As it prepares for the readouts from a handful of clinical trials in the second half of the year, rare disease developer BioMarin Pharmaceutical Inc. turned to the markets to seek $248.8 million from an underwritten public offering of 6.5 million shares of common stock.

The company granted underwriters a 30-day option to purchase up to an additional 650,000 shares, potentially generating another $24.9 million based on Wednesday's closing price of $38.29. A day earlier, BioMarin's shares (NASDAQ:BMRN) hit a 52-week high of $39.29 before settling back to close at $39.06.

The Novato, Calif.-based company did not cite a share price for the offering. BofA Merrill Lynch and Barclays are acting as joint book-running managers and will offer the shares at fixed or prevailing market prices through the Nasdaq Global Select Market, the over-the-counter market, negotiated transactions or other means.

The offering is expected to close on or about June 5.

The company's shelf registration and prospectus, both filed May 30, were vague about the use of proceeds, suggesting the timing was influenced more by the stock's price than by imminent inflection points.

BioMarin has been a model of consistency, with its stock trending upward over the past year and consistently closing above $30 since last fall even after the company reported a GAAP net loss was $24 million (21 cents per diluted share) for the first quarter of 2012 compared to a GAAP net loss of $4.4 million (4 cents per diluted share) for the same period last year.

The market shrugged off that news, thanks to several upsides for the company. The first was a growing revenue stream, which for the first time surpassed $100 million in quarterly revenues for BioMarin-marketed products. They include the phenylketonuria drug Kuvan (sapropterin dihydrochloride), whose sales reached $32 million in the first quarter, and the mucopolysaccharidoses enzyme replacement therapies (ERTs) Naglazyme (galsulfase) and Aldurazyme (laronidase), whose sales totaled $68.6 million and $12 million, respectively. BioMarin also has Firdapse (amifampridine), which was approved by the European Commission and has orphan drug designation from the FDA in the rare autoimmune disease Lambert-Eaton myasthenic syndrome.

But the key driver of BioMarin's future growth could come from GALNS (N-acetylgalactosamine 6-sulfatase), an ERT currently in a pivotal Phase III trial in mucopolysaccharidosis Type IVA (MPS IVA), a lysosomal storage disorder, also known as Morquio A syndrome, characterized by excessive storage of karatan sulfate. The condition can lead to systemic skeletal dysplasia, short stature and joint abnormalities. (See BioWorld Today, Feb. 2, 2011.)

"The most important event for BioMarin – and one of the key events for all of biotech in 2H, in our view – is pivotal Phase 3 GALNS data in patients with Morquio Syndrome," J.P. Morgan analyst Cory Kasimov wrote in a research note last week following a meeting with BioMarin CEO Jean-Jacques Bienaimè.

"The last patient out will be sometime in September, so they hope to have data pre-Thanksgiving," Kasimov added. "We thought management sounded very confident."

No therapies are available for MPS IVA, a condition believed to affect between 1 in 200,000 and 1 in 250,000 live births, or about 2,500 to 3,500 patients worldwide.

BioMarin is testing two doses of GALNS – 2 mg/kg per week and 2 mg/kg every other week – over a six-month period.

The primary endpoint will be the six-minute walk test, while secondary endpoints will evaluate the three-minute stair climb test and urine keratin sulfate concentration.

The company used the same endurance endpoints in an earlier Phase I/II trial testing GALNS (also known as BMN 110). Data from that trial wowed investors. (See BioWorld Today, Feb. 8, 2010.)

In a note published last month following the release of the company's first-quarter earnings, Ian Somaiya, senior research analyst at Piper Jaffray & Co., was equally bullish.

"BioMarin is the best positioned mid-cap biotech in our coverage universe with three positive clinical catalysts" expected in the second half of 2012, he wrote. "We expect positive Phase III data in GALNS in [the fourth quarter] to support [roughly] $750 million in peak sales and drive 28 percent revenue growth between 2012-2015."

If the Phase III study replicates earlier results, the company has said a new drug filing will come next year.

Behind the GALNS program, BioMarin has PEG-PAL, a pegylated recombinant phenylalanine ammonia lyase scheduled to report data in the third quarter from a Phase IIb trial in phenylketonuria patients with severe disease.

And the company is conducting Phase I/II trials of BMN 701, a fusion protein of insulin-like growth factor 2 and acid alpha glucosidase, in Pompe disease and testing BMN 673, a poly ADP-ribose polymerase inhibitor for genetically defined cancers. BMN 701 was acquired through a buyout of Zystor Therapeutics Inc., while BioMarin picked up rights to BMN 673 in its acquisition of Lead Therapeutics Inc. (See BioWorld Today, Feb. 8, 2010, and Aug. 19, 2010.)

The Phase I BMN 701 data are scheduled to report in the fourth quarter.

All told, BioMarin could generate $2 billion to $3 billion in annual sales before the end of the decade, Somaiya predicted.

The latest offering would nearly double BioMarin's cash on hand. The company reported cash, equivalents and short- and long-term investments of $287.7 million as of March 31.

In the SEC filings, BioMarin reported 116.5 million shares of common stock outstanding as of May 28.

On Thursday, the company's shares fell $2.65, closing at $35.64.

In other financings news:

• Delcath Systems Inc., of New York, said it closed its public offering of 15.3 million shares of common stock and warrants to purchase up to 4.6 million shares at a combined price of $1 .50 per share and related warrants. Gross proceeds of about $23 million will be used for general corporate purposes, including commercialization of the company's products, obtaining regulatory approvals, funding clinical trials and research and supporting capital expenditures and working capital. Cowen and Co. LLC and Wedbush PacGrow Life Sciences acted as joint bookrunners and Roth Capital Partners served as co-manager.

• Lorus Therapeutics Inc., of Toronto, said it increased, subject to shareholder approval, the number of units expected to be issued in its proposed private placement to a maximum of 20.6 million units, priced at C32 cents (US31 cents) apiece, for gross proceeds of up to C$6.6 million. Each unit will consist of one common share and one common share purchase warrant. Proceeds will be used to continue development of research programs and for general and administrative purposes.