La Jolla Pharmaceutical Co. is padding its bank account, courtesy of a $17.2 million public offering.
The San Diego-based company on Friday agreed to sell 12.25 million common shares at $1.40 apiece. The per-share price represented a 4-cent discount to the prior day's closing bid on the stock. On Friday, the stock (NASDAQ:LJPC) lost 2 cents to close at $1.42.
All the shares are being offered by La Jolla, which in a prospectus said it would use a portion of the stock sale's proceeds to fund ongoing clinical trials of its lead product, Riquent (abetimus sodium), for lupus renal disease.
The product has been reviewed for clearance by the FDA, which last fall determined that Riquent is approvable but asked for an additional randomized, double-blinded study to demonstrate its clinical benefit prior to approval. The FDA's approvable letter indicated that the successful completion of a trial begun late last summer would satisfy that requirement.
That study received the FDA's backing under a special protocol assessment; it is designed to meet the requirements of a Phase IV post-marketing trial. The study is evaluating doses of 100 mg and 300 mg of Riquent over a 12-month period in lupus patients with a history of renal disease. The company also is conducting an additional study to evaluate higher doses of Riquent, 600 mg and 1,200 mg. Both dose levels have appeared to be well tolerated, and La Jolla said it might test additional dose levels in connection with the trial as previous studies showed that some lupus patients might benefit from higher doses of Riquent. Once the dosing study is completed, the company plans to review data with the FDA and, possibly, evaluate additional doses of Riquent in the trial that began in the summer.
Other uses of the funding include continued research and development of Riquent and other potential drug candidates, the expansion and validation of existing facilities, processes and infrastructures, and for other general corporate purposes.
La Jolla had 61.3 million shares outstanding as of Sept. 30. It also had $35.2 million in cash, cash equivalents and short-term investments through that date, and reported a $12.8 million net loss in the preceding quarter.
Pacific Growth Equities LLC in San Francisco is acting as the offering's underwriter.