Cougar Biotechnology, Inc., a Los Angeles biotechnology company with three experimental cancer drugs, announced Monday it had gone public through a reverse merger and also completed a $47.5 million private placement.
Cougar merged with a wholly owned subsidiary of Century City-based SRKP 4 Inc., which according to regulatory filings was incorporated last May as a shell company whose business plan was to merge with an established company.
SRKP 4 was renamed Cougar Biotechnology, Inc. following the merger. Cougar officers and directors replaced all of the officers of SRKP 4; stockholders of the private company now hold 100 percent of the new company's equity in the same proportion as they owned of Cougar.
The private placement of approximately 27.5 million units of its securities to institutional and other accredited investors resulted in gross proceeds of $47.5 million, which includes the conversion of approximately $7.8 million of previously issued debt.
"One of Cougar's key objectives for the year was to raise sufficient capital to not only complete the early clinical testing of the company's drugs but also to be able to move forward with more advanced clinical development," said Dr. Arie Belldegrun, Cougar's board vice chairman, in a statement.
Adage Capital Management, L.P. was the lead investor in this financing, which also included significant participation from Brookside Capital, funds managed by T. Rowe Price Associates, Merlin Biomed Group, RA Capital Management, Tavistock Life Sciences as well as other health care institutional investors. Cowen & Co. LLC and Paramount BioCapital Inc. acted as co-placement agents for the placement.
Proceeds from the private placement will be used primarily to fund continued clinical development of Cougar's drug portfolio, which the company licensed from the original developers. One drug, CB7630, is in trials for prostate cancer. CB3304 is in trial for non-Hodgekin's lymphoma, and CB1089, an analog of vitamin D, is under study as a treatment for a form of prostate cancer.
The company hopes to have all three drugs in larger Phase 2 human trials by the end of the year, said Chief Executive Alan Auerbach during last month's SoCal Bio Investor Conference in Los Angeles.
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