By Mary Welch

Aphton Corp. raised $11.2 million in a private sale of common stock to an undisclosed investor, selling 800,000 shares at the market price of $14 each. There were no warrants, options or agent fees.

Company executives were unavailable for comment.

¿The fact that they raised this money ¿ did it themselves ¿ to one shareholder at market price definitely validates their technology,¿ said Jeffery Davis, president of Small Caps Online LLC, of New York. ¿It was a very cost-efficient transaction. Very clean. A lot of companies are offering deep discounts, but not here. It¿s important to note that this institutional investor, whoever it is, just bought a little more than 5 percent of the company.¿

Miami-based Aphton is developing products using vaccine-like technology for neutralizing hormones that participate in gastrointestinal system and reproductive system cancer and non-cancer diseases.

Davis believes the proceeds will be used to complete Phase III trials of Gastrimmune, an anti-gastrin immunogen, for colorectal pancreatic and stomach cancer. In addition, the company can enter Phase III trials for six more indications in the near future. The company is partnered with Pasteur Merieux Connaught Canada , a subsidiary of Rhone-Poulenc S.A., of Cedex, France.

¿The Phase II data was very compelling,¿ said Davis. ¿It¿s also a very interesting deal. Aphton doesn¿t take much up-front, which means that there is potential for some very lucrative payoffs coming as the drugs roll out. The deal with Pasteur was a 50-50 profit share.¿

Aphton¿s other lead drug candidate is GnRH pharmaccine, which is in Phase I/II trials with patients with advanced prostate cancer. The compound induces hormonal or biological blockage of testosterone. GnRH is being developed under a collaboration with London-based SmithKline Beecham plc. The two companies started their alliance in June 1998 to develop Aphton¿s Gonadimmune anti-gonadotropin releasing hormone (anti-GnRH) vaccines for several indications. SmithKline made a $5 million equity investment in the company. Gonadimmune induces antibodies in the patient which neutralize GnRH.

The company also has deals with the World Health Organization, of Geneva, Switzerland, and Schering-Plough Animal Health, of Madison, N.J.

Aphton¿s stock (NASDAQ:APHT) closed Wednesday at $14.375, up 37.5 cents.