BioWorld Today Contributing Writer

Clavis Pharma ASA raised $25.7 million in a private placement of 4.4 million new shares, at NOK35 per share (US$5.84), a sum that will carry the firm for two years.

ABG Sundial Collier ASA and Carnegie ASA led the placement jointly and acted as joint bookrunners. Existing and new investors participated in the placement, which was oversubscribed at the issue price.

Clavis CEO Olav Hellebo said the infusion will take the Oslo, Norway-based company's elacytarabine (CP-4055) through Phase III trials.

"We also want to get CP-4126 through Phase II," Hellebo told BioWorld Today.

Clavis is developing CP-4126 in partnership with Clovis Oncology Inc., of Boulder, Colo.

Other activities to be funded include preclinical proof of concept and early clinical development of CP-4200 and companion diagnostic development for hENT1 (human equilibrative nucleoside transporter 1) biomarkers.

Clavis is developing elacytarabine for acute myelogenous leukemia (AML) and began enrolling patients for a Phase III trial in June. According to the company, elacytarabine is a derivative of cytarabine that does not require transporter proteins to enter cancer cells.

Cytarabine is the current leading treatment for AML, and treatment failure is sometimes caused by deficient expression of those membrane proteins, especially hENT1, Clavis said.

In its Phase III CLAVELA study, Clavis will compare overall survival between patients treated with elacytarabine and a range of other treatments including cytarabine and combination regimes such as mitoxantrone/etoposide/cytarabine and fludarabine/cytarabine/G-CSF/idarubicin.

Clavis is also running a Phase II trial of elacytarabine in combination with idarubicin in AML patients who have failed their first course of treatment.

Tranche 1 of the placement, representing 2. 115 million new shares has already been approved by the company's board of directors, and will be tradable on Nov. 19. Tranche 2, of 2.285 million new shares, will be subject to approval by an extraordinary general meeting of Clavis Pharma which is planned for Dec. 9. Upon approval, shares of Tranche 2 will be transferred on Dec. 14.

At that meeting, the board will propose a new offering of up to 600,000 new shares.

The new financing activities closely follow a new $205 million partnership agreement with Clovis for CP-4126. Under the terms of that deal, which is an expansion of an existing relationship, Clovis will pay $10 million up front for global rights.

Clavis will be eligible for development milestones totaling $30 million and sales milestones up to $165 million, as well as royalties on all product sales.

Clovis had previously licensed rights to CP-4126 in North and South America and Europe in a deal worth $380 million. (See BioWorld Today, Nov. 12, 2010.)

In April, Clavis licensed its monoclonal antibody for hENT1 to Ventana Medical Systems Inc., along with a hybridoma cell line for production of the antibody. Ventana will develop a companion diagnostic for CP-4126, to identify patients with low hENT1 expression, on the theory that those patients will be good candidates for the drug.

Hellebo said the fundraising process went well, attributing the smooth sailing to a healthy Norwegian biotech sector and the fact that Clavis is a "relatively small company that is relatively advanced in clinical trials."

In other financing news:

• BioCancell Therapeutics Inc., of Jerusalem, auctioned up to 617,000 units of stock on Nov. 18. The units consisted of up to 6.17 million shares of common stock, par value 1 cent per share, 3.085 million Series 3 warrants, and 3.085 million Series 4 warrants. BioCancell stock (TASE:BICL) closed at 73 cents Thursday, down 12.2 percent, or 1 cent.

• A placement of 4 million shares of common stock by iBio Inc., of Newark, Del., was fully subscribed to the limit of the placement terms. The first closing of the placement was on Oct. 27. The placement is now complete at $7.4 million and will be formally closed. Each unit contained one share at $2 per share plus a warrant for another share at $2.20, good for five years. Financial Capital Markets acted as placement agent.

• Valeant Pharmaceuticals International Inc., of Mississauga, Ontario, said its wholly owned indirect subsidiary launched its offer of about $700 million aggregate principal amount of senior secured notes. Valeant intends to use the proceeds to repay its tranche B term loan facility under its crudities and for general corporate purposes, including acquisitions, debt repayment and share repurchases.