By Mary Welch
Aronex Pharmaceuticals raised $13.1 million through the sale of 6 million common shares to help fund its five products in clinical development.
Paramount Capital Inc., of New York, acted as the company's placement agent for the follow-on offering.
"It's never easy to raise money for biotech firms, even in the best of times, but Aronex is a good story," said Wayne Rubin, chief financial officer for Paramount. "We felt confident that our investors would be responsive, which they were."
Aronex reported having about $19 million in cash and nearly 15.6 million shares outstanding on Dec. 31, with a net loss of $18.2 million for the year.
The stock was sold at $2.1875 per share. Aronex (NASDAQ:ARNX) closed Wednesday at $2.375, down 21.88 cents.
Aronex's lead product is Atragen. Earlier this month the FDA accepted for review the new drug application (NDA) for Atragen, a liposomal injectable formulation of all-trans retinoic acid for acute promyelocytic leukemia (APL). The drug also is in Phase II studies for hormone-refractory prostate cancer and progressive non-Hodgkin's lymphoma, and Phase I/II for advanced renal cell carcinoma.
Following closely behind Atragen's development is Nyotran, an injectable liposomal formulation of nystatin, which is in Phase III for patients with presumed fungal infections. Last month, Aronex received a $5.6 million milestone payment from partner Abbott Laboratories, of Abbott Park, Ill., related to completion of patient enrollment and treatment required for the Phase III comparative multicenter trial of Nyotran against amphotericin B. The company expects to submit an NDA in mid-1999 for an indication in presumed, as well as confirmed, systemic fungal infections caused by Aspergillus and Candida. That product also is being studied in other fungal indications.
Aronex Chairman and CEO Geoffrey Cox said proceeds from the financing will go mainly toward seeing Atragen and Nyotran through the regulatory process.
"That's the main focus of the company at the moment," Cox said, "because they are our two most advanced products. What we want to do is make sure we get Atragen approved, and get a new drug application for Nyotran submitted and into the approval process.
"We are also trying to expand the indications for Atragen, the NDA for which was filed for APL, which is a relatively small indication," Cox said. "We believe, because the pharmacokinetics of this drug are so different, we have the opportunity to show the utility of it in a very different fashion in an oral dosage. It's a differentiating agent, and therefore has a high potential for use in combination with other chemo drugs.
"We've finished the Phase III clinical trial [for Nyotran], and the empiric-therapy trial, which is absolutely essential to the filing," Cox said. "We're doing the statistics at this moment, and we won't have results until probably late in the second quarter. We're trying to pull the whole thing together and get the filing [done] later this year.
"The labeling is still something we're discussing with the FDA," Cox said. "Empiric therapy is going to be the primary label we're going for. We'd like to have additional labels, but that will depend on the other trials we're doing."
Aronex has three other products in its pipeline, including Annamycin, a liposomal anthracycline designed to have the anti-tumor activity of this class of compounds without the severe adverse side effects. Annamycin is in a Phase II multicenter trial in breast cancer patients whose tumors are resistant to conventional therapies.
Another drug, Zinevir, is an HIV integrase inhibitor currently in Phase I/II trials. Aronex's final compound is Platar (AR726), a liposomal platinum product designed to overcome the toxicity and drug resistance that currently limit the usefulness of platinum drugs. It is in a Phase II trial.