By Mary Welch
Enzon Inc. registered to sell 2 million shares of common stock, which at Tuesday's closing price would bring in about $104.5 million.
Enzon's stock (NASDAQ:ENZN) closed Tuesday at $54.875, up $3.50 cents.
After the offering, Enzon will have about 40 million outstanding shares. The offering is being underwritten by Morgan Stanley Dean Witter, CIBC World Markets and SC Cowen Securities Corp., all of New York. The underwriters will have an option to purchase up to an additional 15 percent of the shares being offered to cover overallotments.
In addition, the Piscataway, N.J.-company said that the European Agency for the Evaluation of Medicinal Products (EMEA) recommended approval of Pegintron (peginterferon alfa-2b) for the treatment of adults with chronic hepatitis C.
PEG-Intron is a modified form of partner Schering-Plough Corp.'s Intron A (interferon alfa-2b) that was developed using Enzon's PEG technology to have longer-lasting properties.
"We are raising this money basically to expand our R&D program," said Kenneth Zueblis, Enzon's vice president of finance and chief financial officer. "Part of that would be used to develop additional PEG and SCA [single-chain antigen-binding protein] compounds. We're filling out our pipeline. Getting the word from the EMEA is just another piece of good news for us."
Enzon obtained the SCA protein technology with the acquisition of Genex Corp., of Gaithersburg, Md., in October 1991. SCA proteins, like monoclonal antibodies, deliver therapeutic agents to targeted disease sites but are easier to produce and are human. In addition, the company believes SCAs offer greater tumor penetration for cancer imaging and therapy, more specific localization to target sites and a more cost-effective manufacturing process.
Enzon has licensed the SCA protein technology primarily on a non-exclusive basis to more than a dozen companies. Currently, clinical trials for 12 products are under way by licensees as well as academic institutions. Some of the areas being explored are gene therapy, cancer therapy, cardiovascular indications and AIDS.
For the six-month period that ended Dec. 31, Enzon reported revenues of $6.78 million. The company posted a net loss of $3.5 million. Total cash reserves were $23.2 million.
Enzon and Madison, N.J.-based Schering-Plough expect final European approval in about three months. "They generally take about three to four months after a positive recommendation," said Bob Constalvo, Schering-Plough's director of external communications. The standard of treatment for hepatitis is Intron A, Schering-Plough's billion dollar drug, with ribavirin.
"In Europe, the combination therapy is the standard but this approval is for PEG as a monotherapy," Constalvo said. "Not all patients are able to take the ribavirin part, so this will be an option for those people."
Intron A was modified using Enzon's PEG drug delivery technology that employs polyethylene glycol to coat the protein, which helps prevent antibodies from binding to the protein molecule and reduces immunogenic reactions. As a result, the drug is able to remain in the bloodstream longer.
PEG-Intron as combination therapy with ribavirin (Rebetol) is currently in Phase III trials.
"That makes common sense," Constalvo said. "PEG is better than Intron A and if we could get PEG and ribavirin, it would be a superior combination."
Late last year, Schering-Plough filed a biologics license application for PEG-Intron powder for injection for the treatment of chronic hepatitis C in patients 18 years or older with compensated liver disease. (See BioWorld Today, Jan. 6, 2000, p. 1.)
PEG-Intron is also in Phase III trials for malignant melanoma and chronic myelogenous leukemia as well as in early stage trials for other solid tumors and forms of leukemia.
Intron A, marketed in 82 countries for 16 major indications, was licensed to Schering-Plough from Biogen Inc., of Cambridge, Mass.