By Karen Pihl-Carey
Boston Life Sciences Inc. raised $10 million through a private placement of common stock with the Pictet Global Sector Fund-Biotech, of Geneva, Switzerland.
The funding will enable the Boston-based company to advance its clinical programs of Altropane and Inosine, as well as submit a new drug application for Altropane. It also will further its earlier-stage product candidates, Flouratec and Troponin.
"We felt that in order to pursue those as rapidly as possible we should increase the cash on hand so we can increase the burn rate," said David Hillson, CEO and president of Boston Life Sciences.
The investment raises Boston Life Science's cash level to $25 million. While the company's burn rate in previous years has been about $7 million per year, the company has an expected burn rate of about $9 million in 2000.
"I would say this [the $25 million] would carry us to the end of 2002, a little over 2.5 years," Hillson said.
Under terms of the financing, Boston Life Science issued 1.41 million shares of stock to Pictet at $7.113 per share. The price was based on the weighted average sales price for the 10 trading days ending May 26. Terms also include the issuance of 500,000 warrants in two classes, some exercisable to purchase shares of common stock at $8 apiece, with others exercisable at $10 apiece.
Boston Life Sciences has about 19 million basic outstanding shares, and a $150 million market cap. Its stock (NASDAQ:BLSI) closed Friday at $8, down 12.5 cents.
Within the next 18 months, the company intends to submit an NDA seeking approval for Altropane, a radio-imaging agent, as a diagnostic to detect Parkinson's disease (PD). It also plans on completing one Phase II and two Phase III studies in adults of Altropane as a diagnostic for attention-deficit-hyperactivity disorder (ADHD). Company officials have said the market for ADHD is probably five times the size of the market for PD. Phase III results are expected shortly, Hillson told BioWorld Today.
The company hopes within the next 18 months to start Phase I studies in AF-1 and Inosine nerve growth factors in stroke or spinal cord injury, as well as a Phase I study for Troponin I, a naturally occurring anti-angiogenesis factor, in metastatic cancer.
And preclinical studies of Flouratec, a technetium-based diagnostic for PD, ADHD and other central nervous system disorders, will continue.
Pictet & Cie was founded in 1805 and has more than $100 billion of assets under management. The company advises the Global Sector Fund-Biotech, which has more than $850 million of assets under management.
"We would not have done a syndicated or a managed deal through an agent," Hillson said. The company receives all of the $10 million as no fees were involved in the financing. "We were very, very attracted by the character of this investor, and frankly, we hope it will help us generate interest in Europe."