Steering clear of the turbulent initial public offering (IPO)waters, Transkaryotic Therapies Inc. (TKT) said Tuesday that ithas raised $8.1 million in private placement of convertiblepreferred shares.
In July, TKT filed a registration statement with the Securitiesand Exchange Commission (SEC) for an IPO of 2.5 million sharesof common stock, but postponed the offering the followingmonth. The company intended to price the shares between $9and $11 and hoped to raise $22.5 million to $27.5 million. TKT'spresident and chief executive officer, Michael Forrest, said theIPO is still on file with the SEC, and the company mayreactivate it if market conditions become favorable.
Participating in the financing were Warburg Pincus Capital Co.LP, BEA Associates, H&Q Health Care Investors, H&Q LifeSciences Investors, Medical Portfolio Management, andAlejandro Zaffaroni, co-chairman and founder of Alza Corp.
TKT of Cambridge, Mass., raised $4 million in its last privateplacement in April. The current placement will bring thecompany's cash on hand up to $10 million. With a burn rate ofabout $700,000 per month, the funding should carry TKTthrough next year.
The gene therapy company expects to file its firstinvestigational new drug (IND) application before the end ofthe year for a Phase I study of human growth hormone (hGH)delivery to cancer patients suffering from cachexia (musclewasting). Forrest said that following this trial, future studieswould either pursue hGH gene therapy for treatment ofcachexia or short stature.
TKT is utilizing gene therapy technology that does not requirethe use of retroviruses or other infectious agents for insertionof genes into cells. In its initial trials, the company is usingelectroporation, which TKT believes has the greatest potential.It involves taking target cells, mixing them with thetherapeutic gene and exposing the mixture to a brief electricalshock. Forrest said the shock integrates the DNA of the geneinto each cell.
The company also anticipates filing an IND in 1994 for a factorIX gene therapy product for hemophilia B. Also in developmentare programs for delivery of factor VIII for hemophilia A anderythropoietin for chronic anemia.
-- Brenda Sandburg News Editor
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