By Matthew Willett
Gilead Sciences Inc. will offer $250 million of convertible subordinated notes to institutional investors in a private placement, and will add $50 million to the offering to cover overallotments, if any.
The notes are convertible into Gilead common stock, and bear seven-year terms. Neither the conversion rate nor interest rate for the notes has been set.
Sheryl Meredith, Gilead's director of corporate communications, told BioWorld Today the company will use the proceeds from this round of funding for general corporate purposes.
"We intend to use the proceeds to fund clinical development, expansion of our sales force and commercialization capacity in anticipation of product launch, manufacture of late-stage clinical and commercial supplies and expansion of research and development, in addition to general corporate purposes like potential acquisition of businesses or technologies," Meredith said.
Gilead has developed four products through regulatory approval and commercialization, including Ambisome, a liposomal formulation of the antifungal drug amphotericin B, for treatment of fungal infections; Tamiflu, an influenza treatment; DaunoXome, a liposomal form of the anticancer agent daunorubicin; and Vestide, an antiviral for treatment of cytomegalovirus (CMV) retinitis in patients with AIDS.
Meredith said the company is pursuing commercialization of a number of therapeutics, including the HIV treatment Tenofovir, which was granted fast-track status by the FDA in November.
"We anticipate filing for Tenofovir DF in the U.S. and Europe in mid-2001, and we'll probably be announcing clinical data on our hepatitis drugs late next year," she said.
She added that Gilead is pursuing an additional indication, for pediatric use, for Tamiflu, and it plans to submit a supplemental new drug application for that indication by the end of next year. Gilead also is anticipating a Japanese approval for Tamiflu, she said.
According to its quarterly report, the company had about $293.2 million in cash, cash equivalents and marketable securities as of Sept. 30. Gilead had about 47 million shares outstanding as of that date.
The company has marketing agreements with Fujusawa Healthcare Inc., of Deerfield, Ill.; Hoffmann-La Roche Ltd., of Basel, Switzerland; and Pharmacia & Upjohn, of Peapack, N.J.
Gilead's stock (NASDAQ:GILD) fell $5.437 Monday, closing at $91.687.