SangStat Medical Corp. sold an additional 1 million shares in apublic offering of 3 million shares that was priced Friday at $14 pershare.
The offering grossed $42 million and netted the Menlo Park, Calif.,company about $39.1 million. On Feb. 11, 1996, SangStat registeredto sell 2 million shares when its stock was trading in the $15 range.
Underwriters Hambrecht & Quist LLC, of New York; MontgomerySecurities, of San Francisco; and New York-based Jefferies & Co.have a 30-day option to purchase an additional 450,000 shares tocover overallotments.
SangStat's stock gained $1.25 to close at $15.63 on Friday, whenmost biotechnology stocks lost value.
Henry Edmunds, SangStat's chief financial officer, said the companyand its brokers decided to expand the offering because of the stronginterest encountered among U.S. and European investors.
With the offering the company has about 12.6 million sharesoutstanding. The $39.1 million, combined with the $9.2 millionreported at the end of 1995, is expected to fund operations atSangStat at least through 1997, when some analysts have projectedthe company will be profitable.
"The financing allows the company a good deal of flexibility forfurther business development, both in the U.S. and Europe,"Edmunds said. "It also allows us to fully pursue and completeresearch and clinical development projects for a wide range oftherapeutic products."
SangStat has 11 products or product candidates for use in the area oforgan transplantation.
The one that may bring the company out of the red is Thymoglobulin,a polyclonal antibody being studied in a pivotal Phase III trial in theU.S. to treat graft rejection.
SangStat acquired rights to Thymoglobulin in the U.S. and Canadafrom Pasteur Merieux Serums et Vaccins, a subsidiary of Paris-basedRhone-Poulenc S.A. The drug is approved for use in 32 countries fortreatment of acute graft rejection episodes.
Edmunds said the pivotal U.S. study is expected to be finished in thesecond half of this year with the filing of a product licenseapplication to follow if results are positive.
SangStat recently reported news on two other product candidates. Itsaid it developed a cyclosporine formulation believed to bebioequivalent to the drug marketed by Sandoz Ltd., of Basel,Switzerland. The company said it intends to conduct trials in humanswithin the next 12 months to support a generic abbreviated drugapplication.
And SangStat reported Phase II results from Allotrap 2702 thatshowed statistically significant in vivo inhibition of cell-mediatedtoxicity. That inhibition is a marker that correlates with prolongationof graft survival without the need for continuous immunosuppression.
The company has monitoring devices on the market for identifyingorgan donors, and has filed a 510(k) submission seeking clearance ofCelsior to preserve the heart prior to transplantation. n
-- Jim Shrine
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