CytoTherapeutics Inc., without a road show orunderwriters, completed in one week the direct sale of 2.3million shares of stock, up from the 1.5 million shares itproposed selling Sept. 22, 1995.
The 2.3 million shares were sold exclusively toinstitutional investors at $9.38 apiece, resulting in netproceeds of $20.8 million. The Providence, R.I., companynow has about $45 million in cash and 15.1 millionshares outstanding. Its stock (NASDAQ:CTII) gained 13cents Monday, closing at $9.88.
Daniel Geffken, chief financial officer ofCytoTherapeutics, said company officials couldn't makethe time commitment for a 45-day road show to promotethe stock.
"We're in the middle of a fair number of partneringdiscussions," Geffken said. "We have to focus in ongetting deals done, and on getting good deals done.We've worked hard to maintain good relationships withpeople we know are interested in our story."
The company originally was going to sell 1 millionshares, he said. But one investor wanted 1.2 millionshares. Another two institutions combined to buy 800,000shares, with the rest going to three other institutions. Themutual fund companies purchasing the shares were notdisclosed.
Geffken said the company expects its burn rate to be at orunder $1 million per month for awhile, meaningCytoTherapeutics' cash could last well over three years.And that could be reduced if more partners are found.
"We're optimistic that in the next nine months, we'llhave several deals done," he said, pointing to the possibletarget areas of Parkinson's disease, amyotrophic lateralsclerosis and multiple sclerosis. The company'stechnology is designed to deliver therapeutics within theblood-brain barrier.
It's lead program, CereCRIB, is being developed withSweden-based Astra AB for the treatment of pain incancer patients. It is in Phase I studies in the U.S. andPhase I/II in Europe.
CytoTherapeutics already got $11 million from that deal.(See BioWorld Today, April 3, 1995, p. 1) And it raised$12.5 million in a self-managed private offering toinstitutions, bringing to about $44 million the amount thecompany has brought in this year.
CereCRIB is based on the company's cellularreplacement by immunoisolatory biocapsule (CRIB),which contains adrenal cells of newborn calves. It'simplanted at the base of the spine, where the bovine cellsrelease natural analgesics into the fluid space of the spinalcolumn. A single implant is expected to provide painrelief for up to a year.n
-- Jim Shrine
(c) 1997 American Health Consultants. All rights reserved.