CV Therapeutics Inc. is raising $158 million through the sale of 7.3 million shares of common stock at $21.60 per share.
At the same time, it also agreed to sell $130 million of its 3.25 percent convertible senior subordinated notes due 2013, with an overallotment option of up to $19.5 million more in notes. Net proceeds from both offerings are expected to pay outstanding debt, as well as support ongoing clinical development of the company's cardiovascular products and other business activities.
Company spokesman John Bluth said the firm was not able to comment due to SEC quiet-period rules. Shares of CV Therapeutics (NASDAQ:CVTX) closed Wednesday at $22.05, unchanged.
The Palo Alto, Calif.-based company, which is preparing to submit an amended new drug application for its lead product in angina, originally planned to sell about 6 million shares. If underwriters purchase the total about 1.1 million shares to cover overallotments, the offering would total $180 million.
That would make it the second-highest public offering completed this year, just ahead of Vertex Pharmaceuticals Inc., of Cambridge, Mass., which completed a follow-on offering earlier this month totaling $175.7 million. So far this year, Amylin Pharmaceuticals Inc. has raised the most. The San Diego-based company closed a $202.4 million offering in January.
According to its prospectus, CV Therapeutics intends to redeem the outstanding $79.6 million principal amount of its 4.75 percent convertible notes due 2007, and expects to use about $13.2 million from the notes offering to fund an escrow account for the first six payments on the notes. The remaining net proceeds will go toward business operations, which could include preclinical and clinical trials, research and development, regulatory filings and product commercialization costs.
The financings add to the $389.9 million the company reported in cash, cash equivalents and marketable securities as of March 31. CV Therapeutics posted a net loss of $46.4 million for the first quarter. Operating costs totaled about $51.5 million, much of that going to fund two Phase III trials of its angina drug, Ranexa.
After receiving an approvable letter in November 2003 for Ranexa, CV Therapeutics followed up with an additional Phase III study. Results reported in April showed that the drug reduced weekly angina frequency compared to placebo. The company anticipates filing an amended NDA for Ranexa by the end of August and, if granted priority review by the FDA, could receive marketing approval during the first half of 2006. (See BioWorld Today, April 19, 2005.)
A second Phase III study of Ranexa is ongoing to evaluate safety and efficacy of the drug during acute and long-term treatment. The company has said that positive results from that trial could lead to a broader indication.
In addition to Ranexa, CV Therapeutics has two ongoing Phase III trials of regadenoson, a selective A2A-adenosine receptor agonist, for use as a pharmacologic stress agent in cardiac-perfusion imaging. Data from one trial are expected during the third quarter, and the company expects to report results from the other by the end of the year.
The company also has a third product in Phase III development; tecadenoson, another selective A2A-adenosine receptor agonist, is being tested as a treatment for atrial arrhythmia.
Several preclinical programs are ongoing to develop products for the treatment of chronic heart failure, cardiopulmonary disease and atherosclerosis.
The company's convertible notes can be redeemed at any time on or after Aug. 20, 2010, and will be convertible by holders at maturity into shares of common stock at an initial conversion price of about $27. Both offerings are expected to close around July 1.
New York-based firms Lehman Brothers and Merrill Lynch & Co. are acting as joint lead managers and joint bookrunners for the offerings. Piper Jaffray, of Minneapolis, along with SG Cowen & Co. and First Albany Capital, both of New York, are acting as co-managers of the stock offering, while Citigroup and Deutsche Bank Securities, both of New York, served as co-managers of the convertible note offering.
In other financing news:
• Auxilium Pharmaceuticals Inc., of Malvern, Pa., is raising $40.4 million through a private financing to support commercialization, as well as research and development efforts. The company, which develops treatments focused on urologic and sexual health, has a Phase II product for the treatment of Peyronie's disease and Dupuytren's disease, and other candidates for androgen replacement, overactive bladder and pain. Auxilium entered agreements with institutional and other investors for the private placement of about 8.2 million shares of common stock at a price of $4.90 per share, along with warrants to purchase about 2.1 additional shares at a price of $5.84. The private placement is expected to close on or before July 13. Deutsche Bank Securities Inc., of New York, is acting as the lead placement manager.
• Immunicon Corp., of Huntingdon Valley, Pa., expects to receive gross proceeds of $19.7 million from the sale of about 4.1 million shares of its common stock to institutional investors at $4.75 per share. The proceeds will be used to further the development and commercialization of the company's cancer diagnostic products, as well as supporting the development of products outside the field of cancer. Immunicon develops cell- and molecular-based human diagnostic products and products for cancer disease management. Its platform technologies are designed for selection and analysis of rare cells in blood, such as circulating tumor cells and circulating endothelial cells. Legg Mason Wood Walker Inc., of New York, is lead placement agent for the public offering, with First Albany Capital Inc., also of New York, serving as co-placement agent.
• Innovive Pharmaceuticals Inc., of New York, raised $2.25 million in a convertible note financing. The investment will contribute to the privately held company's goal to acquire, develop and commercialize therapeutics in the fields of oncology and hematology. Innovive recently licensed worldwide rights to INNO-105, an opioid growth factor, from Penn State University. It is designed to inhibit cell growth and division by interacting with a receptor found in several malignant cells, such as pancreatic adenocarcinoma. New York-based Paramount BioCapital served as placement agent for the financing.
• Santaris Pharma A/S, of Copenhagen, Denmark, said it received additional financing of €4.4 million (US$5.3 million), part of the company's second private financing that is expected to raise a total of €20 million and close in the second half of the year. Santaris said proceeds will be used to further develop its pipeline of drug candidates, including SPC2996, which is in a Phase I/II study in patients with chronic lymphocytic leukemia, and SPC2968, an RNA antagonist aimed at blocking neovascularization that is set to begin a Phase I/II study next year. A third product, SPC3042, also an RNA antagonist, is in preclinical development for cancer and is expected to enter clinical testing sometime next year. Lead investors in the financing were BankInvest, of Copenhagen; Novo, of Bagsvaerd, Denmark; LD Pension, of Copenhagen; InnovationsKapital, of Stockholm, Sweden; Dansk Kapitalanaeg, of Copenhagen; and Dansk Erhvervsinvestering, also of Copenhagen.