Holders of British Biotech plc warrants issued in 1994 have cashed inon the U.K. company's surge in stock value, trading them for sharesat a premium of about 15, or $22.65, to the current market price,during the past month.
British Biotech, of Oxford, U.K., also has benefited considerablyfrom the warrant redemption, raising 47.5 million, or nearly $72million. The warrants _ good for the purchase of shares at 5.25, or$7.92, per share _ were part of a March 1994 rights offering thatraised an initial 46 million, or about $70 million.
British Biotech spokeswoman, Katie Arber, told BioWorld Today thetotal $140 million raised by her company in the rights offeringrepresents the biggest financing among U.K. biotechnologycompanies in recent years. Since 1986, when the company wasformed, British Biotech has raised more than $300 million, she saidThursday.
The company's most advanced product, lexipafant, is a plateletactivating factor antagonist being evaluated in Phase III trials foracute pancreatitis.
A cancer drug, marimastat, has generated the most excitement for thecompany recently with positive Phase II trial results in November1995. Marimastat, an oral compound, is designed to inhibit matrixmetalloproteinases, which are enzymes that break down connectivetissue around cancer tumors, allowing them to spread.
Marimastat, targeted for colorectal, ovarian, pancreatic and prostaticcancers, represents the product with the biggest market potential forBritish Biotech. Cancer patients currently are being enrolled in PhaseIII trials, which are slated to begin next year.
When British Biotech issued the rights offering 22 months ago, thecompany's shares were trading at about 4, or $6. Stockholderspurchased units for 16, or $24, that consisted of four shares andthree warrants. Each warrant could be redeemed for one share at5.25, or $7.92, between Dec. 11, 1995, and Jan. 31, 1996.
With the stock soaring to about 20, or $30.20, in the wake of thePhase II marimastat trials, the warrants were worth a 75 percentdiscount.
Nearly 99 percent of the warrants were exercised, giving BritishBiotech a total of 57.9 million shares outstanding.
Arber said that as of Nov. 30, 1995, British Biotech had about $45million in cash. With the additional $70 million generated from thewarrant trade-in, she said the company has enough money to keepoperating for another two to three years.
British Biotech's stock is traded on NASDAQ (BBIOY) in AmericanDepository Receipts (ADR). Each ADR equals two shares. The stockclosed Thursday at $65, down 87 cents. n
-- Charles Craig
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