By Karen Pihl-Carey

Raising more than originally anticipated, Neurochem Inc. went public in Canada with an issuance of 3.9 million shares at C$8.25 each.

The initial public offering raised gross proceeds of C$32 million (US$21.7 million) for the Saint-Laurent, Quebec-based company.

"We were contemplating raising C$20 million to C$25 million, and it certainly surpassed our expectations," said Louis Lamontagne, president and CEO of Neurochem. "We, in fact, closed the order book at C$58 million."

The company had to cut back on the orders, but was allowed to raise as much as C$38 million, including overallotments, in the offering. Underwritten by Loewen, Ondaatje, McCutcheon Ltd. and Canaccord Capital Corp., the offering includes an overallotment option for an additional 581,818 shares at the offering price. If exercised in full, total gross proceeds to the company would be C$36.8 million. Lamontagne said he expects the overallotment sale to close next week.

"Considering the biotech markets have been volatile in recent months, this was indeed very good," he told BioWorld Today. "This is the largest IPO in biotechnology in Canada ever."

The company filed its offering earlier this month in Quebec, Alberta, Ontario and British Columbia. (See BioWorld Today, June 5, 2000, p. 1.)

Neurochem, a company formed in 1993 to develop compounds to inhibit the formation, deposition and associated toxic effects of amyloid fibrils in different bodily organs, plans to use net proceeds to fund clinical trials of its lead product candidates. Those candidates include Fibrillex, a glycosaminoglycan (GAG) mimetic designed to halt secondary amyloidosis as a result of systemic diseases; Alzhemed, a GAG mimetic to treat Alzheimer's disease; and Cerebril, the company's drug candidate for hemorrhagic stroke caused by cerebral amyloid angiopathy.

Fibrillex, which has been granted orphan drug status by the FDA, is expected to move into a pivotal Phase II/III trial in the fall, Lamontagne said. Alzhemed, which is the subject of a collaboration with H. Lundbeck AS, of Denmark, is scheduled to enter Phase II trials in mid-2001. And Cerebril likely will enter Phase II trials in the beginning of 2001.

The company also plans to use net proceeds to further complete lead optimization and initiate preclinical toxicology and pharmacology studies, as well as to cover costs for additional laboratory and analytical equipment and general and administrative needs.

Aside from its three clinical candidates, Neurochem has four drug candidates in preclinical testing to treat Type II diabetes. The company expects to select a lead molecule to take into Phase I trials sometime in 2001.

Neurochem has about 19 million outstanding shares. It had C$2.4 million in cash and cash equivalents as of March 31. The company's stock (TSE:NRM) closed Thursday at C$8.80, unchanged.