Novavax raises $18 million in direct offering; Nymox grosses $13 million from stock deal

By Sheri Kasprzak

New York, Nov. 2 - In a PIPE market heavy with biotech offerings, Novavax Inc. led news with an $18 million stock sale.

However, the company, which is developing an avian flu vaccine, saw its stock dip after the direct placement was announced early Wednesday.

After losing 7.25%, or $0.33, in pre-market trading, Novavax stock proceeded to fall 12.31%, or $0.56, to close out the day at $3.99.

A market source who saw the offering said it could have been priced higher but refused to say any more on the deal.

Cranshire Capital LP, Iroquois Master Fund Ltd. and Omicron Master Trust have agreed to buy 4,186,047 shares in the direct offering at $4.30 each.

As of July 29, the company had 43,553,876 outstanding common shares.

The shares are being sold under Novavax's shelf registration.

Rodman & Renshaw, LLC was the placement agent.

In addition to the development of its avian flu vaccine, Novavax plans to use the proceeds from the offering for internal research and development programs, the expansion of the company's research and development facilities and other general corporate purposes.

In its most recent earnings report, Novavax posted a net loss of $5,716,000 for the quarter ended June 30, compared to a net loss of $7,717,000 for the same quarter of 2004.

Malvern, Pa.-based Novavax develops drug delivery and biological technologies.

Elsewhere in biotechnology, Nymox Pharmaceutical Corp. entered into definitive agreements for a $13 million stock deal priced at a 3% discount to the market.

The full details of the offering could not be determined by press time Wednesday, and repeated calls to chief financial officer Roy Wolvin were not returned by Wednesday night.

After the deal was announced early Wednesday afternoon, the company's stock slipped 8.8%, or $0.19, to close at $1.97.

"This new round of financing allows Nymox to continue to advance our products in development to market while maintaining our low burn rate, zero long-term debt and minimum dilution to our shareholders," said company chief executive officer Paul Averback in a statement. "Our dilution rate - a few percent per year on average - is among the very best in the industry."

Proceeds from the deal will be used for general corporate purposes.

Nymox has looked to the PIPE market before for capital to fund its research. In 2004, the company sold 1,080,462 shares for proceeds of $3.67 million.

As to its earnings, Nymox reported a net loss of $3,770,545 for the year ended Dec. 31, 2004, compared to a net loss of $4,395,428 for the same period ended Dec. 31, 2003.

Based in Hasbrouck Heights, N.J., Nymox develops treatments for E. coli infection, Alzheimer's disease, cancer and infectious diseases.

HemoSense raises $10 million

Looking elsewhere in the biotech sector, HemoSense, Inc. said it is gearing up to wrap a $10 million unit offering in the latter part of this week.

The company will sell 1,481,481 units at $6.75 each to a group of institutional investors by Nov. 4.

The units are comprised of one share and one half-share warrant. The whole warrants allow for the purchase of another share at C$8.165 each.

Based in San Jose, Calif., HemoSense develops technologies used to monitor blood coagulation to stop potential clots.

After the offering was announced Wednesday morning, the company's stock gained $0.50, or 7.14%, to end at $7.50.

Lower oil, higher stocks boost PIPE volume

In the broader market on Wednesday, sellside sources said a dip in oil prices and improved stocks helped fuel private placement volume.

"Things are looking much brighter," noted one market source. "Stocks seem to be moving up, which is always a good thing for us. Everyone's eyeing oil right now to see what will happen next, but I think that's going to be the case for a while now."

Oil prices slipped $0.10 on the day to end at $59.75 per barrel while the Dow Jones Industrial Average gained 65.96 to end at 10,472.73. The Nasdaq composite index advanced 30.26 to settle at 2,144.31, and the Standard & Poor's 500 composite index moved up 12 to close at 1,214.76.

Tiomin heads up Canadian deals

Among Canadian issuers, Tiomin Resources Inc. priced a C$6 million unit offering to fund exploration on one of its titanium mineral sands projects.

The Toronto-based uranium explorer intends to sell 15 million units at C$0.40 apiece. The units include one share and one half-share warrant. The whole warrants are exercisable at C$0.50 each for 18 months. For each unit purchased, the investors will also receive a bonus warrant, exercisable at C$0.50 each for 18 months.

A syndicate of placement agents led by Paradigm Capital Inc. has an over-allotment option for up to 6.25 million additional units.

The offering is expected to close by Nov. 29.

Proceeds will be used for activities on the Kwale titanium mineral sands project in Kenya. The rest will be used for general corporate purposes.

The company's stock remained unchanged at C$0.41 Wednesday.

Another mineral exploration company, MetalCorp Ltd. out of Thunder Bay, Ont., priced a C$2 million offering on Wednesday.

MetalCorp plans to sell up to 3.75 million flow-through shares at C$0.40 each and up to 1.25 million units at C$0.40 each.

The units include one share and one warrant. The warrants are exercisable at C$0.50 each for 18 months.

Research Capital Corp. is the placement agent and has an over-allotment option for up to 2.5 million additional flow-through shares.

Proceeds from the offering, which is slated to close on Nov. 23, will be used for working capital and general corporate purposes. Proceeds from the flow-through shares will be used for exploration on the company's Canadian properties.

The company's stock closed unchanged at C$0.3653 Wednesday.

On Track stock slips 1.7%

On Track Innovations Ltd.'s stock took a slight dip on Wednesday, losing 1.68% following a $22,210,515 private placement that wrapped on Tuesday.

The company's stock ended down $0.23 at $13.42 Wednesday.

On Tuesday, after the private placement was settled, the Fort Lee, N.J.-based company's stock gained 4.52%, or $0.59, to end at $13.65.

Through bookrunner RBC Capital Markets Inc., On Track sold units at $12.15 each to institutional investors in the United States, England and Switzerland.

On Track makes microprocessor-based smart cards used for payment systems, homeland security, electronic passports and other services.

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