West Coast Editor
Having trimmed its personnel count earlier this month to save money, BioMarin Pharmaceutical Inc. said it plans to offer 8.5 million shares of stock at $7.05 per share at a total price of about $59.9 million, with net proceeds expected to be about $56.6 million.
The company's stock (NASDAQ:BMRN) closed Thursday at $7.50, down 6 cents.
Shares are being offered through a $150 million shelf registration filed in late December 2002, which said the money raised would be used for general corporate purposes and working capital.
Joshua Grass, director of business development and finance for Novato, Calif.-based BioMarin, said the company is in a quiet period as required by SEC rules and could not comment.
According to the original shelf-registration prospectus, money raised may be used for (among other things) funding of the joint venture with Genzyme Corp., of Cambridge, Mass., for Aldurazyme, the enzyme-replacement therapy for mucopolysaccharidosis I. The drug's sales forecast, which had been set at between $60 million and $66 million this year, was upped about a week ago to between $70 million and $75 million. (See BioWorld Today, July 7, 2005.)
That upbeat news came along with word that the company was laying off 58 people as a result of generic competition for its pediatric asthma drug Orapred (prednisolone solution), a move made to reduce operating expenses by about $3 million this year and by about $9 million onward.
BioMarin has "gone to the shelf" previously, and that financing also came at about the same time as favorable Aldurazyme news. In February 2003, the company raised $75 million by selling 7.5 million shares at $10 apiece to bring in $75 million, just as an advisory body in Europe recommended Aldurazyme be approved there. The compound since has been approved in Europe. (See BioWorld Today, Feb. 23, 2005.)
Along with Aldurazyme and Orapred, BioMarin has Naglazyme (galsulfase), an enzyme-replacement therapy for MPS VI, approved this summer. The product development pipeline includes Phenoptin (sapropterin hydrochloride), a Phase III candidate for phenylketonuria. Overseas rights to that drug have been licensed to Serono SA, of Geneva, as part of a $257 million deal. (See BioWorld Today, June 2, 2005, and May 17, 2005.)
Phenoptin's active ingredient is a synthetic form of 6R-BH4 (also referred to as BH4), the naturally occurring enzyme cofactor required for the production of nitric oxide, which regulates dilation and constriction of blood vessels. For vascular dysfunction, the drug is at the Phase I stage.
Merck Eprova AG, a subsidiary of Darmstadt, Germany-based Merck KGaA, gave BioMarin the 6R-BH4 product for development to treat PKU and other genetic disease indications. Later, BioMarin entered a partnership with Daiichi to exclusively receive preclinical and clinical data on 6R-BH4, and gain access to the commercial-grade formulation. (See BioWorld Today, Nov. 21, 2003, and Nov. 29, 2004.)
In May, BioMarin licensed from Daiichi exclusive worldwide rights (excluding Japan) for the use of 6R-BH4 to treat the endothelial dysfunction that causes vascular complications in diabetes, cardiovascular and other diseases. BioMarin paid undisclosed cash up front, plus royalties and development milestones for up to two indications.