Endo Pharmaceuticals Holdings Inc.'s largest stockholder stands to gain $232.5 million through the sale of 15 million shares.

Endo Pharma LLC, an affiliate of private equity investment firm Kelso & Co., priced the secondary offering of common stock at $15.50 per share. All of the shares are currently issued and outstanding.

Chadds Ford, Pa.-based Endo's stock (NASDAQ:ENDP) dipped 56 cents Wednesday to close at $15.51. Bill Newbould, the company's vice president of corporate communications, declined to comment given the SEC-imposed quiet period.

After the sale, Endo Pharma LLC will hold about 64 percent of Endo's outstanding common stock. That interest could be reduced to 62 percent if the underwriters choose the overallotment option to purchase an additional 2.25 million common shares at the same price.

Prior to the sale, Endo Pharma LLC controlled about 75 percent of Endo's outstanding shares - estimated at about 131.7 million. Certain members of management have an ownership interest in Endo Pharma LLC, though in the proposed offering it is expected that senior management will sell less than 5 percent of its aggregate ownership in the company.

Endo, which will not receive any of the proceeds from the proposed offering, continues to develop its pain management franchise.

Early this year, it bought exclusive U.S. and Canadian marketing and distribution rights to two development-stage pain products, DepoMorphine and Propofol IDD-D, from London-based SkyePharma plc. Endo made a $25 million up-front payment for the deal, which had a total potential of more than $100 million. (See BioWorld Today, Jan. 6, 2003.)

Weeks before, the company disclosed that a Phase III study of a later-stage pain product, MorphiDex, missed primary and secondary endpoints. But at the same time, Endo filed a new drug application for its opioid analgesic product candidate, its immediate- and extended-release oxymorphone oral tablets. (See BioWorld Today, Dec. 23, 2002.)

In partnership, Endo is working with Durect Corp. on the Cupertino, Calif.-based firm's Chronogesic pain therapy system, which is in Phase III studies.

The shares are being offered through an underwriting syndicate led by the New York firms Citigroup Global Markets Inc. and Bear, Stearns & Co. Inc., together with co-managers Jefferies & Co. Inc. and SG Cowen Securities Corp.