Vertex Pharmaceuticals Inc. priced an offering of three million sharesat $24 per share Friday, but like other biotechnology companiesgetting deals done Vertex saw its stock price drop significantlyduring the registration period.
Vertex (NASDAQ:VRTX) was trading over $30 when it registeredfor the offering early in July. The company, which had $77.3 millionin cash on June 30, 1996, will net $67.4 million from the offering.Vertex is losing about $30 million per year.
"We view it as being a very strong deal," said Lynne Brum, directorof corporate communications for Vertex. "We had support from ourexisting investors and high- quality new investors.
"It's very difficult to time the market," Brum said. "We thought thetime was right for us to describe the achievements we've hadrecently. That was the driving force to do the stock offering now."
Among the achievements described to investors were updates onprogress of the company's HIV protease inhibitor, VX-478, which isbeing developed with London-based Glaxo Wellcome plc.
Glaxo plans very soon to get under way with a series of Phase IIstudies that are expected to lead to the initiation of pivotal studies bythe end of the year, Brum said. The Phase II studies will involve avariety of doses and drug combinations to help in the final design ofpivotal studies.
There are expected to be four major pivotal studies of VX-478 aswell as a series of supporting studies, Brum said. They are likely tolook at VX-478 in combination with AZT and 3TC, the Glaxo-owneddrugs that form the basis of most HIV drug combinations; anotherstudy will add VX-478 to a protease inhibitor and nucleosidecocktail; and one study will test VX-478 in children because of whatappears to be tolerability advantages over existing proteaseinhibitors.
Vertex, of Cambridge, Mass., hopes to present an abstract describingantiviral activity of VX-478 at the Interscience Conference onAntimicrobial Agents and Chemotherapy (ICAAC) next month.
Vertex on its road show also updated investors on its Canadianpartner's intention to run trials with VX-710, a compound formultidrug resistance. The partner, BioChem Therapeutic Inc., ofLaval, Quebec, expects to start trials by the end of the yearcombining VX-710 and taxol for ovarian cancer and VX-710 anddoxorubicin for soft tissue sarcoma. Vertex already is in a Phase IItrial testing VX-710 and doxorubicin in liver cancer patients.
Vertex has taken VX-366, a compound to boost production ofhemoglobin F, through a pilot Phase II study for beta thalassemia.Partner Alpha Therapeutic Corp., of Los Angeles, is planning to doPhase II studies of the compound in sickle cell anemia patients, Brumsaid.
Vertex also disclosed a new program centered aroundneuroimmunophilins, with the idea to develop small moleculecompounds to stimulate nerve repair or help treat neurodegenerativedisorders. Some patents have issued, toxicology studies so far arepositive and a lead compound could be selected in 12 months, Brumsaid.
Vertex also has programs for inhibition of interleukin-1 convertingenzyme that could be useful for inflammatory conditions andinhibition of IMPDH, or the enzyme inosine monophosphatedehydrogenase, for autoimmune diseases. n
-- Jim Shrine
(c) 1997 American Health Consultants. All rights reserved.