With the hope of moving its lead product into a Phase III trial next year, Nuvelo Inc. raised $24.5 million in a private placement of stock.

The company sold a total of 10 million shares at $2.45 per share to unaffiliated institutional investors. The placement drew down shares from the company's shelf registration filed in July. Another $25 million worth of securities remains on the shelf.

"The money will definitely be used for clinical trials of alfimeprase, as well as pushing some of our other research programs forward," said Nicole Estrin, manager of corporate communications and investor relations at Sunnyvale, Calif.-based Nuvelo. "We didn't have to do a financing - we chose to do one. It was a great time to do one for us. We've had a lot of interest in the company right now."

Alfimeprase, the company's lead product, entered two Phase II trials in June, one in peripheral arterial occlusion (PAO) and the other in catheter occlusion.

"We expect to complete at least one of those trials by the end of the year," Estrin told BioWorld Today.

The company also expects to begin a Phase III trial in the first half of 2004.

Estrin said the company had about $29 million in the bank at the end of the second quarter. Nuvelo's burn rate is about $3 million a month, meaning the latest financing should cover a little more than eight months worth of the company's expenses. Nuvelo last raised money in April 2002 with a $15 million private placement. Before that, it raised $21.3 million in a private placement in August 2001.

Aside from developing alfimeprase, the company plans to use the money from the latest financing for general corporate purposes, as well as other research and product development activities.

Nuvelo is pursuing "potential clinical-stage in-licensing opportunities," Estrin said. It also is focusing on two research programs - one in secreted proteins and the other in immunotherapeutics. In the immunotherapeutics program, it has identified four preclinical candidates for cancer.

The Phase II trial of alfimeprase in PAO is a multicenter, open-label study designed to evaluate safety and efficacy of three different doses of the compound in about 100 patients in the U.S., Europe and South Africa. In Phase I trials, alfimeprase was shown to be safe and well tolerated with no related adverse events in PAO.

The trial in catheter occlusion is a multicenter, randomized, double-blind study evaluating alfimeprase in restoring function to occluded central venous catheters. That study is comparing three doses of alfimeprase against the approved dose of t-PA (alteplase) in about 100 patients in 20 centers across the U.S.

Last week, Nuvelo reported the successful completion of an interim analysis of the Phase II trial in 36 acute PAO patients. The Data Safety and Monitoring Board recommended the company move forward with the trial in all three doses being tested.

Alfimeprase is a thrombolytic agent or clot dissolver. It is a naturally occurring enzyme that degrades fibrin when delivered through a catheter at the site of a blood clot. It has received orphan drug designation for the PAO indication, as there are no products on the market widely used to treat the condition. PAO can cause death and amputation with more than 100,000 cases reported annually in the U.S. Catheter occlusion occurs in about 20 percent to 25 percent of the 5 million catheters placed in patients each year in the U.S. Current treatment involves surgery to remove or replace the catheter or treatment with South San Francisco-based Genentech Inc.'s Cathflo Activase (alteplase).

Alfimeprase also has potential in the deep vein thrombosis and stroke indications, Nuvelo said. The product came into the company's hands through a partnership with Amgen Inc., of Thousand Oaks, Calif., in January 2002. Nuvelo is responsible for all clinical development and Amgen is responsible for manufacturing, with the option of leading commercialization efforts. Both companies share worldwide commercial rights. (See BioWorld Today, Jan. 10, 2002.)

In September, Nuvelo licensed its entire chemical cleavage patent estate to Sequenom Inc., of San Diego, in return for a licensing payment and potential royalties. The company acquired the 25 issued and pending patents, as well as an exclusive worldwide license to nine additional restriction enzyme patents, through Variagenics Inc., of Cambridge, Mass. Variagenics merged with Hyseq Pharmaceuticals Inc. in January to form Nuvelo. (See BioWorld Today, Jan. 22, 2003.)

JMP Securities LLC, of San Francisco, served as the sole underwriter of the financing.

Nuvelo's stock (NASDAQ:NUVO) closed Thursday at $2.67, down 5 cents.