By Lisa Seachrist
Looking to fund itself through to profitability, InKine Pharmaceuticals Co. Inc. raised about $10.8 million in a private placement with a group of institutional investors.
The Blue Bell, Pa.-based company sold 2.39 million common shares at $3.90 per share to a group of investors led by Baltimore-based Cahill, Warnock & Co. LLC. The private placement was priced at a 15 percent discount to a 10-day trailing market average. Leerink Swann & Co., of Boston, acted as placement agent.
"By all accounts this financing was a tremendous success," said Robert Apple, chief financial officer for InKine. "The majority are new investors and this was a pure common stock deal. We now have $17 million in cash and that should see us to profitability."
InKine is dedicated to the diagnosis and treatment of cancer and autoimmune diseases. In November, the company submitted its first new drug application (NDA), for Diacol, a purgative agent for adults undergoing colonoscopic testing. Diacol, a patented anhydrous sodium phosphate tablet, is designed to clean the bowel in order to allow doctors to view any polyps and detect early colon cancer.
In Phase III clinical trials, the product proved as effective as the leading purgative agent, NuLytely. Patients, however, largely preferred Diacol to NuLytely. Diacol is currently under review at FDA, and Apple said the company anticipates a market launch of the drug by the end of this year. (See BioWorld Today, Nov. 24, 1999 p. 1; and April 30, 1999, p. 1.)
In addition to Diacol, InKine has its orally administered steroid, CBP-1011, in a Phase III study in idiopathic thrombocytopenic purpura and Phase II studies for both Crohn's disease and ulcerative colitis. InKine recently completed a pharmacokinetic study in healthy volunteers to assess whether a tablet formulation provides the same level of drug as the capsule form that has been used to date.
"It's basically a bridging study for the tablet formulation," Apple said. "The capsules were filled by hand, and that doesn't lend itself to large-scale production."
Once FDA is satisfied the tablet form delivers the same dosage of CBP-1011 as the capsule form, the company will use the tablets to complete the Phase III study. The Phase II study results in Crohn's disease are expected at the end of August, while the results in ulcerative colitis are expected in October.
InKine also has several products in preclinical development including Angiocidin, an angiogenesis inhibitor for use in cancer patients.
"Essentially, the cash we raised during this financing would take us through 2001," Apple said. "That would include getting Angiocidin through Phase I."
InKine's stock (NASDAQ:INKP) closed Monday at $6.062, down 21.88 cents.