By Karen Pihl-Carey
ImClone Systems Inc. registered to sell 2.5 million shares of common stock that together with overallotment options could raise nearly $100 million for the company.
The underwriters ¿ Morgan Stanley Dean Witter, Merrill Lynch & Co., Prudential Vector Healthcare Group and Warburg Dillon Read LLC, all of New York ¿ have an option on an additional 375,000 shares to cover overallotments.
The New York-based company¿s stock (NASDAQ:IMCL) closed Thursday at $33.875, up $1.562. At that price, the offering would raise $97.4 million.
The company would have about 28 million shares outstanding following the offering.
According to the company¿s registration filing with the SEC, the money raised would fund the expansion of clinical trials, costs of the company¿s new manufacturing facilities and general corporate purposes. It would also cover costs to develop a sales force in the U.S.
For the second quarter ended June 30, ImClone posted a net loss of $8.1 million and said it had $2.7 million in cash.
Company officials were in a ¿quiet period¿ Wednesday and could not comment on the offering.
ImClone¿s lead product candidate is C225, an antibody that inhibits stimulation of a receptor found on the cells of certain solid tumors. The compound is in two pivotal Phase III trials for treating head and neck cancer ¿ one evaluating the drug in combination with radiation for cancer that has not metastasized, and one examining the effects of the drug in combination with cisplatin for metastatic or recurrent cancer. The company expects the studies to be completed in 2001.
C225 also is being tested in two Phase II trials in patients who have not responded to conventional cancer therapies. The company expects to have enough data from these studies within the first half of 2000 to determine whether results are sufficient to warrant an application for FDA approval.
ImClone also plans to test C225 in other indications, such as pancreatic, lung and renal cancers.
Also in a Phase III trial is ImClone¿s cancer vaccine, BEC2, a monoclonal antibody. It is being tested in the treatment of limited-disease small-cell lung cancer.
The company expects to file an investigational new drug application by the end of this year to begin clinical trials of c-p1C11, its lead anti-angiogenesis product candidate, which is an antibody that targets KDR, a principal receptor for vascular endothelial growth factor. The antibody is designed to inhibit or eliminate tumor growth.
In December 1998, Merck KgaA, of Darmstadt, Germany, joined with ImClone in a $90 million marketing agreement that gives Merck exclusive rights, except in Japan, to develop and market C225 outside the U.S. and Canada. So far, the company has received $14 million in up-front and milestone fees. ImClone retained its rights in North America and will co-develop the drug with Merck in Japan. (See BioWorld Today, Dec. 16, 1998, p. 1.)
ImClone also has granted Merck a license to develop and market BEC2 worldwide. The two companies would co-promote the vaccine within North America and ImClone would be the bulk manufacturer for worldwide production. n