By Frances Bishopp

Apollo BioPharmaceutics Inc. — which is developing drugs that protect brain cells from damage caused by disease, injury and aging — debuted Tuesday with an initial public offering of 1.2 million units at $5.375 each, grossing $6.45 million.

Each unit consists of a share of common stock and a warrant to purchase an additional share of common stock.

Each warrant entitles the registered holder to purchase, at any time until March 27, 2003, one share of common stock at an exercise price of $6.66 per share, subject to adjustment under certain circumstances. The components of the units are separately transferable immediately upon issuance.

The warrants are redeemable by the company, in whole or in part, at a redemption price of $0.25 per warrant, upon at least 30 days' prior written notice, beginning one year from March 27, 1997. They can be redeemed if the average of the closing bid prices of the common stock equals or exceeds $10.25 per share for 20 consecutive business days ending, within 10 business days of the date on which notice of redemption is given.

All of the units are being sold by the company. Apollo's stock (NASDAQ:ABPI) closed Tuesday at. $4.375, down $0.375.

After the offering, Apollo had 5,373,206 shares outstanding.

The offering is being managed by First United Equities Corp., of Garden City, N.Y. Apollo has granted First United Equities a 45-day option to purchase up to an additional 180,000 units to cover over-allotments.

Cambridge, Mass.-based Apollo BioPharmaceutics' target applications include the treatment of Alzheimer's disease, Parkinson's disease, brain damage resulting from stroke and other age-related diseases and conditions. Apollo's lead product candidates are based on naturally-occurring hormones that have been demonstrated to protect brain cells from damage caused by disease, trauma and aging.

Apollo's major product initiatives are based on estrogen compounds, calcitriol or vitamin D-related compounds and other types of neurosteroids.

ABPI-124 and Neurestrol, two of Apollo's lead product candidates, are in development by the company and its partners for prevention of neurodegeneration in Alzheimer's disease.

ABPI-124 is a type of estrogen Apollo believes will be useful in preventing brain cell death without inducing feminizing side effects. It can be used to treat men as well as women.

Neurestrol is an estrogen-based, subcutaneous implant in development for the long-term, controlled delivery of estrogen in a single dose for the treatment of Alzheimer's disease. Neurestrol is currently the subject of an investigational new drug application for Phase I testing in humans.

An additional product candidate, Neurocalc-TM, a derivative of vitamin D, is currently being evaluated in a small number of patients with Alzheimer's in a trial funded by the National Institutes of Health at the University of Kentucky Medical School.

In addition to its pharmaceutical product candidates, Apollo is also evaluating a home responsiveness diagnostic test that may predict responsiveness to hormone therapy.

Apollo has collaborations with Athena Neurosciences Inc., of South San Francisco, for the development of estrogen products for chronic neurodegenerative diseases, and with Endocon Inc., of South Walpole, Mass., for the joint development of Neurestrol.

Apollo has raised a total of $1,665,000 from the sale of common stock in three private placement offerings, resulting in gross proceeds of $640,000 in 1992, $475,000 in 1995 and $550,000 in 1996. The company issued convertible notes in 1994 and 1995 which provided gross proceeds to the company of $210,000.

Apollo's cash on hand as of Dec. 31, 1996, was $1.25 million and its net loss was $1.77 million. *