By Randall Osborne

West Coast Editor

With an eye to furthering its genomics-based approaches to ocular disease, InSite Vision Inc. has filed a shelf registration to sell $40 million in stock, using the proceeds for working capital and general corporate purposes.

Meanwhile, the Alameda, Calif.-based company said a program for which it raised $13 million in a private placement last year may have to be discontinued, due to problems buying supplies of the eyedrop drug.

InSite's stock (AMEX:ISV) closed Monday at $2.95, down 54 cents, or 15.5 percent, after falling as low as $2.50 during the day. The company's 52-week high is $8.50, and its 52-week low is $2.188.

In its glaucoma program, InSite uses the trabecular meshwork inducible glucocorticosteroid response (TIGR) gene and others for its ISV-900 test and for ISV-205, a therapeutic agent being developed with Pharmacia Corp., of Peapack, N.J.

ISV-205 employs InSite's DuraSite technology, a delivery system that comprises a patented eyedrop formulation of a cross-linked carboxyl-containing polymer. The drug in ISV-205 inhibits, in cell and organ cultures, the production of a protein that appears to cause glaucoma, InSite said.

In June 1999, the company disclosed positive data from its steroid-induced glaucoma Phase II trial of ISV-205, and Pharmacia has assumed the continued development of the product, with InSite's technical support.

ISV-615 is an eyedrop for retinal degeneration. Its active ingredient is batimastat, which had been supplied by British Biotech plc, of Oxford, UK, which has terminated license negotiations, according to InSite's registration filing. (See BioWorld Today, May 4, 2000.)

"If we cannot obtain [batimastat] from British Biotech, we most likely will not have any source of ongoing raw materials for ISV-615 and we may be forced to discontinue this program," the filing says.

InSite also has in the works ISV-401, an antibiotic that has not previously been used in ophthalmology, and may be effective for Gram-negative and Gram-positive bacteria. The DuraSite formulation may allow for reduced dosing frequency, InSite said. A delivery device, ISV-014, also is under development. It directs ophthalmic drugs nonsurgically to the retina and surrounding tissues.

Placement agent for the shelf offering is Ladenburg Thalmann & Co., of New York.