Matrix Pharmaceuticals Inc. charged out of a nearly $50million public offering Tuesday selling 600,000 moreshares than expected, proving not all biotechnologycompanies were pinched by the industry's recent marketslide and recoil of investor interest.
In early September 1995, Matrix, of Menlo Park, Calif.,registered to sell 3 million shares and was trading at$12.75. Demand pushed the offering up to 3.6 millionshares and the price to $13.25, generating gross proceedsof $47.7 million. The company's stock(NASDAQ:MATX) closed Tuesday at $13.50, down 25cents.
In recent weeks, numerous biotechnology companiespeddling public offerings have found waning investorinterest following a record-setting volume of equitymarket financings during the summer.
Craig McMullen, Matrix's CEO, acknowledged theOctober market climate is tougher than the previous twomonths. But he suggested Matrix captured investors'attention with numerous products in late stagedevelopment, strong clinical trial data and a new drugapplication (NDA) on file with the FDA.
Matrix also had a good cash position, entering the follow-on offering with $38 million as of Sept. 30, 1995, enoughfor nearly two years. Add the $46 million in net proceedsfrom the current financing and with nearly $85 millionMcMullen said the company does not have to worryabout money as it prepares to commercialize its products.
The NDA submission, McMullen said, helped separateMatrix from other biotechnology companies competingfor investors' money.
Matrix filed an NDA for AccuSite injectable gel Sept. 26,1995, just prior to beginning its road show for the follow-on offering. The drug, initially targeted for genital warts,combines a chemotherapeutic agent with a sustained-release biodegradable protein matrix. An AccuSitemarket application for the same indication was filed inEurope in August.
AccuSite also is being tested in Phase III trials for basalcell cancer and a similar product, IntraDose withcisplatin, is being evaluated in Phase III studies for headand neck cancer.
Both AccuSite and IntraDose are injected directly into thedisease site. The sustained-release matrix is designed topermit use of increased chemotherapy doses and toreduce adverse side effects.
Following the offering, Matrix has about 16 millionshares outstanding. The underwriters _ Cowen & Co.,UBS Securities Inc. and Dillon, Read & Co. Inc., all ofNew York _ have the option of purchasing another500,000 shares to cover overallotments. n
-- Charles Craig
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