BioWorld International Correspondent
Medivir AB said Tuesday it is looking to raise about SEK322 million (US$43.1 million) in a 1-for-2 discounted rights issue.
Shareholders will be entitled to obtain one B class share, priced at SEK75, for every two A Class (which have preferential voting rights) or B Class shares currently held. If fully subscribed, the company would issue about 4.3 million new B Class shares. At the end of 2003, it had about 8.6 million shares outstanding, plus issued options on an additional 449,900 shares.
The company plans to use proceeds to move preclinical projects in autoimmune disease and osteoporosis into human development and to build up a Nordic sales force for both in-licensed niche drugs that already have gained approval and for its own pipeline. The latter step is central to the company's strategy of becoming a fully integrated small pharmaceutical company, Chief Financial Officer and Head of Investor Relations Rein Piir told BioWorld International.
Two projects are due to enter Phase III trials: ME-609 for treatment of oral and genital herpes, and RP-606, a shingles treatment partnered with Reliant Pharmaceuticals Inc., of Liberty Corner, N.J. The company is seeking a joint venture partner for its herpes product, which, Piir said, would be "a low-risk project" if the company can gain agreement on its Phase III trial design in discussions with the FDA. The company also has retained Nordic rights to two development-stage HIV compounds - MIV-310 and MIV-210 - which are partnered with Boehringer Ingelheim GmbH, of Ingelheim, Germany, and London-based GlaxoSmithKline plc, respectively. In total, it has nine cooperation agreements with eight companies.
But first it plans to gain Nordic marketing rights to products that already are approved, either through in-licensing or as part of a wider alliance with a pharmaceutical partner.
"We have identified a way of doing this, but we haven't started the process because we're not credible enough for this without the resources," Piir said. The company finished 2003 with SEK249.6 million in cash and equivalents. It has budgeted spending of SEK175 million for the current year, Piir said, exclusive of any income arising from milestone payments or new deals.
Handelsbanken Capital Markets is acting as Medivir's financial adviser on the share issue, the subscription period for which runs from May 3 through May 25. Medivir's stock closed at SEK135 Monday.