CollaGenex secures $45.5 million from stock sale; Dendreon prices $45 million offering

By Sheri Kasprzak

New York, Nov. 16 - Two biotech companies headed up PIPE news Thursday, both with registered direct placements of stock.

One sellsider said Thursday that direct placements become popular with biotech companies because they can negotiate a better pricing level.

"The discounts tend to be a little less than with an unregistered stock sale," he said.

Even so, one of the two biotech offerings announced Thursday was priced at a 14.6% discount to the current market price.

Leading those two offerings was a $45.5 million direct placement from CollaGenex Pharmaceuticals, Inc.

The company plans to issue 3.5 million shares at $13.00 apiece to a group of institutional and other investors on Nov. 21. The price per share is a 2% discount to the company's $13.31 closing stock price from Wednesday.

After the placement was announced Thursday morning, the stock climbed 18 cents, or 1.35%, to end at $13.49 (Nasdaq: CGPI).

The shares are being sold under the company's shelf registration.

Lazard Capital Markets LLC was the bookrunner.

Proceeds from the deal will be used for research and development expenses, manufacturing expenses, clinical trials, administrative expenses, potential acquisitions and working capital.

CollaGenex has tapped the PIPE market for funding before.

In December 2005, the company sold 2.9 million shares at $10.00 apiece for $29 million.

Newtown, Pa.-based CollaGenex develops therapies for acne, rosacea and other skin disorders.

Dendreon plans offering

The other biotech company to price a direct sale of its stock Thursday was Dendreon Corp., which plans to sell $45 million in shares at $4.55 each. The price per share is a 14.6% discount to the company's $5.33 closing stock price on Wednesday.

A group of institutional investors has agreed to buy 9,890,110 shares under the company's shelf registration.

News of the offering sent the company's stock diving by 11%, giving up 59 cents on the day to close at $4.76 (Nasdaq: DNDN). The stock rebounded slightly in after-hours activity, gaining 4 cents.

Credit Suisse Securities (USA) LLC and Lazard Capital Markets LLC are joint bookrunners for the deal.

The deal is set to close Nov. 21.

Dendreon has also completed private placements of its stock in the past. Also in December 2005, the company pocketed $51.75 million from the sale of 11.5 million shares at $4.50 each.

Seattle-based Dendreon develops novel therapeutics used to boost the immune system to fight cancer.

Applied Spectrum stock falls 7%

In secondary market news linked to the biotech sector, Applied Spectrum Technologies, Inc. watched its stock fall by more than 7% on Thursday after settling a $12,009,910 stock offering as part of its merger with Ever Leader Holdings Ltd.

The stock lost 5 cents, or 7.14%, to close at $0.65 (OTCBB: APSP) Thursday. On Wednesday, when the closing was announced, the stock remained unmoved at $0.70.

In the deal, a group of institutional investors bought shares at $0.4626 each, a 33.9% discount to the company's $0.70 closing stock price.

Under the merger terms, Applied issued 64,942,360 shares to holders of Ever Leader's stock in exchange for all of its outstanding shares. Once the merger is approved by shareholders, the amalgamated company's name will be changed to Benda Pharmaceuticals, Inc.

The merged company will develop pharmaceuticals, active pharmaceutical ingredients and traditional Chinese medicines to treat cancer, diabetes, the common cold and other diseases.

Benda will be based in Hubei Province, China.

Metabolix stock climbs on PIPE

Elsewhere, Metabolix, Inc. completed a $7.5 million private placement with Archer-Daniels-Midland Co., sending the company's stock soaring by more than 14% on the day.

ADM, an existing shareholder and one of the company's collaborative partners, bought 535,714 shares at $14.00 each. The price per share represents a 12.5% discount to the company's $16.00 closing stock price on Wednesday.

The company's stock jumped 14.06%, or $2.25, to end at $18.25 after the offering was announced (Nasdaq: MBLX).

The offering was priced at the same level as the company's recent initial public offering.

The company announced its IPO for 6.8 million shares on Nov. 10. Piper Jaffray & Co. is the bookrunner for the IPO and has a greenshoe for up to 1.02 million additional shares.

Cambridge, Mass.-based Metabolix develops alternatives to petrochemical-based plastics, fuels and chemicals.

Corgi to close PIPE

In other private placement news, Corgi International Ltd. announced late Thursday that it plans to seal a $17.6 million private placement of American Depositary Shares as part of its merger with Cards Inc.

The company plans to sell 16 million ADS at $1.10 each and warrants for another 4.8 million shares. The price per ADS is a 6.8% premium to the company's $1.03 closing stock price Wednesday.

Each warrant is exercisable at $1.30.

After the deal was announced Thursday evening, the stock remained unchanged at $1.03, but gave up 2 cents in after-hours trading (Nasdaq: CRGI).

Proceeds will be used to repay debt. The rest will be used for general corporate purposes.

Under the terms of the acquisition, Corgi will issue 7.2 million of its ADS to acquire all of Cards Inc.'s outstanding common stock.

Hong Kong-based Corgi sells die-cast collectibles.

Revett plans unit deal

Moving north of the border, Revett Minerals Inc. led Canadian resources offerings Thursday with the pricing of a C$12.995 million offering.

The deal includes up to 11.5 million units of one share and one quarter-share warrant at C$1.13 each. The whole warrants are exercisable at C$1.36 each for 30 months.

The deal is expected to close Nov. 22.

Strata Partners LLC was the lead agent for the deal.

Revett's stock remained unchanged Thursday to close at C$1.25 (Toronto: RVM).

Proceeds will be used for the advancement of the company's Rock Creek project.

Based in Spokane, Wash., Revett is a mineral exploration company focused on copper.

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