Titan Pharmaceuticals gets $25 million equity line; Stereotaxis secures $20.15 million from stock sale

By Sheri Kasprzak

New York, March 16 - Titan Pharmaceuticals, Inc. led a slate of biotech-related offerings to round out the week in PIPEs.

The company sealed a $25 million common stock equity financing with Azimuth Opportunity Ltd.

Azimuth agreed to buy shares of Titan over the next two years at discounts ranging from 4% to 7% of the then-current market price with a market price floor of $1.50.

News of the equity line comes just days after Titan announced the termination of its $35 million standby equity distribution agreement with Cornell Capital Partners, LP. That equity line had been obtained back in September 2005.

Titan's stock gained 4 cents on Friday to settle at $2.25 (Amex: TTP).

Proceeds will be used for development and general corporate purposes.

"We are pleased to enter into this agreement," said Louis Bucalo, the company's chief executive officer, in a statement released Friday. "This agreement provides flexibility to access additional equity capital at selected times when additional capital is desirable."

South San Francisco, Calif.-based Titan develops treatments for central nervous system disorders, cardiovascular disease, bone disease and other disorders.

Even though biotech companies were in the spotlight Friday, one sellside market source cautioned that investors may be taking a selective approach to the sector.

"Drug stocks these days are either pretty good or not so good, so I think investors will be picky," he said. "Of course that's not going to stop biotech companies that need money from getting into the market."

In the broader market, stocks continued to slip. The Dow Jones Industrial Average fell 49.27 to end at 12,110.41; the Nasdaq composite index dipped 6.04 to close at 2,372.66; and the Standard & Poor's 500 composite index gave up 5.33 to settle at 1,386.95.

Stereotaxis secures $20 million

In other news related to the biotech sector, Stereotaxis, Inc., a company that makes cardiology instrument control systems used in surgeries to treat arrhythmia and coronary artery disease, announced plans to close a $20,149,500 registered direct stock deal.

After the offering was announced Friday morning, the company's stock gained 50 cents, or 4.58%, to end at $11.42 but lost 2 cents in after-hours trading (Nasdaq: STXS).

A group of investors plans to buy 1.919 million shares at $10.50 each.

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

The non-brokered offering is expected to close March 19.

Stereotaxis is based in St. Louis.

Neuralstem raises $5.14 million

Elsewhere in the sector, Neuralstem Inc. completed a private placement of units for $5.135 million.

The company issued 2.054 million units of one share and one half-share warrant at $2.50 each to a group of institutional investors. The units consist of one share and one half-share warrant with each whole warrant exercisable at $3.00.

T.R. Winston and Co. was the placement agent.

Proceeds will be used for the company's anticipated first human trial and for working capital and general corporate purposes.

"We are pleased by the quality of institutional participation and view the placement as solidifying the company's balance sheet in preparation for a national exchange listing, as well as providing equity capital sufficient to fund our first human trials expected to begin during calendar 2007," said Neuralstem CEO Richard Garr in a news release.

Neuralstem's stock fell by a penny on Friday to close at $2.76 (OTCBB: NRLS).

Based in Rockville, Md., Neuralstem develops technologies to transplant human neural stem cells.

ATS to raise $16.25 million

Medical device company ATS Medical, Inc. plans to close a private placement for $16.25 million.

Institutional investors have agreed to purchase 8.125 million shares at $2.00 each and receive warrants for 3.25 million shares, exercisable at $2.40 each for five years

RBC Capital Markets was the placement agent.

On Friday, the company's stock gained 3 cents to close at $2.17 (Nasdaq: ATSI).

Proceeds will be used for working capital and general corporate purposes.

ATS visited the PIPE market back in October 2005, selling $22.4 million in 6% convertible notes. The notes, due Oct, 15, 2025, are convertible into common shares at $4.20 each, a 12% premium to the company's Oct. 6, 2005 closing stock price.

Minneapolis-based ATS develops medical devices used in cardiac surgery.

Datatrak secures $9.44 million

Elsewhere, Datatrak International, Inc. received agreements for a $9,435,029 private placement, which is set to close early in the March 19 week.

The company plans to sell 1,986,322 shares at $4.75 each.

The investors also will receive warrants for 297,948 shares, exercisable at $6.00 each for five years.

The stock fell 8 cents to end the week at $5.69 (Nasdaq: DATA).

Cleveland-based Datatrak develops software products used to accelerate clinical research data from investigative sites to clinical trial sponsors.

Tower Semiconductor stock climbs

Moving to secondary market action, Tower Semiconductor Ltd. saw its stock edge up on Friday, a day after the company announced plans to close a $28.95 million stock offering.

The stock gained 2 cents to end at $1.74 (Nasdaq: TSEM). On Thursday, when the deal was announced, the stock also gained 2 cents to close at $1.72.

In the placement, a group of U.S.-based institutional investors agreed to buy shares at $1.54 each, a 9.4% discount to the company's $1.70 closing stock price on Wednesday.

Citigroup Global Markets Inc. and C.E. Unterberg, Towbin, LLC were the placement agents.

Tower, based in Migdal Haemek, Israel, manufactures integrated circuits used in semiconductors.

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