By Jim Shrine
Triangle Pharmaceuticals Inc. followed up its $48 million private placement two weeks ago with a $17 million financing Monday, this one involving sales of preferred stock.
Each of the 170,000 shares will convert into 10 common shares when stockholders approve the deal or after one year, whichever comes first. A dividend of $5 per share will be paid to those holding outstanding preferred stock after June 15.
Most of the focus at Triangle, of Durham, N.C., is on development of drugs for HIV and hepatitis B virus (HBV). The company has five products in the clinic, two of which are in pivotal studies.
Triangle's strategy has been to fund trials itself, rather than offset costs through collaborations. That method entails large expenditures.
"We've got a number of drug candidates that are progressing into later-stage clinical development, and that requires a substantial amount of additional capital," said Chris Rallis, Triangle's vice president of business development. "That's going to be the primary use of the proceeds from these financings."
If the shares are converted before June 15, the purchase price will be $10 per share, which is the price at which the stock sold in the earlier private placement. (See BioWorld Today, Dec. 16, 1998, p. 1.)
Triangle's stock (NASDAQ:VIRS) gained 75 cents per share Monday, closing at $13.50.
"Both transactions were important to the company to help fund our development efforts," Rallis said. "Right now we're trying to push these products through. That's occupying a great deal of our internal resources."
On Sept. 30, Triangle reported cash and equivalents of $73 million, with 24 million shares outstanding. Its net loss was $46.3 million through the first nine months of the year.
Rallis said Triangle takes a "portfolio" approach to drug development, with drug candidates being moved along as quickly as results dictate, rather than at a pace determined by costs.
"We try to push them ahead as quickly as reasonably possible," he said. "The ability to move quickly on each of the candidates helps identify early the ones that are most promising, and also the less promising [candidates]."
The lead product at Triangle is MKC-442, a non-nucleoside reverse transcriptase inhibitor being developed for HIV. Five pivotal trials are planned, including two combination studies in which enrollment has been completed.
The company's second product is FTC, a nucleoside analog from the same nucleoside series as 3TC. FTC has shown activity against both HIV and HBV. Phase II/III combination studies are under way with FTC in HIV, and a dose-ranging study is ongoing in HBV. Three other products are in earlier-stage studies, and a fifth is expected to enter the clinic in 1999. *