DynaGen Inc. announced Wednesday that it has filed aregistration statement with the Securities and ExchangeCommission for a proposed public offering of 2 million sharesof series A convertible preferred stock priced at $10 per share.
The company (NASDAQ:DYGN) is seeking to raise $20 million inthe offering. DynaGen said dividends on the stock will bepayable quarterly at the rate of 9 percent per share perannum.
The underwriter for the offering is RAS Securities Corp., whichwill have an option to purchase an additional 300,000 shares ofseries A preferred stock to cover any overallotments.
DynaGen of Cambridge, Mass., has 14.7 million sharesoutstanding before the offering. As of Sept. 30, the companyhad $4 million in cash on hand. It raised $4.5 million earlierthis year through three private placements.
DynaGen's chairman and executive vice president, JayWadekar, said that the company's total burn rate from 1990 to1993 was $8 million, but he expects it to increase to about $1million per month with clinical trials of NicErase smoking-cessation drug.
Wadekar said money from the current stock offering would beused to conduct further NicErase trials and for scale-up of thedrug.
In August, DynaGen completed an initial Phase III trial ofNicErase-1A, an intramuscular injectable formulation of L-lobeline sulfate, as a therapy to reduce nicotine withdrawalsymptoms. The company also has completed Phase II trialswith a controlled-release formulation, and on Wednesdayannounced that it is preparing to file an investigational newdrug (IND) application for a sublingual tablet formulation.
DynaGen also is developing a one-hour antibody test todiagnose active tuberculosis. Studies with the assay,trademarked Microdot, have shown it to have 80 percentsensitivity and 90 percent specificity (see BioWorld, May 19).
DynaGen's stock closed at $3.25 a share on Wednesday, down25 cents.
-- Brenda Sandburg News Editor
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