NitroMed secures $19.76 million from stock offering; AtriCure pens $16.5 million deal

By Sheri Kasprzak

New York, May 24 - Biotech offerings continued to dominate PIPE headlines on Thursday, and by coincidence, all of the major offerings announced Thursday were from companies focused on cardiovascular health.

"I think it's a coincidence," said one market source familiar with the biotech sector. "It just happens that companies in this sector have a need for capital pretty often. It is kind of interesting that it happened that way."

Leading the slate of offerings was a $19.76 million registered direct deal from NitroMed, Inc.

The company penned an agreement with a group of institutional investors for 7.6 million shares at $2.60 each.

The share price is a 20.5% discount to the company's $3.27 closing stock price on Wednesday.

NitroMed's stock took a hit early in the day on word of the deal, losing 18.65%, or 62 cents, by 9:40 a.m. ET. The stock went on to lose 19.88%, or 65 cents, to end at $2.62 (Nasdaq: NTMD). The stock lost another 2 cents in after-hours trading.

The shares are being sold under the company's shelf registration through agent Thomas Weisel Partners LLC.

Proceeds will be used for sales, marketing and commercialization efforts for the company's BiDil (isosorbide dinitrate/hydralazine hydrochloride) product for heart failure and for the development of the company's extended-release version of the product designed to be taken once a day.

Lexington, Mass.-based NitroMed develops treatments for heart failure and other heart conditions.

AtriCure secures $16.5 million

In other heart-related news, AtriCure, Inc. is gearing up to settle a $16.5 million private placement.

A group of institutions plans to buy 1,789,649 shares. Of the shares, 1,683,060 will be sold at $9.15 each and the rest at $10.32 each to an affiliate.

The transaction is expected to close contingent upon certain conditions.

Proceeds will be used for research and development, potential acquisitions or other strategic initiatives, working capital and general corporate purposes.

Piper Jaffray & Co. was the placement agent.

The stock fell 80 cents, or 7.68%, to close at $9.62 (Nasdaq: ATRC) on Thursday.

Based in West Chester, Ohio, AtriCure is a medical device company focused on manufacturing surgical tools used in cardiothoracic surgery.

CardioVascular's $15 million deal

Elsewhere in the sector, CardioVascular BioTherapeutics Inc. announced an agreement with Swiss investment boutique FirmInvest AG to buy $15 million in stock at $1.00 per share.

"This financing from FirmInvest will give the company the opportunity and the funding necessary to complete the patient dosing of our phase 2 coronary heart disease clinical trial while continuing to advance our other clinical trials," said Thomas Stegmann, the company's chief medical officer, in a statement.

"I am optimistic that this phase 2 coronary heart disease clinical trial, which will include patients with end-stage coronary heart disease, will confirm the results of our previous clinical trials using our angiogenic protein therapy. Now that we have this private placement available and given the importance of phase 2 coronary heart disease trial to the valuation of our company, which is now at an all-time low, the company has decided to defer its London AIM listing until later in 2007."

The stock gave up a penny to end at $0.72 Thursday (OTCBB: CVBT).

Based in Las Vegas, CardioVascular BioTherapeutics is a biopharmaceutical company focused on treatments for coronary artery disease, dermal wounds in diabetics and peripheral artery disease.

IntelGenx stock jumps

In secondary market activity, IntelGenx Technologies Corp.'s stock climbed by 13.33% on Thursday after the company settled a private placement of convertible debentures for $1.5 million Wednesday.

The stock gained 10 cents to settle at $0.85 (OTCBB: IGXT). On Wednesday, the company's stock lost 5 cents, or 6.25%, to end at $0.75.

In the placement, the company issued 8% debentures that are convertible into common shares at $0.70 each.

Carter Securities LLC was the placement agent for the offering.

Located in Saint Laurent, Quebec, IntelGenx develops oral controlled-release products, including smoking cessation products.

Wave Systems deal

Moving to the tech sector, Wave Systems Corp. wrapped a $15 million offering.

The company sold 7,317,073 class A shares at $2.05 each.

Security Research Associates was the placement agent.

Proceeds will be used for ongoing operations.

On Thursday, the company's stock fell 3.1%, or 8 cents, to close at $2.50, losing another 11 cents in after-hours trading (Nasdaq: WAVX).

"We are pleased that Wave is making steady progress in working with leading PC industry partners and enterprise prospects in driving adoption of trusted computing solutions," said Steven Sprague, CEO of Wave, in a news release.

"We appreciate the continued support of our investors in funding Wave through these formative stages of the trusting computing marketplace."

Based in Lee, Mass., Wave develops data protection, advanced password management and authentication software.

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