Boston Life Sciences' stock up as phase 3 trial ends early; BioMarin's stock dips on follow-on stock deal

By Sheri Kasprzak

New York, March 20 - Boston Life Sciences, Inc.'s stock got a boost Monday as the company notified the Food and Drug Administration of its plans to take a step back from its Altropane product, ending its phase 3 trial earlier than expected.

The news sent the company's stock through the roof, with Boston Life Sciences' shares gaining 80 cents, or 35.24%, to close the day at $3.07 (Nasdaq: BLSI). The volume of shares traded Monday also jumped, climbing to 221,457 shares traded compared with the average 16,670 shares.

Altropane is the company's molecular imaging agent used to detect Parkinson's disease.

"Based on the previous performance of Altropane and [Boston Life Sciences'] monitoring of non-blinded data from the approximately 200 patients enrolled in the POET-1 trial to date, the company believes it may have already enrolled enough subjects in the trial to evaluate the efficacy of Altropane single photon emission computed tomography imaging in the differentiation of Parkinsonian Syndrome tremors from non-Parkinsonian or Essential tremors," said a statement released by Boston Life Sciences Monday afternoon.

"Our goal with the POET-1 trial was to assess whether Altropane imaging is more effective than the subjective methods used by general practitioners and internists to distinguish between tremors caused by Parkinsonian Syndrome and those associated with other disorders, as judged by comparison to the gold standard diagnosis by a movement disorder specialist," said Mark Pykett, Boston Life Sciences' chief operating officer, in the statement. "We based our original plan for enrolling 332 subjects largely because published reports in scientific journals indicated a 20% to 30% misdiagnosis rate in the early stages of Parkinson's disease."

Mark Hurtt, the company's chief medical officer, said the results of the analysis on the findings will be released in the third quarter of 2006.

Located in Hopkinton, Mass., Boston Life Sciences develops therapeutic and diagnostic products for the central nervous system.

BioMarin stock sinks on follow-on deal

BioMarin Corp.'s stock fell Monday after the company announced the pricing of a follow-on offering of 9 million common shares from its shelf registration.

The follow-on is scheduled to price Thursday.

The deal sent the stock down 43 cents, or 2.98%, to end at $14.00 (Nasdaq: BMRN).

The offering includes a 15% over-allotment option of 1.35 million shares.

Merrill Lynch & Co. is bookrunner for the deal with S.G. Cowen & Co., Leerink Swann & Co., Pacific Growth Equities, LLC and Rodman & Renshaw LLC as co-managers.

Connected to the follow-on deal, BioMarin is conducting a $125 million convertible note offering with a greenshoe for $18.75 million. The notes due 2013 were talked Monday to yield 2.5% to 3.0% with an initial conversion premium of 22.5% to 27.5%.

BioMarin, based in Novato, Calif., develops enzyme-based therapies to treat genetic disorders.

Biosite, Eli Lilly up on collaboration

Eli Lilly & Co. and Biosite Inc. both saw slight gains in their stock Monday after the two announced a collaboration agreement for a clinical trial on Lilly's sepsis drug Xigris.

Lilly's stock gained 33 cents, or 0.58%, to close at $57.42 (NYSE: LLY), gaining another 0.66% in after-hours activity. Biosite's stock gained 1.39%, or 70 cents, to end at $50.91 (Nasdaq: BSTE).

The trial will investigate, according to a news release, the use of Protein C, a biomarker, in connection with the administration of Xigris.

"We are very excited about this collaboration," said John Lechleiter, Lilly's chief operating officer, in the release. "Physicians have told us they want an on-demand diagnostic that better identifies patients who might benefit from Xigris, helps monitor the patient's response and allows tailored treatment."

Biosite, based in San Diego, develops diagnostic products, and Eli Lilly, based in Indianapolis, develops diagnostic and therapeutic drugs.

Spectrum stock rises

On word that it will be acquiring Targent Inc.'s cancer drug assets, Spectrum Pharmaceuticals Inc. edged up Monday

By noon ET, Spectrum's stock had advanced 3.54%, eventually gaining 1.77%, or 9 cents, to end the day at $5.17 (Nasdaq: SPPI).

Volume of the company's stock also rose substantially with 500,669 shares traded, compared with 188,102 shares traded on average over the last three months.

"We like [Spectrum]," said one buyside market source. "This looks like a good move for them and we think it's a good company to watch."

Under the terms of the asset purchase, Spectrum will buy North American rights to Targent's cancer assets for 600,000 common shares, translating to about $6.5 million. Targent may also receive up to 650,000 shares if certain sales and regulatory milestones are achieved for its lead cancer drug levofolinic acid.

Irvine, Calif.-based Spectrum develops cancer-fighting drugs.

XTL raises $28.02 million in ADR sale

XTL Biopharmaceuticals Ltd. wrapped a $28.02 million private placement Thursday of American Depositary Receipts.

The private biopharmaceutical company issued 4.67 million ADRs at $6.00 each. The ADRs are exchangeable for a total of 46.67 million common shares. The investors in the offering also received warrants for one half-share for every common share purchased in the deal, exercisable at $0.875 each per share or $8.75 per ADR. The warrants expire in five years. There will be a total of 23,335,000 warrants issued.

JPMorgan Securities Inc. was the bookrunner.

Proceeds from the deal will be used to develop the company's pipeline of hepatitis C drug candidates.

"We are very pleased to have consummated this financing with some of the highest-quality investors in the biotechnology sector in the U.S.," said Ron Bentsur, the company's chief executive officer, in a statement. "We believe that this serves as a strong validation of the promise of our hepatitis C clinical-stage drug pipeline and the company.

"Following this offering, we will have sufficient cash to take us into 2008. The funds raised will not only provide us with capital to support our current and planned clinical programs for our hepatitis C drug candidates, but will also provide us with added flexibility in our in-licensing and product acquisition program, as well aim to build out our pipeline with additional clinical-stage drug candidates."

Located in New York, XTL develops and commercializes therapies for hepatitis C.

Sunesis stock drops

A day after announcing a $45 million PIPE, Sunesis Pharmaceuticals Inc.'s stock dropped Monday.

The stock fell 22 cents, or 3.17%, to end at $6.71 (Nasdaq: SNSS) Monday after gaining 11.41% on Friday.

Volume of the shares of Sunesis traded on Monday, however, climbed even more with 142,512 shares traded compared with the three-month running average of 22,665 shares. On Friday, 101,530 shares were traded.

Under the terms of the placement, Sunesis plans to sell shares at $6.20 each to a group of investors including Alta Partners, Deerfield Management, Baker Brothers Investments and Warburg Pincus LLC.

Proceeds from the deal will be used for clinical development on the company's oncology products, including phase 2 clinical trails on its non-small cell and small-cell lung and ovarian cancer treatments and phase 1 and 2 clinical trails on SNS-595 to treat acute leukemia. The company will also use the proceeds on a phase 1 and 2 clinical trial in advanced solid tumors and a phase 1 trial in B-cell malignancies with its SNS-032 compound.

San Francisco-based Sunesis develops small molecule therapeutics for cancer and other diseases.

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