By Mary Welch
Tularik Inc. intends to sell 3.75 million shares, which at Thursday's closing price would gross about $297 million. The proceeds would be used for research and development, as well as to acquire or invest in complementary businesses and technologies.
Tularik's stock (NASDAQ:TLRK) closed Thursday at $79.125, down $1.50.
In addition, another 1.25 million shares will be offered by stockholders. However, Tularik will not receive any proceeds from the selling shareholders.
The company is in an SEC-imposed quiet period.
The offering is being done through an underwriting group managed by Lehman Brothers Inc., J.P. Morgan & Co., Chase H&Q, and Warburg Dillon Read LLC, all of New York, and Thomas Weisel Partners LLC, of San Francisco.
South San Francisco-based Tularik raised about $112 million when it went public in December. For 1999, the company reported a net loss of $25.5 million, or $2.70 per share, with revenues of $23.8 million. The company, as of Dec. 31, had $203 million in cash and 37.8 million shares outstanding.
Tularik's drug discovery program is based on gene regulation and allows for the identification of small-molecule, orally active drugs for a variety of diseases. The focus is on developing small-molecule drugs that counter inappropriate gene expression. Its potential drug targets are transcription factors, or proteins, which regulate gene expression, as well as other proteins that deliver the signals sending transcription factors into action.
Founded in 1991, Tularik has research programs in cancer, cytomegalovirus, diabetes, obesity, inflammation, allergy/asthma, high blood cholesterol levels and bacterial disease.
Tularik has several collaborative programs, and as of Dec. 31, the company's partners have committed $48 million in research funding over a five-year period. Partners include Knoll Pharmaceutical Co., of Mount Olive, N.J.; Roche Bioscience, of Palo Alto, Calif.; Taisho Pharmaceutical Co. Ltd., of Tokyo; and Japan Tobacco Inc., also of Tokyo.
Tularik has identified 14 drug leads and has three cancer drug candidates in clinical trials. They are: T138067, which acts on the same protein targeted by the cancer drugs Taxol and vincristine and is in Phase I trials; T900607, also in Phase I, which is an analog of T138067 and has the same target; and T904064, which was licensed by Indianapolis-based Eli Lilly & Co. and should begin Phase II trials this year.
Formerly known as lometrexol, T904064 is an antifolate, a class of drugs that disrupts the synthesis of DNA. Although the tumor types have not been selected for the Phase II trials, the company expects they will include melanoma and soft tissue sarcoma patients.
Although the company did not disclose the identity of those selling stock, the company's largest shareholders include Pharma Vision 2000 AG, of Glaris, Switzerland, and Peter Sjostrand, both owning 22.7 percent, or 10.1 million shares. Sjostrand is a board member of both Tularik and Pharma Vision 2000 AG, and a partner of BZ Group of Zurich, Switzerland.
In 1997, Tularik raised $51.25 million from Pharma Vision 2000, which was among the largest single financing in a private biotech company that year. Pharma Vision also participated in Tularik's 1996 round of financing that generated $62.7 million. (See BioWorld Today, Oct. 14, 1996, p. 1, and Sept. 4, 1997, p. 1.)