By Randall Osborne

West Coast Editor

MGI Pharma Inc. revved its engines with what's been named a Flexible Underwritten Equity Facility, or FUEL, arrangement to sell up to $100 million in stock from shelf-registration shares.

The stock sale, to be made over two years by Ramius Securities LLC, of New York, will be important in funding MGI's oncology work, as well as for general corporate purposes, the company said.

Under the facility, Minneapolis-based MGI chooses the starting date and dollar amount of shares sold (subject to a limit based on daily trading volumes), sets a minimum sale price for each 10-day selling period, and pays Ramius 4 percent in commissions.

Ramius Securities gets a purchase option until Feb. 28, 2003, to buy up to 100,000 shares of MGI stock at prices that range from $16.95 to $24.72 per share. MGI's stock (NASDAQ: MOGN) closed Thursday at $13.562, down 43.75 cents.

MGI officials could not be reached for comment.

Last month, the company began its pivotal Phase III trial of irofulven (hydroxymethylacylfulvene) for advanced-stage pancreatic cancer in patients whose disease was not halted by gemcitabine. The study, with a primary endpoint of survival, will compare irofulven to 5-fluorouracil, a salvage chemotherapy.

In pancreatic cancer, which is a particularly virulent form, MGI reported success from a Phase II trial in November. Ten of 53 patients with advanced cases refractory to gemcitabine achieved six-month survival, which was the trial's primary endpoint. One patient experienced tumor shrinkage of 100 percent and a second patient showed 84 percent shrinkage.

Irofulven is the first agent developed from a family of anticancer compounds called acylfulvenes. Results from the study with 300 patients are expected to form the basis of a new drug application in 2003.

Ramius Securities is a brokerage and dealer, wholly owned by Ramius Capital Group LLC, an investment management and merchant banking firm. Ramius designed the FUEL acronym for the financing method, essentially a trademarked variant on the usual shelf registration and sale procedure already used by a handful of other companies.