By Matthew Willett
La Jolla Pharmaceutical Co. entered into agreements for the sale of $29.4 million in common stock that will go toward funding Phase III clinical testing of its lupus drug, LJP 394, and help fund research and development for the company's thrombosis drug, LJP 1082.
The 4.8 million shares are being sold at $6.125 each, a slight discount to Tuesday's closing price. The company said it entered into a definitive purchase agreement for the sale Wednesday, and expects the transaction to close July 24. Pacific Growth Equities Inc., of San Francisco, served as placement agent.
"This will allow us to move as aggressively as possible, both in terms of starting Phase III for our lupus drug and trials of our thrombosis drug," said Andrew Wiseman, senior director of business development and head of investor relations.
LJP 394 is designed to arrest the production of antibodies to double-stranded DNA in lupus patients without affecting the immune system's healthy function.
San Diego-based La Jolla researches and develops treatments for antibody-mediated diseases such as lupus, deep-vein thrombosis, myocardial infarction and antibody-mediated thrombosis, a clotting disorder.
LJP 394 development hit snags earlier this year when preliminary results of a Phase II trial indicated the drug was unlikely to reach it's primary endpoints. But updated data demonstrated that most patients showed high affinity antibodies for the drug, putting it back on track for Phase III testing. (See BioWorld Today, May 4, 2000, p. 1.)
Wiseman said La Jolla is going forward with plans to begin Phase III studies of LJP 394 later this year, and added that testing is projected to run two years, with 40 to 60 trial sites in the United States and 10 to 20 sites in Europe.
"With LJP 394, based on the positive clinical test results we announced few months ago, and following a positive meeting with the FDA, we're moving that drug into Phase III study, and our goal is to have the first patient enrolled in November," Wiseman said.
He added that La Jolla also is moving forward with plans to take LJP 1082, a thrombosis drug designed for stroke treatment, into the clinic in the first half of next year.
"We are very pleased to significantly impact our ability to move both our lupus drug and our thrombosis drug forward," Wiseman said. "The priority right now is focusing on those two drugs."
Following the new stock sale the company will have about 29 million shares outstanding, Wiseman said. La Jolla's stock (NASDAQ:LJPC) closed Wednesday at $7, up 25 cents.