In its second private placement this year, Cougar Biotechnology Inc. raised gross proceeds of $87 million to support its cancer clinical trials.

The Los Angeles-based company didn't exactly need the money. At the end of the third quarter, Cougar reported $61.7 million in cash, equivalents and marketable securities, much of which stemmed from a $50 million private placement completed in May. With a burn rate averaging just $5 million to $6 million per quarter, the company had plenty of runway. (See BioWorld Today, May 4, 2007.)

Yet Cougar President and CEO Alan Auerbach said there were "a number of institutions interested in taking large positions in the company," prompting Cougar to offer 3 million shares of common stock for $29 each, a slight discount to Friday's closing price of $29.76.

Shares of Cougar (NASDAQ:CGRB) rose 74 cents to close at $30.50 on Monday. The company transferred its stock listing from the Over-the-Counter Bulletin Board to the Nasdaq earlier this month. The OTC listing had been a remnant of Cougar's reverse merger with the nonoperating public shell SRKP 4 Inc. (See BioWorld Today, April 10, 2006.)

The money in Cougar's well-padded coffers will support ongoing clinical development of its three oncology drug candidates.

Farthest along is CB7630 (abiraterone acetate), an oral inhibitor of the steroidal enzyme 17alpha-hydroxylase/C17,20 lyase, which is involved in testosterone production. Cougar is conducting four Phase II trials of the drug: two in hormone-refractory, chemotherapy-naïve prostate cancer; one testing the drug alone in hormone-refractory, chemotherapy-refractory prostate cancer; and one in combination with prednisone in hormone-refractory, chemotherapy-refractory prostate cancer.

Metastatic prostate cancer patients typically receive initial treatment with hormones and later progress to chemotherapy. Two alternative treatment options in late-stage development recently suffered setbacks: the third-generation chemotherapy product satraplatin (GPC Biotech Inc., Pharmion Corp., and Spectrum Pharmaceuticals Inc.) failed a Phase III trial, and another Phase III trial of the high-dose vitamin D product Asentar (Novacea Inc. and Schering-Plough Corp.) was discontinued due to patient deaths. (See BioWorld Today, Nov. 1, 2007 and Nov. 6, 2007.)

On the positive side, Ferring Pharmaceuticals recently obtained positive Phase III data with its gonadotropin-releasing hormone (GnRH)-blocker degarelix for prostate cancer, and Algeta ASA's alpha emitter Alpharadin improved overall survival in a Phase II prostate cancer trial.

Three-month interim data from the Phase II trial of Cougar's CB7630 alone in hormone-refractory, chemotherapy-refractory prostate cancer showed that 14 of 28 patients achieved greater than 50 percent decreases in prostate-specific antigen (PSA) levels, while five patients achieved PSA decreases of 90 percent or more. Median time to progression was 23.9 weeks, and four of the 18 patients with measurable tumor lesions experienced confirmed partial radiological responses.

Auerbach said Cougar plans to begin a Phase III program with CB7630 in the first half of 2008. As to whether or not that program will be conducted with a partner, Auerbach said the company has not yet decided whether to go it alone, sign a partnership, or be acquired.

Behind CB7630 are CB3304 (noscapine) for hematological malignancies and CB1089 (seocalcitol) for solid tumors. CB3304, an oral alkaloid derived from opium that has been shown to inhibit microtubule dynamics, is slated to begin a Phase I trial in multiple myeloma this quarter. CB1089, a synthetic analog of vitamin D, will follow into Phase I in 2008.

The private placement is expected to close later this week. Leerink Swann LLC served as lead placement agent, with Cowen and Co. LLC and Lazard Frères & Co. LLC acting as co-placement agents.

In other financing news:

Helix BioPharma Corp., of Aurora, Ontario, raised C$16.87 million (US$16.56 million) through the private placement of 10.04 million common shares priced at C$1.68 each. Proceeds will support clinical trials of the company's topical interferon-alpha-2b program as well as research on its urease-based lung cancer candidate. Helix's stock (TSX:HBP) fell C5 cents to close at C$2.10 on Monday.

Innocoll Inc., of Ashburn, Va., raised $30 million through the private placement of convertible preferred stock. Existing shareholders also converted $16 million worth of loans into convertible preferred stock. The financing was led by Camulos Capital LP, NewSmith Asset Management LLP and Morgan Stanley & Co. Inc. Proceeds will support Phase II and Phase III trials with Innocoll's biodegradable surgical implants and collagen-based pharmaceuticals.