Only a month after less-than-desired clinical data sent its stock price reeling, Cadence Pharmaceuticals Inc. said it plans to bounce back by raising up to $49.3 million in a registered direct common stock offering.

The company said it has received commitments from selected investors to purchase up to 9.24 million shares of the company's common stock at a purchase price of $5.34 per share. The closing of the offering is expected to take place on Feb. 20, 2008.

The total number of shares to be sold in the offering may be reduced to 8.05 million, and the gross proceeds may be reduced to $43 million, pending the determination of a Nasdaq rule, the San Diego-based company said.

The proceeds from the offering will be used to fund the company's clinical development, Anna Gralinska, director of investor relations at Cadence, told BioWorld Today. Cadence has two Phase III product candidates in development, Acetavance (intravenous acetaminophen) for the treatment of acute pain and fever, and Omigard (omiganan pentahydrochloride 1 percent topical gel) for the prevention of catheter- related infections.

It was data on Acetavance that sent the company's shares falling 61 percent. (See BioWorld Today, Jan. 14, 2008.) Results from Study 301, which evaluated Acetavance vs. placebo over 48 hours in postoperative pain following abdominal gynecologic surgery in 331 hospitalized patients, showed that the drug failed to statistically significantly reduce patients' pain intensity levels. Company executives at the time attributed the miss to a "substantially higher than predicted variability" in pain intensity scores.

If the new offering is successful, the company would have another year's worth of cash, said Adam Cutler, an analyst with Canaccord Adams Inc. Cadence already had enough cash in the bank for 2008, and with the successful closing of the offering, it could have enough money to carry it through 2009, Cutler said. At the end of 2007, Cadence had a year's worth of cash and cash equivalents, $56 million, Galinska said. The company plans to give a financial results update in early March, she said.

News of the financing nudged its shares (NASDAQ:CADX) up 7 cents to close at $5.41. Cutler said he believed the market "overreacted" to the negative news of Acetavance in January. The Acetavance results were an "unfortunate setback" due to "less-than-optimal study design," Cutler said. But he said the rest of the company's program should allow the drug to gain approval, with rapid uptake once it's on the market.

In other financing news:

• Icagen Inc., of Research Triangle Park, N.C., said it completed the sale of 5.8 million shares of common stock to New York-based Pfizer Inc. at a price of $1.71 per share. The gross receipts from the purchase agreement between the two companies resulted in about $10 million in gross proceeds to Icagen, the company said. The net proceeds from the private placement will be used to fund Icagen's research and development programs and general corporate purposes.

• Pro-Pharmaceuticals Inc., of Newton, Mass., said it has entered into definitive agreements with new and existing investors to raise $3.775 million though a registered direct offering. The company will sell 7.55 million shares of its common stock at $0.50 per share. The transaction is expected to close Feb. 20. The company plans to use the proceeds for working capital. As part of the transaction, the investors will receive warrants, with a five-year term, to purchase 7.55 million shares of common stock at an exercise price of $0.70. Investors also will receive warrants, with a term of four months, to purchase a total of 3.02 million of common stock with an exercise price of $0.67 per share. The warrants will not be exercisable until Aug. 16.

• Q Therapeutics Inc., of Salt Lake City, said it has closed on a first tranche of its $15 million Series B financing. The company plans to use the investment to accelerate efforts to bring new treatments to the clinic. Q is conducting preclinical studies to support the filing of an investigational new drug application with the FDA, using Q-Cells (neural glial cells) for the treatment of transverse myelitis, a rapidly paralyzing subset of multiple sclerosis (MS). Clinical trials are anticipated at Johns Hopkins in 2009. Also, Invitrogen Corp., of Carlsbad, Calif., said it has made a minority investment in Q Therapeutics. Details of the investment were not disclosed. Invitrogen is among the investors in Q Therapeutic's $15 million Series B financing.