Oncology drug developer Biocancell Therapeutics Ltd. (TASE:BICL) will raise $3-4 million in a private placement from its current investors - Clal Biotechnology Industries Ltd. (TASE: CBI), which owns 14%, founder and chief scientist Prof. Avraham Hochberg, who owns 8%, and Tikcro Technologies Ltd. (Bulletin Board: TKCRF). Tikcro owns few shares, but does own convertible bonds, which if exercised, could turn it into a party at interest in the company.
Although Biocancell is traded on the TASE, it is incorporated in Delaware and is therefore subject to US Securities and Exchange Commission (SEC) regulations and US law. The company also announced that it plans to set up a new company in Israel and merge with it, which will greatly ease its regulatory relations.
Biocancell had NIS 6.6 million in cash at the end of September, and the capital injection should give it the wherewithal to survive for another 6-9 months, possibly until it obtains the results of its Phase IIb clinical trial (multicenter efficacy trial) of its most advanced drug candidate, BC-819 for the treatment of bladder cancer. The company needs $7-8 million to complete the trial.
The company said that, when completed, the fundraising will activate the adjustment mechanism set out in the 2008 allotment to Tikcro, Clal Biotech, and the Hebrew University of Jerusalem's severance fund. These investors own convertible bonds, exercisable at $0.07 per share, 85% above the current share price.
Biocancell's share price rose 0.1% today to NIS 1.39, giving a market cap of NIS 37 million.
Published by Globes [online], Israel business news - www.globes-online.com - on November 8, 2011
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