a Phase III trial in 2006 of MG3601 for venous stasis ulcers. MG3601 contains Glucoprime as its active ingredient.

Glycotex also is developing JSD114, which contains Glucocol as its active ingredient, to accelerate healing of surgical incisions that are at risk of wound breakdown. The product is currently in preclinical development.

More than 4 million Americans suffer from chronic non-healing wounds each year, according to the National Institutes of Health. Glycotex said that its products will fulfill a large unmet medical need for human wound healing and tissue repair products. The estimated worldwide advanced wound care market was $2 billion in 2004 and is expected to grow to $2.8 billion by 2008, it said.

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