By Lisa Seachrist
Procyon BioPharma Inc. raised C$20.4 million (US$13.94 million) in a private placement of stock with a group of current and new investors.
The Montreal-based company sold the stock for C$2.62 (US$1.79) a share and offered a one-half-share purchase warrant with each share. Each whole purchase warrant may be converted into common stock for C$3.93 over the next 2 years.
Procyon intends to use the funds to advance its oncology drug candidates into clinical development. In addition, the company will look for opportunities to in-license new technologies.
¿We are unbelievably happy with the outcome of this financing,¿ said Hans Mdder, president and CEO of Procyon. ¿We now have enough cash to function for the next three years. We have enough cash to move products from all of our platforms through Phase II studies and into licensing agreements with pharmaceutical partners.¿
Mdder noted the company has two products in Phase III testing: Fibrostat and Colopath. Fibrostat is a topical cream used to reduce scarring from burns and surgical incisions. Procyon has licensed Canadian rights to the drug to Biovail Corp. International, of Toronto. Colopath is a non-invasive diagnostic test to detect colon cancer.
Procyon will move its prostate secretory protein 94 (PSP94) into clinical trials by the end of the year. PSP94 is a naturally occurring human protein with the potential to inhibit abnormal prostate cell growth. In addition, early next year, the company will initiate human trials of its Antinuclear Autoantibodies (ANAs) technology. ANAs enhance the immune response to cancer cells by binding to specific cancer cell types.
Mdder joined Procyon last August when the company was still located in London, Ontario. At that time, the company¿s stock was trading on the Vancouver-based Canadian Venture Exchange for under C$1 a share. Mdder moved the company in December to Montreal and completely reworked its business plan. As a result, Procyon¿s stock has moved to around C$3 a share.
¿We are looking at moving to the Toronto Stock Exchange soon,¿ Mdder said. ¿We will be on the radar screen of a lot more people by moving to the TSE. This is totally not the same company anymore.¿
Mdder said he¿d budgeted money to acquire three new technologies from universities as part of his plan for the proceeds of the financing.