By Karen Pihl-Carey
Almost two weeks after CV Therapeutics Inc.'s shares jumped 56 percent in response to positive Phase III results of ranolazine, the company has registered for a public offering of 4 million shares.
The offering would gross $72.5 million if the shares sold at Friday's closing price of $18.125, which fell $1.375 on the day. The shares (NASDAQ:CVTX) had gained $3.50, or 22 percent, Thursday before the company disclosed the proposed offering. It has traded as low as $3.687 in the past six months.
The stock's recent strength had nothing to do with the company's decision to make the offering, CV's chief financial officer Dan Spiegelman said.
"That's just serendipity," he told BioWorld Today. "We've been telling investors for a year that our plan was to finish the first Phase III on ranolazine and that the data would be encouraging and we would go and try to raise money to finish the program."
CV Therapeutics, of Palo Alto, Calif., has granted the underwriters an option to purchase an additional 600,000 shares to cover overallotments. The underwriters are Donaldson, Lufkin & Jenrette Securities Corp., of New York; BancBoston Robertson Stephens, of New York; J.P. Morgan & Company Inc., of New York; and SG Cowen Securities Corp., of Boston.
The money should last CV Therapeutics at least through the first quarter of 2001, according to a company filing with the SEC.
"We're going to use the money to essentially continue development of ranolazine and to move our other clinical products along," Spiegelman said. "We plan on putting another product in the clinic next year."
For the second quarter ended June 30, CV Therapeutics had $38 million in cash and posted a net loss of $5.4 million. The company had 11.9 million outstanding shares, but the offering will raise that 34 percent to almost 16 million shares.
The company's stock has soared ever since it released initial results Aug. 19 from a Phase III study of ranolazine, the first in a new class of drugs known as pFOX (partial fatty acid oxidation) inhibitors. The study called MARISA - Monotherapy Assessment of Ranolazine in Stable Angina - showed that 175 patients with severe stable angina receiving either 500, 1,000 or 1,500 milligrams of ranolazine twice a day could remain on a treadmill from 22 to 49 seconds longer than placebo patients. (See BioWorld Today, Aug. 20, 1999, p. 1.)
With the completion of MARISA, CV Therapeutics has started a second Phase III trial called CARISA - Combination Assessment of Ranolazine in Stable Angina, which will study 750-milligram and 1,000-milligram doses of ranolazine in combination with either a beta-blocker or a calcium channel blocker.
The company hopes to file a new drug application for ranolazine sometime in 2001.
Right behind ranolazine, the company has in a Phase II trial of CVT-124 for the treatment of congestive heart failure, as well CVT-510 in a Phase I trial for atrial arrhythmias.