A Medical Device Daily
Hemosol (Mississauga, Ontario), a company focused on the development of biologics, particularly blood-related proteins, reported that it has successfully implemented its Cas-cade technology for the extraction of therapeutic plasma proteins at a 30-litre scale. The company said it has "met or exceeded yield expectations and demonstrated significant improvement over existing manufacturing methods."
The company said the achievement of these milestones will allow it to move to clinical scale production later in the year.
The company also reported several important developments related to financing its growth, including agreements for financing transactions to raise aggregate gross proceeds of about $13.4 million, the extension of MDS's guarantee of Hemosol's $20 million credit facility and the amendment of the Cascade license agreement that will see ProMetic Biosciences a subsidiary of ProMetic Life Sciences (Montreal, Quebec), accept a combination of cash and common shares of Hemosol as part of the licensing fee associated with its agreements with Hemosol for use of the Cascade technology in the separation of therapeutic proteins from human plasma.
By achieving pilot scale with the Cascade technology, Hemosol said it has established a foundation to build toward clinical-scale production by the end of 3Q05. Once clinical scale is reached, investigational new drug applications related to the three initial lead proteins will be prepared and filed with the FDA followed by clinical development activity and full commercial scale-up of the Cascade process.
Following the successful completion of clinical trials, new drug applications will be filed with the FDA. Upon regulatory approval of the first product, commercial production could begin.
Hemosol has entered into a securities purchase agreement providing for the issuance, on a private placement basis, of a secured convertible note in the principal amount of $5 million to Laurus Master Fund.
The note is secured by a second charge over all of Hemosol's assets, and will have a term of three years and a conversion price of 69 cents, subject to adjustment.
The securities purchase agreement also contemplates the issuance to Laurus of a Hemosol warrant with a term of five years that will entitle Laurus to purchase 2,729,122 common shares at an exercise price of 86 cents per common share as to 54% and $1.04 per common share as to the remaining 46%.
The company also has entered into subscription agreements with purchasers providing for the issuance, on a private placement basis, of an aggregate of 10,948,731 special warrants of Hemosol at a price of 67 cents per special warrant, raising aggregate gross proceeds of roughly $13.4 million.
Each special warrant will be exercisable into one common share and one common share purchase warrant. Each warrant will entitle the holder to purchase one common share at an exercise price of $1 for a period of five years following the closing of the transaction. Hemosol has engaged Life Science Group and Loewen, Ondaatje, McCutcheon Ltd. as placement agents in connection with the financings.
In conjunction with the proposed private placements, the company has entered into a memorandum of understanding with MDS to extend the term of its guarantee of Hemosol's $20 million credit facility from June 20, 2005, up to June 20, 2007, in connection with the extension of such credit facility from May 25, 2005, up to May 25, 2007. The credit facility is to be increased by $1 million on a temporary basis.
Recom Managed Systems (Studio City, California) reported the completion of a private placement financing of $5 million with an unnamed institutional investor at $3.20 per share, with no commissions or other fees payable.
The company also issued warrants to purchase an additional 1.5 million common shares at $1.60 per share.
Recom said the financing will be used in large part to support commercialization of its Model 100 Heart Monitor 12-lead electrocardiograph (ECG) technology, which utilizes a signal-processing platform to allow for the production and recording of a clinical-quality ECG while the patient is ambulatory.
The Model 100 has received 510(k) clearance from the FDA.
Recom is an emerging life sciences company focused on the monitoring and detection of disease through continuous biomedical signal monitoring.
In other financing activity:
HemoSense (San Jose, California) said it has filed a registration statement with the Securities and Exchange Commission for a proposed initial public offering of shares of its common stock. The number of shares to be offered and the price range of the proposed offering have not yet been determined.
The company said the offering is expected to be made to the public "as soon as practicable."
The offering will be made through an underwriting syndicate led by WR Hambrecht + Co, and Roth Capital Partners. The offering will be made through WR Hambrecht's OpenIPO auction-based process.
Staar Surgical (Monrovia, California), a developer of minimally invasive ophthalmic products, reported that it has entered into a definitive agreement to sell 4.1 million shares of newly issued common stock at a purchase price of $3.50 per share to certain institutional investors.
The transaction is expected to close on or about April 5, subject to customary closing conditions. Pacific Growth Equities acted as the placement agent for the financing.
Windrose Medical Properties Trust (Indianapolis), a self-managed specialty medical properties REIT, reported that the underwriters of the company's recent public offering have exercised the over-allotment option to purchase 253,500 shares of common stock at the public offering price of $13.91 per share. The closing of the over-allotment option occurred last Thursday.
As a result of the exercise, the company received additional net proceeds, after underwriting discounts and commissions, of roughly $3.34 million, which resulted in total net proceeds from the offering of about $25.60 million.
Nicolaus & Company acted as underwriters and co-managers. Robert W. Baird & Co. was sole book-running manager. J.J.B. Hilliard, W.L. Lyons also served as an underwriter.
Windrose was formed to acquire, develop and manage specialty medical properties, such as medical office buildings, outpatient treatment and diagnostic facilities, physician group practice clinics, ambulatory surgery centers and specialty hospitals and treatment centers.
GeneOhm Sciences (San Diego), an emerging developer of molecular diagnostics, reported that it has closed a follow-on Series C funding with Partners HealthCare System (Boston), an integrated healthcare system of advanced tertiary and community-based medical centers.
It joins a syndicate of investors providing funding to accelerate the commercialization of GeneOhm's portfolio of molecular diagnostic products for applications in a number of areas, including rapid detection of bacterial infection and antimicrobial resistance.
"We believe that GeneOhm's rapid, molecular diagnostic products can transform the practice and outcome of infection detection and control in a way that will make important improvements in health-economics and patient care," said Jean Moses, director of corporate development for Partners HealthCare.