Amarin to settle $26.36 million PIPE; Inovio secures agreements for $15.8 million stock deal

By Sheri Kasprzak

New York, Dec. 19 - Amarin Corp. plc led a noticeably lighter PIPE market to kick off the week before the holidays.

The company is gearing up to sell 26.1 million American Depositary Shares to institutional investors at $1.01 each. The offering comes with warrants for 9.1 million ADSs, exercisable at $1.43 each.

Proceeds will be used to help fund phase 3 clinical trials on the company's product to treat Huntington's disease.

"We greatly appreciate the support shown by our long-term shareholders and welcome the addition of several sophisticated biotech shareholders to our investor base," said Rick Stewart, the company's chief executive officer, in a statement released Monday morning. "This successful financing enables us to complete the U.S. and European Huntington's disease phase 3 trials currently in progress on our lead product Miraxion, which are due to complete in late 2006 or early 2007.

"We now look forward to negotiating the partnering of a number of our other drug development programs, including Miraxion for depression, from a position of financial strength."

According to the company's chief financial officer, Alan Cooke, the offering brings the company's cash position to $33 million with no debt.

"Amarin is now forecast to have sufficient cash into mid-2007 and, with revenue from our partnership activities next year, potentially beyond," Cooke said in the company's statement.

The company's stock fell 8.55%, or 10 cents, to close at $1.07 on Monday.

In the company's latest earnings statement, it reported a net loss of $4.6 million for the quarter ended Sept. 30 compared with a net loss of $1.2 million for the same quarter of 2004.

London-based Amarin is a biopharmaceutical company focused on developing treatments for central nervous system disorders.

After announcing its $15.8 million offering Monday morning, Inovio's stock gained 5.96%, or 14 cents, to end at $2.49.

The company entered into agreements with a group of investors, including Merck & Co., to sell 6,583,333 shares at $2.40 apiece.

As of Oct. 31, the company had 19,509,454 outstanding common shares.

The investors will also get warrants equal to 35% of the shares issued in the offering. The warrants are exercisable for five years at $2.93 each, a 25% premium to the company's closing stock price of $2.35 on Dec. 15.

Proceeds will be used for clinical trials on the company's lead product, as well as for working capital and general corporate purposes.

For the quarter ended Sept. 30, Inovio reported a net loss of $2,990,799. For the same quarter ended Sept. 30, 2004, the company reported a net loss of $3,431,750.

Based in San Diego, Inovio is biotechnology company focused on the commercialization of cancer therapies.

Oil prices slip, stocks close down

Moving to the broader PIPE market Monday, volume fell from heavy levels seen over the past two weeks.

One sellside source said the reduced volume could have several causes.

"Most of what was going to price has pretty much already been priced," he said. "Most [issuers] were interested in pricing things to close before the end of the year and at this point it's a little late to settle things up by then."

He also said lower stocks may have caused some issuers to hold off.

The Dow Jones Industrial Average fell 39.06 to close at 10,836.53; the Nasdaq composite index slipped 29.74 to end at 2,222.74 and the Standard & Poor's 500 composite index lost 7.40 to settle at 1,259.92.

Oil prices also fell on Monday, losing $0.72 to close at $57.34 per barrel.

Norsemont prices C$10.01 million deal

Among Canadian issuers, Norsemont Mining Inc. arranged a C$10,012,500 private placement of 2,225,000 units at C$4.50 each.

The units are comprised of one share and one warrant. The warrants are exercisable for two years at C$5.00 each.

After the deal was announced Monday, the company's stock gained 17.61%, or C$0.59, to end at C$3.94.

Proceeds will be used for work programs on the Constancia and Amata projects, for the investigation of asset acquisitions and for general working capital.

Vancouver, B.C.-based Norsemont is a mineral exploration company.

Elsewhere in the mineral exploration sector, Sherwood Copper Corp. priced a C$1.31 million offering of flow-through shares and units of one share and one half-share warrant on a non-brokered basis. The full warrants are exercisable at C$1.50 each for one year.

Sherwood expects the deal to close before the end of 2005.

Proceeds will be used to fund the company's 2006 drilling program, including a feasibility study on the Minto gold property to be conducted through Hatch Ltd.

"This financing has been kept to a minimum to reduce dilution, but it will allow us to fund an additional drill program prior to completion of the feasibility study on the high-grade Minto copper-gold project," chief executive officer Stephen Quinn said in a statement. "Our 2005 drilling indicates that there is excellent potential for significantly higher gold grades than previously estimated for the Minto deposit, which increase we can demonstrate in the approximately two-thirds of the deposit drilled by Sherwood to date.

"Through this new drill program, we aim to demonstrate the same potential for the remainder of the deposit so that the potentially higher gold grades can be included in the feasibility study across the entire deposit. Recovered, payable gold credits could potentially cover a significant portion of future operating costs."

Based in Vancouver, B.C., Sherwood is a mineral exploration company focused on gold and copper.

The company's stock dipped 3 cents, or 2.4%, to close at C$1.22 Monday.

Semitool stock dips slightly

Semitool, Inc. saw its stock slip a touch on Monday after announcing the impending settlement of a $29.55 million direct placement of stock late last week.

The company's stock fell 2 cents on Monday to end at $10.23 after losing 15 cents on Friday.

The offering was announced late Thursday.

Semitool intends to sell shares under its shelf registration at $9.85 each to a group of institutional investors on Dec. 21.

Based in Kalispell, Mont., Semitool develops chemical processing equipment used in the production of semiconductors.

Avanir stock closes down

Avanir Pharmaceuticals, Inc.'s stock dropped 2% on Monday after announcing a $20.1 million direct offering.

The company's stock closed down 7 cents to end at $3.42. On Friday, when the deal was announced, the company's stock gained 8 cents, or 2.35%, to end at $3.49.

Avanir intends to sell stock to a group of institutional investors on Dec. 21 at $3.35 per share.

The shares will be sold under the company's shelf registration.

San Diego-based Avanir is a biopharmaceutical company focused on treatments for chronic diseases.

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