By Randall Osborne

SIBIA Neurosciences Inc. has registered for a public offering, which — based on Monday's closing price of $7.875 per share — could raise $17.72 million for the company's research into nervous system disorders.

The company, of La Jolla, Calif., plans to offer 2.25 million shares, with another 250,000 shares to be offered by The Salk Institute for Biological Studies, also of La Jolla, with which SIBIA has a licensing agreement.

Underwriters — UBS Securities LLC, of New York, Piper Jaffray Inc., of Minneapolis, and Vector Securities Inc., of Deerfield, Ill. — were given an overallotment option of up to 375,000 shares. After the offering, the company will have about 11.5 million shares outstanding.

SIBIA has collaborations with Novartis AG, of Basel, Switzerland, targeting regulation of glutamate receptors in the brain for central nervous system (CNS) disorders; with Bristol-Myers Squibb Co., of New York, for amyloid precursor proteins for Alzheimer's disease; Eli Lilly and Co., of Indianapolis, for voltage-gated calcium channel drugs to treat stroke, epilepsy and chronic pain; and with Meiji Seika Kaisha Ltd., of Tokyo, for SIB-1508Y, for Parkinson's disease and cognitive disorders.

SIB-1508Y was shown to be safe and rapidly absorbed in a Phase I trial, the company reported in September. The drug is a nicotinic acetylcholine receptor (NAChR) that works by regulating the release of dopamine and acetylcholine. Deficiencies of dopamine are linked to progression of Parkinson's disease, and deficiencies of acetylcholine contribute to cognitive dysfunction.

Its licensing agreement with The Salk Institute, expanded in April 1996, gives SIBIA exclusive rights to NAChRs as drug discovery targets. The Salk Institute founded SIBIA in 1981 and holds patents that contain claims to various mammalian NAChR subunit clones. NAChRs act as a major excitatory system involved in many neuronal processes.

As of June 30, SIBIA had $3.67 million in cash, with a net loss of $2.62 million for the first six months of 1997.

The company's stock (NASDAQ:SIBI) closed Tuesday at $7.875, unchanged. *

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