* Cambridge NeuroScience Inc., of Cambridge, raised another $3.96 million from its recent public offering when underwriters Robertson Stephens & Co. LLC and PaineWebber Inc., both of New York, exercised their overallotment options. The company raised a total of $30.36 million in gross proceeds through the sale of 2.76 million shares at $11 per share. (See BioWorld Today, Feb. 3, 1997, p. 1.)

* Cell Therapeutics Inc., of Seattle, began a third Phase III trial of lisofylline, an anti-inflammatory compound under development for reducing toxic side effects of cancer chemotherapy, radiation and bone marrow transplants used to battle advanced blood cancers. The new study will test the drug in patients undergoing allogeneic bone marrow transplants from unrelated donors.

* Connective Therapeutics Inc., of Palo Alto, Calif., reported successful results from a long-term, open-label Phase II study of gamma interferon for adults and children with severe atopic dermatitis. Fourteen patients participated and after 22 months of treatment, skin area affected by the disease was reduced to 19 percent from an average 62 percent. Data from Phase III trials is expected by the end of 1997.

* Cypros Pharmaceutical Corp., of Carlsbad, Calif., said an open-label Phase II study of CPC-111 (fructose-1, 6-diphosphate) demonstrated the small molecule compound, which is designed to generate cellular energy in the absence of oxygen, improved heart muscle function in patients with coronary artery disease. The company said the trial indicates CPC-111, which is being studied for a variety of cardiovascular disorders, may be an effective positive inotrope, a class of drugs designed to increase heart muscle contraction.

* DepoTech Corp., of San Diego, began a Phase I trial of DepoCyt in children with advanced meningeal malignancies. DepoCyt, under development with Chiron Corp., of Emeryville, Calif., is a lipid-based form of the anti-cancer drug, cytarabine, for sustained release of the chemotherapeutic agent.

* Genzyme Corp., of Cambridge, Mass., signed an agreement with Kaken Pharmaceutical Co. Ltd., of Tokyo, to market in Japan the former's Seprafilm and Sepracoat products for prevention of post-operative adhesions. Kaken also has an option to market Genzyme's Sepragel, which is still in development. Financial terms were not disclosed. Seprafilm is under review for approval in Japan and a marketing application is to be filed in the second half of this year for Sepracoat. Seprafilm has been approved in the U.S., Canada and Europe. Sepracoat is under review by the FDA.

* Genzyme Transgenics Corp., of Framingham, Mass., said its transgenic mice successfully generated high levels of glutamic acid decarboxylase (GAD), a human protein targeted as a potential therapy for Type I diabetes. The mice are used to determine if introduction of the human gene for the protein can be accomplished in animals. Commercial scale production of the feasibility of GAD would be attempted in goats.

* Shaman Pharmaceuticals Inc., of South San Francisco, began a Phase II study of Virend, a topical cream for treatment of recurrent genital herpes. The placebo-controlled trial will enroll 400 patients in the U.S. and will evaluate the drug in combination with the antiviral agent, acyclovir, for treatment of herpes lesion in AIDS patients. Virend is derived from the croton plant, a traditional Latin American medicinal herb. The active ingredient in Virend is the same as that in Provir, an oral drug in clinical development for secretory diarrhea.

* SunPharm Corp., of Jacksonville, Fla., filed an investigational new drug application with the FDA to begin clinical trials with its polyamine analogue, diethylhomospermine (DEHOP), for treatment of ulcerative colitis. DEHOP also is in Phase II trials for AIDS-related diarrhea.