Cygnus Therapeutic Systems announced Friday that it hassuspended its 3 million-share follow-on stock offering just onemonth after it filed the registration statement with theSecurities and Exchange Commission (SEC).
The Redwood City, Calif., transdermal drug delivery companybased its decision on adverse market conditions. Nonetheless,its common stock (NASDAQ:CYGN) gained $1 a share on Fridayto close at $7. Its February 1991 initial public offering (IPO)price was $9 a share.
This is the second time the company has withdrawn a follow-on offering because it was displeased with the general financialmilieu. Cygnus planned to offer 3 million shares in March 1992,when the stock was trading at about $25, but postponed thesale about six weeks later when the stock dipped to about $16.It finally completed that offering in May 1992 by reducing thenumber of offered shares to 1.5 million; it grossed $22.5 millionat $15 per share.
Currently, Cygnus has about 13.8 million shares of commonstock outstanding, fully diluted, and roughly $31 million cashon hand, according to Craig Carlson, the company's vicepresident of corporate communications. "We went out into themarket well before we needed it. This just isn't the right timefor us," Carlson told BioWorld.
Cygnus' major product focus is patches for transdermaldelivery of nicotine in smoking cessation therapies. Thecompany is already marketing its first-generation product,Nicotrol, through Warner-Lambert in the U.S., and just lastmonth received regulatory approval to market the prescriptionproduct in Canada.
Cygnus has also developed a second-generation nicotine patch,to deliver multiple-dose strengths, and filed an investigationalnew drug (IND) application with the FDA on July 28.
-- Jennifer Van Brunt Senior Editor
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