Introgen Therapeutics Inc. raised $11.5 million Wednesday through the private placement of 2 million common shares.
The Austin, Texas-based company priced the stock at $5.75 per share, representing about a 10 percent discount to Tuesday's closing price. Introgen, which had about 21.5 million shares outstanding as of March 31, said it would use proceeds primarily for working capital purposes and to further develop its two late-stage anticancer product candidates, Advexin and INGN 241. The former, which delivers the p53 gene to tumors via an adenoviral vector, is in Phase III studies in head and neck cancer, while the latter remains in a Phase II program.
"The transaction strengthens our balance sheet," Tom Finnegan, Introgen's vice president of finance and corporate development, said in a prepared statement. Company officials were not available for comment.
But in the release, Finnegan added that the latest financing combined with current cash on hand, reported at about $19.1 million on March 31, would provide "ample resources" to file Advexin's biologics license application and advance other programs.
Introgen owns all rights to Advexin, which also is in a Phase II program in lung cancer.
The company, which lost about $5.4 million in the first quarter, also issued warrants to initial buyers for an additional 400,000 shares at $7.89 apiece, with the right to force the warrants' exercise after two years. It sold the shares to a group of unnamed institutional investors.
The dilutive news lowered Introgen's stock (NASDAQ:INGN) Wednesday by 67 cents, or 10.5 percent, to close at $5.70. But the price remains substantially higher than the $2 range in which it hovered for much of the past year.
Findings presented at a pair of scientific meetings helped the stock's value swell in recent weeks. In a period of six days spanning the end of May and early this month, coinciding with the American Society of Clinical Oncology meeting in Chicago, the shares rose from just under $3 to more than $5.50. Additional data released at the American Society of Gene Therapy meeting last week in Washington pushed the stock higher. The data from Phase I and II studies in patients with solid tumors demonstrated that INGN 241, its MDA-7-based cancer drug, was well tolerated and biologically active, and that minimal toxicities were associated with treatment.
The company's shares climbed as high as $8.92 at the close of business June 9, the day's surge driven by data showing INGN 007 overexpresses a gene that allows the vector to saturate the tumor and eradicate cancer in animal models. The news also was presented at the gene therapy meeting.
Introgen also owns all rights to INGN 241.