By Kim Coghill
NeoTherapeutics Inc. filed a shelf registration covering the sale of debt securities, common stock, preferred stock, depository shares or warrants up to an aggregate total of $50 million.
Irvine, Calif.-based NeoTherapeutics develops small-molecule drugs for neurological and psychiatric diseases. The company's most advanced product, Neotrofin, is being developed for Alzheimer's disease, an indication for which the company is enrolling 500 patients for a Phase II/III trial, and other neurodegenerative diseases such as Parkinson's disease and spinal cord injury.
"We don't have any immediate plans to issue at this point," said John McManus, NeoTherapeutics' vice president for investor relations. "We are a development-stage company and we've got a number of products in our pipeline that over time will need to be developed. Basically, I think the money will be used to conduct clinical trials and preclinical research. But the thing for us is we just wanted the flexibility of having the shelf."
NeoTherapeutics has several products in the preclinical stage, including AIT-034 for dementia, AIT-203 for Parkinson's disease, AIT-297 for treating migraines and AIT-202 for depression and obesity.
McManus said future proceeds from this shelf registration likely will be spent on products in preclinical development, rather than on a product such as Neotrofin that already has adequate financial resources. And in the case of Neotrofin, McManus said clinical trials for Parkinson's disease and spinal cord injury are set to start in the first quarter.
NeoTherapeutics has two subsidiaries, NeoOncoRx Inc. and NeoGene Technologies Inc., both of Irvine.
NeoGene was formed in November 1999 to focus on functional genomics research, and paved the way for development of NeoOncoRx. NeoOncoRx, formed in November, focuses on anticancer drugs. McManus said the subsidiaries fund themselves. (See BioWorld Today, Nov. 30, 2000.)
In late December, NeoGene raised $2 million through the private placement of preferred stock with Societe Generale, of France.
NeoTherapeutics' stock (NASDAQ:NEOT) closed Wednesday at $3.50, up 12.5 cents.