By Charles Craig

Guilford Pharmaceuticals Inc., with an FDA-approved drug on the market, and ArQule Inc., with five major corporate collaborations for its combinatorial chemistry, have proposed public offerings for a combined $123.6 million.

ArQule, of Medford, Mass., is heading back into the equity markets five months after a successful initial public offering generated $34.5 million in gross proceeds from the sale of 2.875 million shares at $12 per share.

As of Dec. 31, 1996, Arqule had $37 million in cash and reported a net loss of $3 million for last year. The company registered for a 2 million-share offering, but 367,500 shares will be sold by stockholders.

Based on ArQule's $18.50 closing price Friday of its stock (NASDAQ:ARQL), the company would raise about $30.2 million in the offering. Following the financing, ArQule will have about 11.5 million shares outstanding. Underwriters are Hambrecht & Quist LLC and Oppenheimer & Co. Inc., both of New York, and Vector Securities International Inc., of Deerfield, Ill.

ArQule's shares ended Monday at $18, down $0.50.

Guilford, which raised $40 million a year ago in a public offering, has registered to sell 3.25 million shares. Based on the $28.75 closing price Friday of its stock (NASDAQ:GLFD), the company would generate $93.4 million.

As of Dec. 31, 1996, Guilford had $77.4 million in cash, a net income of $5 million for the year and an FDA-approved brain cancer treatment, Gliadel, which is being marketed by Rhone-Poulenc Rorer Inc., of Collegeville, Pa.

Following the offering, Guilford will have about 18 million shares outstanding. Underwriters are Oppenheimer, Hambrecht & Quist and Alex. Brown & Sons Inc., of Baltimore.

Guilford's stock closed Monday down $1 to $27.75.

Gliadel, a biodegradable polymer containing the chemotherapy drug carmustine, is placed into a brain tumor site following surgery to kill remaining cancer cells. Guilford received approval of the drug as a second-line therapy for patients who have additional surgeries for recurrent gliobastoma multiforme, the most common and aggressive form of brain cancer.

The company sought clearance of Giladel as a first-line treatment with initial surgeries in all malignant glioma patients. To expand the drug's label, Rorer and Guilford expect to begin another Phase III study of Gliadel this year.

In addition to its drug delivery technology, Guilford is developing neurological treatments and diagnostics. The company expects to have Phase II results in the second quarter of 1997 for Dopascan, a small molecule labeled with iodine for diagnostic imaging of dopamine levels to detect and monitor Parkinson's disease.

Guilford's lead neurological drug development focuses on small molecules that promote nerve growth and repair for treatment of Alzheimer's and Parkinson's diseases and other neurodegenerative disorders.

ArQule has negotiated drug discovery collaborations with four pharmaceutical partners: Solvay Group, of Brussels; Abbott Laboratories, of Abbott Park, Ill.; Pharmacia Biotech AB, of Uppsala, Sweden, a subsidiary of Pharmacia & Upjohn, of Kalamazoo, Mich.; and Roche Bioscience, of Palo Alto, Calif., a division of Roche Holding Ltd., of Basel, Switzerland.

ArQule also has a collaboration for agriculture applications of its technology with Monsanto Co., of St. Louis.

In ArQule's combinatorial chemistry approach, it develops non-peptide, non-nucleotide organic chemical building blocks, which are based on a targeted binding site — such as an enzyme, protein or receptor — and are used to generate libraries of potential therapeutic compounds.

The company has an agreement with Aurora Biosciences Corp., of La Jolla, Calif., for use of its mammalian cell screening technology to assess the activity of small molecule drug candidates.

ArQule estimated proceeds from the follow-on offering plus existing cash and revenues from corporate collaborations will fund operations through March 1999. *