Just one day after resubmission of its new drug application for lorcaserin, Arena Pharmaceuticals Inc. is selling nearly 10 million shares of common stock to raise $33 million, demonstrating that it is moving forward following the October 2010 complete response letter from the FDA.

The registered direct public offering consists of 9,953,250 shares of common stock at $1.65775 per share, and 9,953 shares of preferred stock at $1,657.75 per share. The buyers of the stock are affiliated with Deerfield Management, and the offering is expected to close on Jan. 13; 156,046,069 common shares will be outstanding upon completion of the offering.

The first $5 million of the proceeds will be used to pay off part of the principal in a loan from Deerfield that would otherwise be due in June 2013. The remainder will support the regulatory process for obesity candidate Lorqess (lorcaserin), as well as preclinical and clinical development of other pipeline products.

Concurrently, Deerfield will purchase 8.6 million shares of Arena common stock, in exchange for cancellation of warrants to purchase an aggregate of 13.6 million shares of Arena common stock. That group of warrants include warrants to purchase 11.8 million shares at $5.42 per share, and warrants to purchase 1.8 million shares at $3.45 per share. The new warrants will be exercisable at $1.745 through June 17, 2015.

The FDA said it rejected Arena's application because potential risks of tumors, psychiatric effects and heart problems outweighed any benefits of weight loss with lorcaserin. (See BioWorld Today, Sept. 17, 2010.)

Arena's response to the complete response letter includes data and analyses not present in the original NDA, particularly the results of the Phase III BLOOM-DM trial in patients with Type II diabetes. The new data address concerns about tumors from a study of lorcaserin carcinogenicity in rats, as well as cell culture studies on serotonin subtype 2 receptor activity.

The FDA accepted Arena's resubmission, and assigned a June 27 PDUFA date.

Arena, Vivus Inc. and Orexigen Therapeutics Inc. all experienced setbacks in 2010 related to registration of their respective obesity candidates, lorcaserin, Qnexa (phentermine/topiramate), and Contrave (naltrexone HCI/bupropion HCI).

As Arena moves forward with NDA resubmission and financing, Vivus has agreed with the FDA to apply for a more restrictive label in conjunction with a retrospective observational study for topiramate exposure in pregnancy, and Orexigen is hammering out a new clinical trial plan for Contrave. (See BioWorld Today, Sept. 22, 2011.)

In other financing news:

• Chelsea Therapeutics International Ltd., of Charlotte, N.C., completed an underwritten public offering of 4,989,275 shares of common stock at $4.75 per share. Underwriters exercised in full their overallotment option. Net proceeds were $22.1 million.