Procept Inc. announced Friday it has filed for an initial publicoffering, in particular to finance clinical trials of a proposedAIDS virus therapeutic.

The Cambridge, Mass., company seeks to raise $21 millionthrough an offering of 1.8 million shares at $11 to $13 pershare. The offering is being managed by underwriters Kidder,Peabody & Co. Inc. and Tucker Anthony Inc.

Net proceeds will be used to fund research and productdevelopment, including preclinical studies and initial clinicaltrials, and for general corporate purposes.

Incorporated in 1985, Procept's activities are based on researchby Ellis Reinherz, who is in charge of immunobiology at theDana Farber Cancer Institute at Harvard Medical School.Reinherz has studied the role of the T cell receptor protein inregulating the immune system. Procept is pursuing the use ofsmall organic molecules to bind and inactivate the receptors.

In 1989, in collaboration with two Harvard researchers, whoidentified the three-dimensional structure of CD4 and CD2immune cell receptors, the company began using rational drugdesign to screen potential inhibitors, said Stan Erck, presidentand chief executive officer of Procept.

The company is in preclinical studies with an agent to blockbinding of the HIV virus to CD4, and plans to begin Phase I/IIclinical trials later this year.

Proceeds of the initial offering should finance research through1994, Erck said. The potential AIDS therapeutic is designed toinhibit T cell proliferation.

The company is focused on autoimmune disease, he added, andis looking at the role of both CD4 in inflammatory conditionsand CD2. In a long-term strategic partnership with Bristol-Myers Squibb Co., Erck said, Procept is developing drugs totreat autoimmune disorders based on T cell antigen receptors,as well as a treatment for insulin-dependent diabetes.

In a separate program, Procept is examining small organiccompounds to block a different region of the CD4 receptor inrheumatoid arthritis, and hopes to file an investigational newdrug (IND) application on that work in 1994, Erck said.

Using small organic molecules is appealing because they areeasy to synthesize, don't elicit antibodies in long-term use andmay be orally active, he continued. Erck said CD4 appears to bea good target because studies indicate that blocking the CD4receptor can block initiation or progression of autoimmunedisease in animals.

Procept, initially funded by Montgomery Medical Venturepartners and Venture Founders of Boston, now has a staff of 60and a 35,000-square-foot research space in Cambridge, he said.The initial public offering was originally put in motion lastspring, but was delayed because of an unfavorable investmentclimate. Procept instead raised $11 million in a privateplacement that closed Jan. 5, led by Harvard Management.

-- Nancy Garcia Associate Editor

(c) 1997 American Health Consultants. All rights reserved.

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