Oncothyreon Grabs $47M in Stock Offering
Seattle-based Oncothyreon has raised a lot more money to run clinical trials of its experimental cancer treatments.
The company (NASDAQ: ONTY) said today it has raised $47 million from an underwritten stock offering, in which it sold 11.75 million shares to investors at $4 apiece. The company could end up getting another $7.1 million if underwriters exercise their options to buy more shares over the next 30 days. The shares were sold at about an 8 percent discount to yesterday’s closing stock price of $4.35. Cowen & Co and Stifel, Nicolaus managed the offering while Cantor Fitzgerald, Rodman & Renshaw, and Wedbush PacGrow Life Sciences acted as financial advisors to Oncothyreon.
While Oncothyreon is best known for Stimuvax, a treatment designed to stimulate the immune system against cancer, the expenses for that program are shouldered by Oncothyreon’s partner, Germany-based Merck KGaA. The money raised today will go toward a couple of programs that are still wholly-owned by Oncothyreon—a cancer drug called PX-866 that’s made to block the PI3 kinase target and another immune-boosting treatment called ONT-10. The cancer drug is being run through a series of mid-stage clinical trials, while ONT-10 just entered its first clinical trial this month.
The new money will significantly strengthen the financial picture at Oncothyreon, which ran dangerously low on cash for a while during the recession in 2009. It bounced back to close 2011 with $66.4 million in cash and investments, and it has forecasted that it expects to spend about $30 million to $33 million of those reserves this year.